ACG3113 Ch 10 Exam Questions And
Complete Answers
Which of the following is not a physical factor related to depreciation? - Answer
obsolescence
Which of the following depreciation methods is not based on the passage of time? -
Answer activity
A depreciation method that is used when a collection of assets is dissimilar and the
assets have different useful lives is the: - Answer composite method
Natural resources include all of the following except: - Answer land improvements
The return on assets is computed by dividing: - Answer net income by average total
assets
Under MACRS, which of the following must be considered in determining depreciation? -
Answer All of these answers are correct
Depreciation is a: - Answer means of allocating the cost of a tangible asset to each of
the periods that benefit from its use.
The depreciable base (cost) of an asset is its original cost: - Answer less salvage value
Which of the following depreciation methods uses book value to determine annual
depreciation - Answer declining-balance
Wildhorse Company purchased a depreciable asset for $37,000 on Jan 1,2020. The
estimated salvage value is %5,100, and the estimated useful life is 4 years. The
sum-of-the-years' digits method is used for depreciation. What is the depreciation
expense for the year 2022? - Answer 6,380
For the composite method, the composite: - Answer life is the total depreciable cost
divided by the total annual depreciation.
The depletion base of a natural resource includes: - Answer all of these answer choices
are correct
The asset turnover ratio is computed by dividing: - Answer net sales by average total
assets
Which of the following is not true of depreciation accounting? - Answer depreciation
lowers the book value of the asset as it ages and its fair value declines
The major difference between the service life of an asset and its physical life is that -
Answer service life refers to the time an asset will be used by a company and physical
Complete Answers
Which of the following is not a physical factor related to depreciation? - Answer
obsolescence
Which of the following depreciation methods is not based on the passage of time? -
Answer activity
A depreciation method that is used when a collection of assets is dissimilar and the
assets have different useful lives is the: - Answer composite method
Natural resources include all of the following except: - Answer land improvements
The return on assets is computed by dividing: - Answer net income by average total
assets
Under MACRS, which of the following must be considered in determining depreciation? -
Answer All of these answers are correct
Depreciation is a: - Answer means of allocating the cost of a tangible asset to each of
the periods that benefit from its use.
The depreciable base (cost) of an asset is its original cost: - Answer less salvage value
Which of the following depreciation methods uses book value to determine annual
depreciation - Answer declining-balance
Wildhorse Company purchased a depreciable asset for $37,000 on Jan 1,2020. The
estimated salvage value is %5,100, and the estimated useful life is 4 years. The
sum-of-the-years' digits method is used for depreciation. What is the depreciation
expense for the year 2022? - Answer 6,380
For the composite method, the composite: - Answer life is the total depreciable cost
divided by the total annual depreciation.
The depletion base of a natural resource includes: - Answer all of these answer choices
are correct
The asset turnover ratio is computed by dividing: - Answer net sales by average total
assets
Which of the following is not true of depreciation accounting? - Answer depreciation
lowers the book value of the asset as it ages and its fair value declines
The major difference between the service life of an asset and its physical life is that -
Answer service life refers to the time an asset will be used by a company and physical
