accounting crisis help?

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Posted by Chip | Posted in Uncategorized | Posted on 12-02-2012

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depletion expense13 accounting crisis help?
Kris B asked:

7. A building with an appraisal value of $137,000 is made available at an offer price of $142,000. The purchaser acquires the property for $30,000 in cash, a 90-day note payable for $40,000, and a mortgage amounting to $60,000. The cost basis recorded in the buyer’s accounting records to recognize this purchase is
a. $137,000
b. $142,000
c. $130,000
d. $100,000

8. Expenditures that add to the utility of fixed assets for more than one accounting period are
a. committed expenditures
b. revenue expenditures
c. current expenditures
d. capital expenditures

9. Which of the following below is an example of a capital expenditure?
a. cleaning the carpet in the front room
b. tune-up for a company truck
c. replacing an engine in a company car
d. replacing all burned-out light bulbs in the factory

10. A fixed asset’s estimated value at the time it is to be retired from service is called
a. book value
b. residual value
c. market value
d. carrying value

13. A machine with a cost of $65,000 has an estimated residual value of $5,000 and an estimated life of 4 years or 18,000 hours. What is the amount of depreciation for the second full year, using the double declining-balance method?
a. $15,000
b. $30,000
c. $16,250
d. $32,500

14. The proper journal entry to purchase a computer on account to be utilized within the business would be:
a. Jan 2 Office Supplies 1,250.00
Accounts Payable 1,250.00
b. Jan 2 Office Equipment 1,250.00
Accounts Payable 1,250.00
c. Jan 2 Office Supplies 1,250.00
Accounts Receivable 1,250.00
d. Jan 2 Office Equipment 1,250.00
Accounts Receivable 1,250.00

16. The Weber Company purchased a mining site for $500,000 on July 1, 2007. The company expects to mine ore for the next 10 years and anticipates that a total of 100,000 tons will be recovered. The estimated residual value of the property is $80,000. During 2007 the company extracted 6,000 tons of ore. The depletion expense for 2007 is
a. $12,600
b. $42,000
c. $25,200
d. $50,000

18.The exclusive right to use a certain name or symbol is called a
a. franchise
b. patent
c. trademark
d. copyright

19. Fixed assets are ordinarily presented in the balance sheet
a. at current market values
b. at replacement costs
c. at cost less accumulated depreciation
d. in a separate section along with intangible assets

20. On June 8, Acme Co. issued an $80,000, 6%, 120-day note payable to Still Co. What is the maturity value of the note?
a. $80,100
b. $84,800
c. $81,600
d. $81,200

21.On June 8, Acme Co. issued an $80,000, 6%, 120-day note payable to Still Co. Assume that the fiscal year of Acme Co. ends June 30. What is the amount of interest expense recognized by Acme in the current fiscal year?
a. $293.33
b. $400.00
c. $391.10
d. $1,600.00

Fortune 5 Minutes

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  • the weber company purchased a mining site for $500 000 on july 1 2011 the company expects to mine ore for the next 10 years and anticipates that a total of 100 000 tons will be recovered the estimated residual value of the property is $80 000 during 2011
  • a machine with a cost of $75 000 has an estimated residual value of $5 000 and an estimated life of 4 years or 18 000 hours what is the amount of depreciation for the second full year using the double declining-balance method?
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Comments (1)

Fortune 5 Minutes

7. A building with an appraisal value of $137,000 is made available at an offer price of $142,000. The purchaser acquires the property for $30,000 in cash, a 90-day note payable for $40,000, and a mortgage amounting to $60,000. The cost basis recorded in the buyer’s accounting records to recognize this purchase is
c. $130,000

8. Expenditures that add to the utility of fixed assets for more than one accounting period are
d. capital expenditures

9. Which of the following below is an example of a capital expenditure?
c. replacing an engine in a company car

10. A fixed asset’s estimated value at the time it is to be retired from service is called
b. residual value

13. A machine with a cost of $65,000 has an estimated residual value of $5,000 and an estimated life of 4 years or 18,000 hours. What is the amount of depreciation for the second full year, using the double declining-balance method?
c. $16,250

14. The proper journal entry to purchase a computer on account to be utilized within the business would be:
b. Jan 2 Office Equipment 1,250.00
Accounts Payable 1,250.00

16. The Weber Company purchased a mining site for $500,000 on July 1, 2007. The company expects to mine ore for the next 10 years and anticipates that a total of 100,000 tons will be recovered. The estimated residual value of the property is $80,000. During 2007 the company extracted 6,000 tons of ore. The depletion expense for 2007 is
c. $25,200

18.The exclusive right to use a certain name or symbol is called a
a. franchise

19. Fixed assets are ordinarily presented in the balance sheet
c. at cost less accumulated depreciation

20. On June 8, Acme Co. issued an $80,000, 6%, 120-day note payable to Still Co. What is the maturity value of the note?
c. $81,600

21.On June 8, Acme Co. issued an $80,000, 6%, 120-day note payable to Still Co. Assume that the fiscal year of Acme Co. ends June 30. What is the amount of interest expense recognized by Acme in the current fiscal year?
a. $293.33

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