Accounting 3311 Test Three Review

Plant assets may properly include

Which of the following is not a major characteristic of a plant asset?

Which of these is not a major characteristic of a plant asset?

Cotton Hotel Corporation recently purchased Emporia Hotel and the land on which it is located with the plan to tear down the Emporia Hotel and build a new luxury hotel on the site. The cost of the Emporia Hotel should be

The cost of land does not include

The cost of land typically includes the purchase price and all of the following costs except

If a corporation purchases land and building and subsequently tears down the building and uses the property as a parking lot, the proper accounting treatment of the cost of the building would depend on

Historical cost is the basis advocated for recording the acquisition of property, plant, and equipment for all of the following reasons except

To be consistent with the historical cost principle, overhead costs incurred by an enterprise constructing its own building should be

Which of the following costs are capitalized for self-constructed assets?

Which of the following assets do not qualify for capitalization of interest costs incurred during construction of the assets?

Assets that qualify for interest cost capitalization include

When computing the amount of interest cost to be capitalized, the concept of "avoidable interest" refers to

The period of time during which interest must be capitalized ends when

Which of the following statements is true regarding capitalization of interest?

When a company purchases land as a site for a plant, interest costs capitalized during the period of construction are part of the:

When funds are borrowed to pay for construction of assets that qualify for capitalization of interest, the excess funds not needed to pay for construction may be temporarily invested in interest-bearing securities. Interest earned on these temporary investments should be

Interest cost that is capitalized should

Which of the following is not a condition that must be satisfied before interest capitalization can begin on a qualifying asset?

Which of the following is the recommended approach to handling interest incurred in financing the construction of property, plant and equipment?

Which of the following nonmonetary exchange transactions represents a culmination of the earning process?

When boot is involved in an exchange having commercial substance

The cost of a nonmonetary asset acquired in exchange for another nonmonetary asset when the exchange has commercial substance is usually recorded at

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

A company should immediately recognize:

Accounting recognition should be given to some or all of the gain realized on a nonmonetary exchange of plant assets except when the exchange has

For a nonmonetary exchange of plant assets, accounting recognition should not be given to

In order for a cost to be capitalized (capital expenditure), the following must be present:

An improvement made to a machine increased its fair value and its production capacity by 25% without extending the machine's useful life. The cost of the improvement should be

Which of the following is a capital expenditure?

Which of the following is not a capital expenditure?

In accounting for plant assets, which of the following outlays made subsequent to acquisition should be fully expensed in the period the expenditure is made?

An expenditure made in connection with a machine being used by an enterprise should be

When a plant asset is disposed of, a gain or loss may result. The gain or loss would be classified as an extraordinary item on the income statement if it resulted from

Termination of an asset's service due to theft, fire, etc, is called:

Which of the following statements about involuntary conversions is false?

Depreciation is normally computed on the basis of the nearest

McDonald Company acquired machinery on January 1, 2009 which it depreciated under the straight-line method with an estimated life of fifteen years and no salvage value. On January 1, 2014, McDonald estimated that the remaining life of this machinery was six years with no salvage value. How should this change be accounted for by McDonald?

A change in estimate should

Lamar Printing Company determines that a printing press used in its operations has suffered a permanent impairment in value because of technological changes. An entry to record the impairment should

Which of following is not a similarity in the accounting treatment for depreciation and cost depletion?

Which of the following is not a difference between the accounting treatment for depreciation and cost depletion?

Dividends representing a return of capital to stockholders are not uncommon among companies which

Depletion expense

The most common method of recording depletion for accounting purposes is the

Reserve recognition accounting

Of the following costs related to the development of natural resources, which one is not a part of depletion cost?

Which of the following does not describe intangible assets?

Which of the following characteristics do intangible assets possess?