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