30. Carlson Imports sold a depreciableplant asset for cash of $35,000. The accumulated depreciationamounted to $70,000, and a loss of $5,000 was recognized on thesale. Under these circumstances, the original cost of the assetmust have been:
A) $65,000.
B) $75,000.
C) $100,000.
D) $110,000.
31. Tivoli Instrumentationsold a depreciable asset for cash of $100,000. The original cost ofthe asset was $400,000. Tivoli recognized a gain of $15,000 on thesale. What was the amount of accumulated depreciation on the assetat the time of its sale?
A) $315,000.
B) $85,000.
C) $385,000.
D) $300,000.
32. Machinery acquired new onJanuary 1 at a cost of $50,000 was estimated to have a useful lifeof 10 years and a residual salvage value of $20,000. Straight-linedepreciation was used. On January 1, following six full years ofuse of the machinery, management decided that the estimate ofuseful life had been too long and that the machinery would have tobe retired after two more years, that is, at the end of the eighthyear of service. Under this revised estimate, the depreciationexpense for the seventh year of use would be:
A) $6,000.
B) $8,000.
C) $11,000.
D) $12,000.
33. The ability of a partner toenter into a contract on behalf of all partners is called
a. voluntary agency.
b. mutualagency.
c. unlimitedliability.
d. voluntaryassociation.
34. Which of the following doesnot result in dissolution of a partnership?
a. Admissionof a new partner
b. Sale ofpartnership assets
c. Death of apartner
e. Bankruptcyof a partner
35. Jerry and Rose haveagreed to form a partnership. Accordingly Rose will invest $40,000worth of equipment which has a note payable of $15, 000 which thepartnership assumes, and Jerry will invest $40,000 in cash. TheRose’s capital account balance will be.
A. $40,000
B. $25,000
C. $15,000
D. $80,000
36. One method ofdistributing income and losses is to give each partner a stated
ratio of the total income or loss. There are two partners Jerry& Rose, each making an equal contribution to the firm (50/50).However the partnership agreement states that distributions wouldbe made 60% and 40% respectively. Jerry and Rose are partners ofthe firm which had a net income $100,000. Therefore Jerry’s shareof income is:
A. $50,000
B. $40,000
C. $100,000
D. $60,000
37. After March, 2004 international standards required thatgoodwill
A) Be capitalized and amortized over 20 years or less.
B) Be capitalized and amortized over 40 years or less.
C) Be capitalized and reviewed annually and its value should beadjusted if impaired.
D) Be expensed immediately.
38. Manufacturing overheadis best described as:
A) All manufacturing costs other than direct materials and directlabor.
B) All period costs associated with manufacturingoperations.
C) Indirect materials and indirect labor.
D) All operating expenses other than selling expenses and generaland administrative expenses.
39. Which of the followingcosts would not be considered part of the manufacturing overhead ofa furniture manufacturer?
A) The cost of compliance with federal factory safetyregulations.
B) Depreciation expense on factory equipment.
C) The cost of grease used to lubricate factoryequipment.
D) The cost of wood used in furniture construction.
