Posted: September 11th, 2015

Assignment :"true" or "false".

Assignment :”true” or “false”.

Answer the flowing
A – Choose “true” or “false” as applicable for each of the following items as they pertain to changes in depreciation estimates.
1.    Since estimates are inherent in all depreciation calculations, changes in estimates require no action be taken.
2.    Changes in estimates require that depreciation expense for prior periods be recalculated and restated.
3.    Changes in estimates require that depreciation expense for the current and future periods be recalculated.
4.    The current book value of an asset should be used to recalculate depreciation expense.
5.    The revised TOTAL useful life should be used to recalculate depreciation expense
6.    Accelerated depreciation is better suited for situations where asset usage varies each period.
7.    Accelerated depreciation depreciates assets in fewer periods than other depreciation methods
8.    Units of activity is better suited for situations where asset usage is consistent each period.
9.    In an asset s first year of depreciation, straight-line depreciation will generate a higher depreciation expense than accelerated depreciation.
10.    In an asset s final year of depreciation, straight line depreciation will generate a higher depreciation expense than accelerated depreciation (assume the asset is held and used for its entire estimated useful life).
11.    f the asset is sold, a gain will occur if the sell price of the asset exceeds the book value of the asset.
12.    If the asset is sold, a loss will occur if the book value of the asset exceeds the sell price of the asset.
13.    If the asset is discarded or retired, a loss will occur regardless of the book value of the asset.
14.    If the asset is discarded or retired, it is typically possible for a gain to occur
15.    Gains and losses are deemed to result from normal operating activities.
B – Choose “yes” or “no” as applicable for each of the following items to indicate whether the cost can appropriately be debited to the plant asset ledger account.
16.    Transportation costs to ship the asset to our facilities.(              )
17.    Set up and installation costs of the asset.(              )
18.    Insurance while the asset is in transit to our facilities.(              )
19.    Insurance while the asset is being run during routine operations.
20.    Costs to train employees on how to use the new asset.(              )
21.    Costs to tear down and remove an old building on a recently purchased parcel of land.
22.    Back due real estate taxes on a recently purchased parcel of land.(              )
23.    Repairs and maintenance during routine use(              )
C – Choose the item that most accurately and completely describes acquisition costs that can appropriately be debited to a plant asset ledger account.
1 -All expenditure related to the asset.2 – The invoice cost of the asset.
3 -All normal and reasonable costs necessary to get the asset in place and ready for its intended use.4 -Expenditures required to maintain the asset during routine operation.