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Accounting Book 9 Questions with complete solution

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Accounting Book 9 Questions with complete solution Tangible assets are first recorded at ______. - correct answer all costs to acquire them and prepare them for use Which of the following would cause the balance sheet to appear stronger and income statement to appear more profitable than it sh...

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  • August 11, 2024
  • 9
  • 2024/2025
  • Exam (elaborations)
  • Questions & answers

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Accounting Book 9
Tangible assets are first recorded at ______. - correct answer ✔all costs to
acquire them and prepare them for use


Which of the following would cause the balance sheet to appear stronger and
income statement to appear more profitable than it should? - correct answer
✔Capitalizing costs that should be expensed.


Cedar Fair purchased land; which of the following should be debited to the
Land account? - correct answer ✔Legal fees for the land's title search
Commissions paid to brokers when purchasing the land
Fees for surveying of the land


Which of the following is a long-lived asset? - correct answer ✔Land on
which to build a new store


Sunny Sky paid $30,000 cash for piece of land to be used for a new corporate
headquarters building. What is the effect of this transaction on the accounting
equation? - correct answer ✔One asset increases, while another asset
decreases.


Sunny Skys, Inc. bought a derelict hunting lodge, which it tore down at a cost
of $45,000 and replaced with a new lodge. The demolition cost should be
______.
Multiple choice question. - correct answer ✔capitalized


In the case of a basket purchase, the cost of the land and building is ______. -
correct answer ✔split among the assets purchased in proportion to the
market value of the assets as a whole

, Executives at WorldCom committed an $11 billion fraud by capitalizing costs
that should have been expensed. What was the effect of this fraud on
WorldCom's balance sheet? (Check all that apply.) - correct answer ✔Total
assets were too high.
Retained earnings were too high


Which of the following is true? - correct answer ✔Capitalized costs increase
long-lived assets.


Long-lived assets are ______. (Check all that apply.)
Multiple select question. - correct answer ✔used by the business
assets acquired for use over 1 or more years


Thermal, Inc. bought a new computer system for $50,000 cash. What is the
effect of this purchase on the company's total assets? Total assets ______. -
correct answer ✔remain the same


The Three Little Pigs purchased three houses for a total cost of $160,000.
Appraisal values for the three completed houses were: straw house, $40,000;
wood house $60,000; and brick house $100,000. Using the basket purchase
allocation, the recorded value of the brick house should be ______. - correct
answer ✔$80,000


X-it Company, signed a $500,000, 5-year note payable to buy a new industrial
machine. The company paid $2,000 cash for transportation of the machine
and $1,000 cash for installation costs. The journal entry to record this
transaction will include a ______. (Check all that apply.) - correct answer
✔$3,000 credit to Cash
$500,000 credit to Note Payable

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