Question : 81. A company had a bulldozer destroyed by fire. The bulldozer : 1256941

 

 

81. A company had a bulldozer destroyed by fire. The bulldozer originally cost $125,000. The accumulated depreciation on it was $60,000. The proceeds from the insurance company were $90,000. The company should recognize: 

A. A loss of $25,000.

B. A gain of $25,000.

C. A loss of $65,000.

D. A gain of $65,000.

E. A gain of $90,000.

 

 

82. Blanket Corporation sold equipment for cash of $40,500. Accumulated depreciation on the sale date amounted to $34,000 and a loss of $1,800 was recognized on the sale.

What was the original cost of the asset? 

A. $72,300

B. $75,900

C. $4,700

D. $76,300

E. $42,300

 

 

83. Assume BizChair.com sold a used conveyor belt for $172,000 cash. If accumulated depreciation on the sale date was $58,311 and a gain of $6,721 was recognized on the sale, what was the original cost of the asset? 

A. $223,590

B. $216,869

C. $165,279

D. $65,032

E. $113,689

 

 

84. A company sold equipment for $50,000. Total accumulated depreciation at the time of the sale was $20,000 and a loss of $10,000 was recognized on the sale. What was the original cost of the asset? 

A. $60,000

B. $80,000

C. $70,000

D. $40,000

E. $30,000

 

 

85. Depletion: 

A. Is the process of allocating the cost of natural resources to periods in which they are consumed.

B. Is also called depreciation.

C. Is also called amortization.

D. Is an unrealized expense reported in equity.

E. Is the process of allocating the cost of intangibles to periods in which they are used.

 

 

86. A company purchased a tract of land for its natural resources at a cost of $1,500,000. It expects to mine 2,000,000 tons of ore from this land. The salvage value of the land is expected to be $250,000. The depletion expense per ton of ore is: 

A. $0.75

B. $0.625

C. $0.875

D. $6.00

E. $8.00

 

 

87. A company purchased a mineral deposit for $800,000. It expects this property to produce 1,200,000 tons of ore and to have a salvage value of $50,000. In the current year, the company mined and sold 90,000 tons of ore. Its depletion expense for the current period is equal to: 

A. $15,000

B. $60,000

C. $150,000

D. $56,250

E. $139,500

 

 

 

88. Amortization: 

A. Is the systematic allocation of the cost of an intangible asset to expense over its estimated useful life.

B. Is the process of allocating to expense the cost of a plant asset to the accounting periods benefiting from its use.

C. Is the process of allocating the cost of natural resources to periods when they are consumed.

D. Is an accelerated form of expensing an asset’s cost.

E. Is the same as depletion.

 

 

89. A patent: 

A. Gives its owner the exclusive right to publish and sell a musical or literary work during the life of the creator plus 70 years.

B. Is an exclusive right granted to its owner to manufacture and sell a device or to use a process for 20 years.

C. Is an exclusive right granted to its owner to manufacture and sell a device or to use a process for 50 years.

D. Is the amount by which the value of a company exceeds the fair market value of a company’s net assets if purchased separately.

E. Gives its owner the exclusive right to publish and sell a musical or literary work during the life of the creator plus 17 years.

 

 

90. A copyright: 

A. Gives its owner the exclusive right to publish and sell a musical or literary work during the life of the creator plus 70 years.

B. Is an exclusive right granted to its owner to manufacture and sell a device or to use a process for 17 years.

C. Is an exclusive right granted to its owner to manufacture and sell a device or to use a process for 50 years.

D. Is the amount by which the value of a company exceeds the fair market value of a company’s net assets if purchased separately.

E. Gives its owner the exclusive right to publish and sell a musical or literary work during the life of the creator plus 17 years.