DeVry ACCT 305 Week 3 QUIZ

 

1.Question :(TCO 4) In the first year of an asset’s life, which of the following methods has the largest depreciation?

Student Answer: [removed] Straight-line.  [removed] Double-Declining balance.   [removed] Sum-of-the-years’ digits.   [removed] Composite or group.

 

 

2.Question :(TCO 4) Amortization refers to the cost allocation for:

Student Answer:[removed] A patent.   [removed] A building.   [removed] Land.   [removed] A silver mine.

 

 

3.Question :(TCO 4) The depreciable base for an asset is:

Student Answer: [removed] Its service life.  [removed] The excess of its cost over residual value.   [removed] The difference between its replacement value and cost.   [removed] The amount allowable under MACRS.

 

 

4.Question :(TCO 4) Cutter Enterprises purchased equipment for $72,000 on January 1, 2011. The equipment is expected to have a five-year life and a residual value of $6,000.   Using the straight-line method, depreciation for 2011 would be:

Student Answer:[removed] $13,200.   [removed] $14,400.   [removed] $72,000.   [removed] None of the above is correct.

  

5.Question :(TCO 4) A change in the estimated useful life and residual value of machinery in the current year is handled as:

Student Answer: [removed] A retrospective change back to the date of acquisition as though the current estimated life and residual value had been used all along.  [removed] A prospective change from the current year through the remainder of its useful life, using the new estimates.   [removed] A cumulative adjustment to income in the current year for the difference in depreciation under the new vs. old estimates.   [removed] None of the above is correct.