1. On December 31, Strike Company has decided to sell one of its batting cages. The initial cost of the equipment was $215,000 with an accumulated depreciation of $185,000. Depreciation has been taken up to the end of the year. The company found a company that is willing to buy the equipment for $55,000. What is the amount of the gain or loss on this transaction?
2. The proper journal entry to purchase a computer on account to be utilized within the business would be:
3. Computer equipment was acquired at the beginning of the year at a cost of $65,000 that has an estimated residual value of $3,000 and an estimated useful life of 5 years. Determine the 2nd year’s depreciation using straight-line depreciation. Choose one answer.
4. A fixed asset with a cost of $41,000 and accumulated depreciation of $36,500 is traded for a similar asset priced at $60,000. Assuming a trade-in allowance of $3,000, the recognized loss on the trade is
5. The calculation for annual depreciation using the units-of-production method is
6. A fixed asset with a cost of $52,000 and accumulated depreciation of $47,500 is traded for a similar asset priced at $60,000. Assuming a trade-in allowance of $5,000, the cost basis of the new asset is
7. When a company replaces a component of property, plant and equipment, which statement below does not account for one of the steps to this process?
8. All of the following below are needed for the calculation of straight-line depreciation except
9. Expenditures that add to the utility of fixed assets for more than one accounting period are
10. The exclusive right to use a certain name or symbol is called a
11.When the amount of use of a fixed asset varies from year to year, the method of determining depreciation expense that best matches allocation of cost with revenue is
12. 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?
13. Expenditures for research and development are generally recorded as
14. Equipment with a cost of $160,000, an estimated residual value of $40,000, and an estimated life of 15 years was depreciated by the straight-line method for 4 years. Due to obsolescence, it was determined that the useful life should be shortened by 3 years and the residual value changed to zero. The depreciation expense for the current and future years is
15. Which of the following should be included in the acquisition cost of a piece of equipment?
16. A fixed asset's estimated value at the time it is to be retired from service is called
17. Equipment with a cost of $130,000 has an estimated residual value of $10,000 and an estimated life of 5 years or 12,000 hours. It is to be depreciated by the straight-line method. What is the amount of depreciation for the first full year, during which the equipment was used 3,300 hours?
18. The term applied to the amount of cost to transfer to expense resulting from a decline in the utility of intangible assets is
19. The calculation for annual depreciation using the straight-line depreciation method is
20. On December 31, Strike Company has decided to trade-in one of its batting cages for another one that has a cost of $500,000. The seller of the batting cage is willing to allow a trade-in amount of $40,000. The initial cost of the old equipment was $225,000 with an accumulated depreciation of $195,000. Depreciation has been taken up to the end of the year. The difference will be paid in cash. What is the amount of the gain or loss on this transaction?
Click here for the solution: On December 31, Strike Company has decided to sell one of its batting cages
