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