ACCS Review Exam with Accurate
Answers
Which of the following statements related to property, plant, and equipment (PP&E) is TRUE? -
✔✔Depreciation involves the systematic and rational allocation of the cost of a PP&E asset to
expense as it is used to help generate revenue for the company.
Assets classified as PP&E must be both long-term in nature and possess physical substance.
Costs incurred after the acquisition of a PP&E asset that increase its useful life are capitalized
and depreciated over its remaining useful life.
Which of the following statements related to property, plant, and equipment (PP&E) is TRUE? -
✔✔Depreciation involves the systematic and rational allocation of the cost of a PP&E asset to
expense as it is used to help generate revenue for the company.
Assets classified as PP&E must be both long-term in nature and possess physical substance.
Costs incurred after the acquisition of a PP&E asset that increase its useful life are capitalized
and depreciated over its remaining useful life.
In order for a cost to be capitalized (capital expenditure), the following must be present: -
✔✔Any of these answers are correct.
Which of the following statements related to non-monetary exchanges is TRUE? - ✔✔A
nonmonetary exchange of assets has commercial substance if the future cash flows of the two
parties change as a result of the transaction.
Ringler Corporation exchanges one plant asset for a similar plant asset and gives cash in the
exchange. The exchange is not expected to cause a material change in the future cash flows for
either entity. If a gain on the disposal of the old asset is indicated, the gain will - ✔✔deferred by
effectively reducing the amount to be recorded as the cost of the new asset.
Which of the following costs are capitalized for self-constructed assets? - ✔✔Materials, labor,
and overhead
Answers
Which of the following statements related to property, plant, and equipment (PP&E) is TRUE? -
✔✔Depreciation involves the systematic and rational allocation of the cost of a PP&E asset to
expense as it is used to help generate revenue for the company.
Assets classified as PP&E must be both long-term in nature and possess physical substance.
Costs incurred after the acquisition of a PP&E asset that increase its useful life are capitalized
and depreciated over its remaining useful life.
Which of the following statements related to property, plant, and equipment (PP&E) is TRUE? -
✔✔Depreciation involves the systematic and rational allocation of the cost of a PP&E asset to
expense as it is used to help generate revenue for the company.
Assets classified as PP&E must be both long-term in nature and possess physical substance.
Costs incurred after the acquisition of a PP&E asset that increase its useful life are capitalized
and depreciated over its remaining useful life.
In order for a cost to be capitalized (capital expenditure), the following must be present: -
✔✔Any of these answers are correct.
Which of the following statements related to non-monetary exchanges is TRUE? - ✔✔A
nonmonetary exchange of assets has commercial substance if the future cash flows of the two
parties change as a result of the transaction.
Ringler Corporation exchanges one plant asset for a similar plant asset and gives cash in the
exchange. The exchange is not expected to cause a material change in the future cash flows for
either entity. If a gain on the disposal of the old asset is indicated, the gain will - ✔✔deferred by
effectively reducing the amount to be recorded as the cost of the new asset.
Which of the following costs are capitalized for self-constructed assets? - ✔✔Materials, labor,
and overhead
