Question : 51.In accounting, depreciation refers to the a. allocation of asset cost. b. : 1244519

51.In accounting, depreciation refers to the

 

a.

allocation of asset cost.

b.

wearing away of an asset.

c.

decline in value of an asset.

d.

obsolescence of an asset.

 

 

 

52.Which of the following assets is not subject to depreciation?

 

a.

Store fixtures

b.

Land

c.

Computers

d.

Art equipment

 

 

 

53.Which of the following accounts is a contra account?

 

a.

Accumulated Depreciation–Office Furniture

b.

Interest Payable

c.

Depreciation Expense–Office Furniture

d.

Unearned Revenue

 

 

 

 

 

54.The carrying value of a depreciable asset equals

 

a.

original cost minus depreciation expense for the current period.

b.

original cost minus accumulated depreciation.

c.

the estimated cost to replace the asset.

d.

the estimated amount that the asset could be sold for.

 

 

 

55.Which of the following pairs of accounts could not possibly appear in the same adjusting entry?

 

a.

Revenue from Services and Accounts Receivable

b.

Revenue from Services and Unearned Revenue

c.

Rent Expense and Rent Payable

d.

Interest Income and Interest Payable

 

 

 

56.Failure to adjust for accrued wages at year end will result in an

 

a.

overstatement of liabilities.

b.

understatement of assets.

c.

understatement of stockholders’ equity.

d.

overstatement of net income.

 

 

 

57.Failure to record depreciation at year end will result in an

 

a.

overstatement of total liabilities.

b.

understatement of total liabilities.

c.

overstatement of total assets.

d.

understatement of net income.

 

 

 

58.The principal difference between depreciation expense and most other types of expenses is that depreciation

 

a.

is not necessarily recorded in the same period as the related cash outlay.

b.

can be avoided if the asset is in as good condition as when it was purchased.

c.

is not deductible if it will cause a net loss.

d.

is subject to more precise measurement.

 

 

 

 

 

59.Use this information to answer the following question.

 

The trial balance for Tsung Corporation appears as follows:

 

 

If on December 31, 20×7, supplies on hand were $20, the adjusting entry would contain a

 

a.

debit to Supplies for $20.

b.

credit to Supplies for $20.

c.

credit to Supplies Expense for $130.

d.

debit to Supplies Expense for $130.

 

 

 

60.Use this information to answer the following question.

 

The trial balance for Tsung Corporation appears as follows:

 

 

If on December 31, 20×7, the insurance still unexpired amounted to $20, the adjusting entry would contain a

 

a.

credit to Prepaid Insurance for $30.

b.

credit to Prepaid Insurance for $20.

c.

debit to Prepaid Insurance for $30.

d.

debit to Insurance Expense for $20.