Chapter 10, 11, 13, 17 (Horngren's Accounting Vol. 2) Exam Questions with Complete Solutions Payroll Expenses - Correct Answers: CPP-100% EI-140% Revenue Expenditures - Correct Answers: -regular maintenance to keep in working condition -low cost

Chapter 10, 11, 13, 17 (Horngren's Accounting Vol. 2) Exam Questions with Complete Solutions Payroll Expenses - Correct Answers: CPP-100% EI-140% Revenue Expenditures - Correct Answers: -regular maintenance to keep in working condition -low cost purchases (office supplies) -expense account Capital Expenditures - Correct Answers: -major purchases -betterments (improvement of assets) -"Capitalized": debited to asset account and amortized over time Total Appraised Value Calculation - Correct Answers: actual cost / total market, appraised values (multiply resulting percentage by each appraised asset for acct purposes) Amortizable Cost Calculation - Correct Answers: Cost - Residual Value Straight-Line Amortization - Correct Answers: (Cost - Residual Value) / Useful Life in Years x __/12 Units of Production Amortization - Correct Answers: (Cost - Residual Value) / Estimated # of Units of Production = amortization per unit x calculated value by usage per year Book Value - Correct Answers: Cost - Accumulated Amortization to Date (You cannot amortize an item below residual value. When Book Value = Residual Value, stop amortizing) Double-Declining-Balance Amortization - Correct Answers: 1) Divide 2 by Useful Life [e.g. 2/5] 2) Multiply by Book Value RESIDUAL VALUE NOT INCLUDED IN CALCULATION Trade In Gain or Loss - Correct Answers: Trade In Allowance - Old Asset's BV Amortization of Intangible Assets - Correct Answers: 1) Use shorter of useful life or legal life 2) Straight Line Amortization, no residual value Journal Entries: DR Expense CR Asset (Patent, Leasehold, etc.) Book Value per Share - Correct Answers: Total Shareholder Equity / # Common Shares Issued or (Total Shareholder Equity - Total Preferred Share Book Value*) / # Common Shares Issued *(Issue Price + Dividends in Arrears) x # PFD Shares Issued Return on Total Assets (ROTA) - Correct Answers: Measures whether a business is successful in using assets to earn income for shareholders and creditors. [(NI + Interest Expense) / Avg Total Assets ] x 100 Return on Common Shareholders Equity (ROCSE) - Correct Answers: Measures percentage return on dollars invested by Common S/H. [(NI - PFD Dividend) / Avg Total Common S/H Equity]