Property and equipment is reported at its: historical cost. market value. book v
ID: 2576633 • Letter: P
Question
Property and equipment is reported at its:
historical cost.
market value.
book value.
fair value.
depreciation cost.
Uganda Corporation estimates the life of its building to be 30 years. It originally cost $300,000 and was given a residual value of $30,000. Depreciation expense per year should be:
$100,000.
$10,000.
$300,000.
$9,000.
$90,000.
QUESTION 3
Western Corporation purchased a machine for $20,000 with no residual value and a life of 4 years. What is the book value of the machine at the end of Year 4?
$5,000
$16,000
$4,000
$0
$20,000
QUESTION 4
The difference between the cost of an asset and its salvage value is its:
historical cost.
book value.
fair value.
depreciable base.
depreciation expense.
QUESTION 5
An asset costing $50,000 with accumulated depreciation of $20,000 is sold for $25,000. What is the resulting gain or loss?
$5,000 gain
$5,000 loss
Cannot determine since salvage value is not provided in the question.
QUESTION 6
Which of the following is an example of an accelerated depreciation method?
The units-of-production method
The half-year convention method
The fixed assets turnover method
The double-declining balance method
The straight-line method
QUESTION 7
Mannow Company uses the units-of-production depreciation method. Mannow purchased a machine for $80,000 with no salvage value. Mannow believes the machine will produce 400,000 units. In the first year, 90,000 units are produced. In the second year, 70,000 units are produced. What is the balance in accumulated depreciation at the end of year two?
$14,000
$32,000
$10,000
$18,000
$16,000
A.historical cost.
B.market value.
C.book value.
D.fair value.
E.depreciation cost.
Explanation / Answer
Question 1
Property and equipment generally reported at its original cost less depreciation since acquisition.
So answer will be A. Historical cost.
Question 2.
Question 3
book value of the assets after life of the assets will be the salvage / residual value only.
In given case salvage value is 0. so answer also 0.
Question 4
Difference between cost of the assets and its salvage value is depreciable base. Under stright line method or sum of the year method or activity based method, depreciation will calculated on depreciable base only.
Cost of the building $ 300,000 Less: Residual value $ (30,000) Depreciable value $ 270,000 Depreciation per year ($270,000/30) $ 9,000Related Questions
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