ACCT 2323 Study Guide - Quiz Guide: Accounts Payable, Macrs, Net Income
CH 16, 17 Quiz trial 2
1. Mount Company purchased a machine at an invoice cost of $26,000 subject
to terms of 2/10, n/30. The discount was taken. Additional costs were
installation $1,200; insurance on the machine after it was in operation $500.
The total cost to be added to the machinery account is:
$26,680
2. Assembly costs, and any other costs necessary to get a machine ready for
operation, including freight costs, would be added to the cost of the machine.
True
3. The depreciation method in which an even amount of depreciation expense
is taken each year is called:
Straight-line method
4. What would be the depreciation expense using double declining-balance to
compute the expense for year 2 of a machine costing $20,000, when residual
value is $5,000 and useful life is 3 years?
$4,422
5. Using MACRS rates for a 15 and 20 year property, what is the percentage for
the depreciable rate?
150 percent
6. Capital expenditures would include:
Betterments, extraordinary repairs, additions (all of the above)
7. Corbin Corporation has a plant asset with a cost of $38,000 that is traded for
a similar asset priced at $76,000. Assuming accumulated depreciation of
$10,000 and a trade-in allowance of $5,000, what is the cost basis for the new
asset?
$76,000
8. A truck that cost $26,000 has been owned for 3 years and is traded for
another truck for the same purpose. Total accumulated depreciation at the
time of trade is $17,100. The trade-in value of the old truck is $10,000 and
the new truck has a fair market value of $36,000. The new truck would be
recorded at:
$36,000
9. The characteristic that means if a partnership is unable to pay its obligations
all general partners are individually liable is known as:
Unlimited liability
10. Tricia and Jennifer formed a partnership. Tricia invested $15,000 cash;
Jennifer invested $8,000 cash, equipment with a fair value of $7,000 and
$2,000 accounts payable. The proper entry to record this is:
debit Cash $23,000; debit Equipment $7,000; credit Accounts Payable
$2,000; credit Tricia’s Capital $15,000; credit Jennifer’s Capital
$13,000
11. If Blake invests $10,000 cash in a partnership, Cash is debited and Blake,
Capital is credited $10,000.
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Document Summary
Ch 16, 17 quiz trial 2: mount company purchased a machine at an invoice cost of ,000 subject to terms of 2/10, n/30. Additional costs were installation ,200; insurance on the machine after it was in operation . The total cost to be added to the machinery account is: ,680: assembly costs, and any other costs necessary to get a machine ready for operation, including freight costs, would be added to the cost of the machine. True: the depreciation method in which an even amount of depreciation expense is taken each year is called: 150 percent: capital expenditures would include: Betterments, extraordinary repairs, additions (all of the above: corbin corporation has a plant asset with a cost of ,000 that is traded for a similar asset priced at ,000. ,000: a truck that cost ,000 has been owned for 3 years and is traded for another truck for the same purpose.
