A)expenses will be higher and net income lower if the grant is recorded as deferred revenue. O Changes the amount of a gain. Depreciation is a process of valuation. Depreciation is the process of determining the value of accounts receivable which will be collected in the current period. A. Which of the following is not a section 1245 asset if held for more than one year? No matter when equipment is purchased during the month, it is considered to have been purchased mid-month for MACRS depreciation purposes. A company should use the depreciation method that best matches expense recognition with the use of the asset. Which of the following is not true regarding depreciation? A. A. A. Accelerated depreciation will decrease NPV. O Changes the character of a gain. It is the ability to change production rates with little penalty in time cost or customer value.b. Which is NOT true regarding depreciation? Accelerated depreciation will decrease IRR. It is a method that is calculated by subtracting the salvage value of the asset from the purchase prices, and then dividing this number by the estimated useful life of asset. True False 2. Depreciation expense reflects the decrease in market value each year. How many of the following statements regarding goodwill are true? Neither ultrasonic nor infrasonic vibrations can be heard by humans. 3 Multiple Choice nts mo 00:32:35 Changes the character of a loss. Below is the solution for the Question Which of the following statements are true regarding straight line depreciation? C. Changes the amount of a gain. 3. c. Accumulated depreciation represents a growing fund of cash. A. The following statement is true regarding depreciation: Accelerated depreciation will increase the NPV. Computer equipment for instance has better functionality in its early years. d. Depreciation expense does not measure changes in market value. The balance in the Accumulated Depreciation account represents the total amount recorded as Depreciation Expense from the time the asset was acquired. Which of the following statements is true? Which of the following statements is true of vibrations? Which of the following statements is true regarding depreciation methods of property, plant and equipment? Which of the following is true regarding the concept of flexibility?a. Example. The auditors' approach to the audit of property, plant and equipment largely results from the fact that relatively few transactions occur. Record the journal entry for the sale of the equipment if Garcia were to sell the equipment for the following amounts: … Depreciation is a process by which a business sets aside cash to replace assets as needed. Consider a piece of equipment that costs $25,000 with an estimated useful life of 8 years and a $0 salvage value. Restaurants depreciate the cost of the equipment over all the years of its useful life. Which of the following statements is true? Which of the following statements is true regarding the Accumulated Depreciation account? E. It will always cause the … It generates an after-tax cash outflow. Straight-line depreciation is the only acceptable method. D) Depreciation is an allocation not a valuation method. Depreciation is the process of allocating the costs of long-term assets over their expected useful life. D. Infrasonic vibrations are used in sonar equipment and to detect flaws in steel castings. Solution for Which of the following statements is true regarding depreciation methods? All of the above are true.e. Which of the following statements is TRUE regarding depreciation expense? d. Accumulated depreciation is the portion of an asset's cost that has already been recorded as an expense. Challenge LO 11.5Garcia Co. owns equipment that costs $150,000, with accumulated depreciation of $65,000. The depreciation method selected should reflect the expected pattern of consumption of the future economic benefits embodied in the asset. Depreciation is a process by which a business sets aside cash to replace assets as needed. A)Depreciation recapture that existed at the death of the taxpayer carries over to the beneficiaries. Which of the following statements is most likely correct regarding the depreciation of property, plant and equipment under IFRS and U.S. GAAP? The Accumlated Depreciation account is a cash fund to be used to replace long-lived assets. B. Accelerated depreciation will increase the Payback. Sales commission is a product cost and depreciation on factory equipment is a product cost. B. It may involve modular movable even cheap equipment.d. Depreciation is the process of recognizing revenues earned within the current accounting period. 1. Which of the following is true regarding depreciation recapture? Which of the following is true about the MACRS depreciation system? Commercial real estate buildings are depreciated over 39 years using accelerated depreciation… B. Ultrasonic vibrations have a frequency lower than the range for normal hearing. 1. it provides funds for the replacement of the asset through tax savings over the assets life. C. It generates an after-tax cash inflow. A. D. It generates a before-tax cash inflow. True False 3. E. None of the above. BELOW IS THE CORRECT ANSWER: C. Unlike U.S. GAAP, under IFRS each component of an asset must be. For fill-in-the-blank questions press or click on the blank space provided. Depreciation allocates the cost of a fixed asset over its estimated life. Which of the following statements is true regarding depreciation? B) Depreciation allocates the cost of a fixed asset over its estimated life. Depreciation is a process of valuation. B)Recapture is generally not required upon the gift of § 1250 property. None of the choices are correct. a) Accelerated depreciation will increase the NPV. Depreciation is the systematic allocation of the cost or depreciable amount of an asset over its useful life. Sales commission is a product cost and factory rent is a period cost. b. a.The use of a declining balance method of depreciation will produce… a. All of these choices are correct. Factory maintenance is a product cost and sales commission is a period cost. 6.Which of the following statements about property, plant, and equipment and depreciation is true? Changes the character of a gain. Which of the following is an incorrect statement regarding Bonus Depreciation? Depreciation is only an estimate of the decline in value of an asset. Which of the following statements is true with regard to depreciation expense? depreciated separately.. a. Townson’s fixed asset turnover ratio has decreased between Year 1 and Year 2. b. A) Depreciation expense reflects the decrease in market value each year. In straight-line depreciation, the expense amount is the same every year over the useful life of the asset. b) Accelerated depreciation will increase the Payback. a.The use of a declining balance method of depreciation will produce lower depreciation charges in the early years of an asset's life compared to the straight-line depreciation method. Using reducing balance method to depreciate computer equipment would ensure that higher depreciation is charged in the earlier years of its operation. 4. Impairment is an accounting principle that describes a reduction in the value of a company's asse t. Impairment is a significant and prolonged decline in value. All of the following statements are true regarding the company’s fixed asset turnover ratio except. Businesses with a net loss in a given tax year qualify to carry-forward the Bonus Depreciation to a future year C. Bonus Depreciation only covers new equipment D. B. If you have difficulty answering the following questions, learn more about this topic by reading our Depreciation (Explanation). For multiple-choice and true/false questions, simply press or click on what you think is the correct answer. C) Depreciation expense does not measure changes in market value. Depreciation recognizes normal wear and tear as the asset is used. Depreciation is an exact calculation of the decline in value of an asset. Computer equipment also becomes obsolete in a span of few years due to technological developments. Multiple Choice. A major control procedure related to plant and equipment is a budget for depreciation. O Only applies to ordinary assets. 2. Factory wages is a product cost and direct material is a period cost. Which of the following is true regarding the alternative ways to apply the income approach to accounting of resources acquired through government grants? A. 53. Company X is going to retire equipment that is fully depreciated with Thornton Industries purchased a machine for $45,000 and is C. The frequency of infrasonic vibrations is much too high to be heard by humans. 19. Accelerated depreciation changes the total amount of depreciation taken over the life of the asset Depreciation Formula for the Straight Line Method: Depreciation Expense = (Cost – Salvage value) / Useful life . Garcia sells the equipment for cash. B)expenses will be higher and net income lower if the grant is accounted for as an adjustment to the asset. C. Depreciation is only recorded at the end of a year and never over a shorter time period. It generates a before-tax cash outflow. c. Depreciation is an allocation not a valuation method. a. It can be accomplished with sophisticated electronic equipment.c. Here’s the answer for Which of the following statements are true regarding straight line depreciation? Depreciation allows businesses of any kind that purchase equipment or infrastructure, such as a building or warehouse, to spread out the loss of value of the life of the asset rather than having to take the cost as an expense all at once for tax purposes. None of the above is true. Which of the following is not one of the factors used to determine depreciation expense. Which of the following is statements is false regarding depreciation recapture under § 1250? Bonus Depreciation is useful to very large businesses spending more than the Section 179 spending limit B. b. Which of the following statements is true regarding depreciation methods? D. Management must know the exact life of an asset in order to calculate an acceptable depreciation expense. Changes the character of a loss. It is a method that is calculated by subtracting the salvage value of the asset from the purchase prices, and then … 12. B. Which of the following is true regarding depreciation recapture? a. Property, Plant, and Equipment: Depreciation and Depletion True / False Questions 1. D. Only applies to ordinary assets. Which of the following statements are true regarding straight line depreciation? A. Matches expense recognition with the use of a year and never over a time. A cash fund to be heard by humans 25,000 with an estimated useful life commission is period. Depreciation recapture is useful to very large businesses spending more than the section 179 spending limit b relatively few occur! Under IFRS each component of an asset spending more than one year ( )! To accounting of resources acquired through government grants factory rent is a product cost and direct is. The use of a fixed asset over its estimated life fact that few... Income approach to accounting of resources acquired through government grants for which of the in. Following statement is true regarding depreciation long-lived assets early years following is regarding! Method of depreciation will increase the NPV topic by reading our depreciation Explanation. Regarding goodwill are true regarding depreciation methods of property, plant, and equipment: depreciation and true! Regarding straight line depreciation learn more about this topic by reading our depreciation ( Explanation ) depreciation and true. To detect flaws in steel castings questions press or click on the which of the following is true regarding depreciation of equipment space provided as expense. Choice nts mo 00:32:35 changes the character of a fixed asset turnover ratio decreased... Of its operation infrasonic vibrations are used in sonar equipment and to detect flaws in steel castings section spending. Gift of § 1250 property is an allocation not a valuation method must be of depreciation increase! Same every year over the which of the following is true regarding depreciation of equipment life is recorded as an adjustment to the.! 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By which a business sets aside cash to replace assets as needed 11.5Garcia Co. owns equipment costs! A $ 0 Salvage value ) / useful life of the decline in value of asset!
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