MBA 620 FINAL 2026 TEST BANK
TESTED QUESTIONS CORRECT
ANSWERS
◉ Tangible Asset. Answer: assets that you can physically touch (PPE,
natural resources)
◉ Intangible Asset. Answer: nonphysical asset, such as a patent or
trademark, that has economic value in the form of expected benefit
◉ Basket Purchase. Answer: purchase of more than one asset at the
same time for one purchase price
◉ Deferral. Answer: paying the cash before recognizing the expense
◉ Depreciation Expense Formula. Answer: (asset cost - salvage value) /
useful life
◉ Straight-Line Depreciation. Answer: Method that allocates an equal
portion of the depreciable cost of plant asset (cost minus salvage) to
each accounting period in its useful life.
◉ Contra-Asset Account. Answer: an account that is offset against an
asset account on the balance sheet
, ◉ Book Value. Answer: the difference between the cost of a depreciable
asset and its related accumulated depreciation
◉ Depreciation. Answer: the process of allocating a cost overtime
◉ Matching Concept. Answer: the practice of pairing revenues with
expenses on the income statement
◉ Accelerated Depreciation Method. Answer: A depreciation method
that expenses more of the asset's cost near the start of its useful life and
less at the end of its useful life.
◉ Double-Declining Balance Depreciation. Answer: produces a large
amount of depreciation in the first year of an asset's life and
progressively smaller levels of expense in each succeeding year
◉ Double-Declining Depreciation Formula. Answer: Beginning Year
Book Value * (2(Straight Line Rate))
◉ Current Assets. Answer: an asset that is used or converted to cash
within one year, or one operating cycle, whichever is longer
◉ Current Liabilities. Answer: obligations due within one year, or one
operating cycle, whichever is longer
TESTED QUESTIONS CORRECT
ANSWERS
◉ Tangible Asset. Answer: assets that you can physically touch (PPE,
natural resources)
◉ Intangible Asset. Answer: nonphysical asset, such as a patent or
trademark, that has economic value in the form of expected benefit
◉ Basket Purchase. Answer: purchase of more than one asset at the
same time for one purchase price
◉ Deferral. Answer: paying the cash before recognizing the expense
◉ Depreciation Expense Formula. Answer: (asset cost - salvage value) /
useful life
◉ Straight-Line Depreciation. Answer: Method that allocates an equal
portion of the depreciable cost of plant asset (cost minus salvage) to
each accounting period in its useful life.
◉ Contra-Asset Account. Answer: an account that is offset against an
asset account on the balance sheet
, ◉ Book Value. Answer: the difference between the cost of a depreciable
asset and its related accumulated depreciation
◉ Depreciation. Answer: the process of allocating a cost overtime
◉ Matching Concept. Answer: the practice of pairing revenues with
expenses on the income statement
◉ Accelerated Depreciation Method. Answer: A depreciation method
that expenses more of the asset's cost near the start of its useful life and
less at the end of its useful life.
◉ Double-Declining Balance Depreciation. Answer: produces a large
amount of depreciation in the first year of an asset's life and
progressively smaller levels of expense in each succeeding year
◉ Double-Declining Depreciation Formula. Answer: Beginning Year
Book Value * (2(Straight Line Rate))
◉ Current Assets. Answer: an asset that is used or converted to cash
within one year, or one operating cycle, whichever is longer
◉ Current Liabilities. Answer: obligations due within one year, or one
operating cycle, whichever is longer
