Reporting and Analyzing Long Lived Assets MCQs

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A company is building a new plant that will take three years to construct. Interest capitalized during the construction as part of the cost of the bui...




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When can interest be included in the acquisition cost of a plant asset?






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What is depreciable cost?






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_________ are the costs incurred to increase the operating efficiency or useful life of a plant asset.






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If a plant asset is retired before it is fully depreciated and no salvage value is received, a _____ on disposal occurs.




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Where are natural resources generally shown on the balance sheet?






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The cost of intangible assets with _____ should not be amortized.




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Companies usually show intangible assets separately under "Intangible assets."




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Which of the following should be disclosed in the balance sheet or the notes to the financial statements?






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A patent that has a legal life of 20 years and a useful life of less than 20 years should






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Companies can amortize a patent for a period that cannot exceed






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To find the asset turnover ratio, divide






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To find the book value of a plant asset, you find the difference between the






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If the estimate of the useful life of equipment changes, then this change requires






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In selecting a depreciation method, a company should choose the method that






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When estimating the useful life of an asset, accountants consider all of the following EXCEPT






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A change in the estimate of the useful life of equipment requires






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A plant asset may be removed from the books even though it is not fully depreciated.




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Which of the following applies a constant percentage to depreciable cost in calculating depreciation?






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An overall measure of profitability is the






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Which term refers to a permanent decline in the market value of an asset?






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Intangible assets should be reported






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Which of the following is used to determine the gain or loss on disposal of a plant asset?






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If an intangible asset has a limited life, its cost must be amortized over a period of






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The difference between the cost of the asset and the accumulated depreciation to date is the






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The depreciation and amortization methods should be described in






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The asset turnover ratio is calculated by






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Capital expenditures add to the utility of plant assets for ______ accounting period.




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To record depreciation, taxpayers must use on their tax returns either the straight-line method or the






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Which of the following statements is true?






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________ is the difference between the cost of the plant asset and the accumulated depreciation to date.






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Intangible assets with indefinite lives are not amortized.




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If the estimate of the useful life of equipment changes then






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Capital expenditures are expenditures that increase the company's investment in






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When the book value of a plant asset exceeds the cash received from sale proceeds the result is






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Which of the following is computed and represented at cost less accumulated depreciation in the balance sheet?