Louisiana State University, Shreveport ACCT 701 CHAPTER 10 1)(T / F) The cost of land includes its purchase price and other related costs, including the cost of removing an old unusable building that is on the land. (T / F) The formula for calculating straight-line depreciation is: Depreciation per period = (Asset cost – estimated salvage value) / Number of accounting periods (estimated useful life). (T / F) Units-of-production method: Assigns an equal amount of depreciation to each unit of product manufactured by an asset. (T / F) Double-declining-balance method is an accelerated deprecation method. Salvage value is ignored in making annual calculations (save for the final depreciation period). (T / F) The formula for DDB depreciation is: Depreciation per period = (2×straight-line rate)×(Asset cost – Accumulated depreciation) (T / F) Expenditures that increase the quality of services or extend the quantity of services beyond the original estimate are capital expenditures. (T / F) In

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Louisiana State University, Shreveport ACCT 701 CHAPTER 10 1)(T / F) The cost of land includes its purchase price and other related costs, including the cost of removing an old unusable building that is on the land

Accounting Jul 02, 2021

Louisiana State University, Shreveport

ACCT 701

CHAPTER 10

1)(T / F) The cost of land includes its purchase price and other related costs, including the cost of removing an old unusable building that is on the land.

(T / F) The formula for calculating straight-line depreciation is: Depreciation per period = (Asset cost – estimated salvage value) / Number of accounting periods (estimated useful life).
(T / F) Units-of-production method: Assigns an equal amount of depreciation to each unit of product manufactured by an asset.
(T / F) Double-declining-balance method is an accelerated deprecation method. Salvage value is ignored in making annual calculations (save for the final depreciation period).
(T / F) The formula for DDB depreciation is: Depreciation per period = (2×straight-line rate)×(Asset cost – Accumulated depreciation)
(T / F) Expenditures that increase the quality of services or extend the quantity of services beyond the original estimate are capital expenditures.
(T / F) In calculating depletion, the residual value of acquired land containing an ore deposit is included in total costs subject to depletion.

(T / F) All recorded intangible assets are subject to amortization.
(T / F) By comparing an asset's book value (cost less up-to-date accumulated depreciation) with its sales price, the company may show either a gain or a loss.
(T / F) If an asset's sales price is greater than book value, the company shows a gain. If sales price is less than book value, the company shows a loss. If sales price equals book value, no gain or loss results.

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