Question : 71.An asset that cost $25,000 was sold for $9,000 cash. : 1169045

 

 

71.An asset that cost $25,000 was sold for $9,000 cash. Accumulated depreciation on the asset was $16,000. The entry to record this transaction includes the recognition of   

A. a gain of $9,000.

 

B. a loss of $7,000.

 

C. neither a gain nor a loss.

 

D. a loss of $2,000.

 

 

 

72.An asset that cost $25,000 was sold for $8,000 cash. Accumulated depreciation on the asset was $16,000. The entry to record this transaction includes the recognition of   

A. a gain of $8,000.

 

B. a loss of $1,000.

 

C. neither a gain nor a loss.

 

D. a gain $1,000.

 

 

 

73.Assume that a business trades in an old cash register for a new one. Under the income tax method,   

A. a gain may be recognized, but a loss cannot be recorded.

 

B. the cost of the new asset is recorded as the cash paid for the new asset.

 

C. the asset account is debited for the difference between the original cost of the old asset and the fair market value of the new asset.

 

D. the cost of the new asset is recorded as the book value of the old asset plus the cash amount paid or to be paid.

 

 

 

 

74.Equipment that cost $20,000 was sold for $12,000 cash. Accumulated depreciation on the asset was $14,000. The entry to record the sale includes a credit to the Equipment account for   

A. $6,000.

 

B. $12,000.

 

C. $20,000.

 

D. $14,000.

 

 

 

 

75.Harrod’s Landscape Artists acquired a new truck for $42,000 less the trade-in allowance of $6,000 for his old truck. The old truck was purchased for $31,000 and had a book value of $5,000 on the exchange date. The entry to record the acquisition of the new truck will include a debit to the Truck account for   

A. $42,000.

 

B. $41,000.

 

C. $37,000.

 

D. $36,000.

 

 

 

76.Harrod’s Landscape Artists acquired a new truck for $42,000 less the trade-in allowance of $4,000 for his old truck. The old truck was purchased for $31,000 and had a book value of $5,000 on the exchange date. The entry to record the acquisition of the new truck will include a debit to the Truck account for   

A. $42,000.

 

B. $41,000.

 

C. $37,000.

 

D. $36,000.

 

 

 

77.The cost of an intangible asset   

A. should be immediately charged to expense if the cost was incurred to develop the intangible asset.

 

B. should be immediately charged to expense whether the intangible asset was developed internally or purchased.

 

C. should be recorded as an asset whose cost, like the cost of land, will not be allocated to expense.

 

D. should be charged to expense over the life of the intangible asset.

 

 

 

 

78.A company purchased equipment for $16,000 cash. In addition, the company paid $1,000 to have the equipment delivered and $500 to have it installed. The cost of this asset for financial accounting purposes is   

A. $16,000.

 

B. $17,000.

 

C. $17,500.

 

D. $16,500.

 

 

 

79.A company purchased equipment on account for $25,000. By paying within the discount period, they saved 1%. In addition, the company paid $1,500 to have the equipment delivered and $500 to have it installed. In setting up the machine, the maintenance assistant caused $300 in damages which was repaired before the machine was put into service. The cost of this asset for financial accounting purposes is   

A. $25,250.

 

B. $26,750.

 

C. $27,000.

 

D. $27,300.

 

 

 

80.An example of real property is   

A. machinery.

 

B. factory equipment.

 

C. computer equipment.

 

D. buildings.