1. MC Qu.107 A piece of equipment was acquired on January...
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A piece of equipment was acquired on January 1, 2015, at a cost of $50,000, with an estimated residual value of $5,000 and an estimated useful life of ten years. The company uses the double-declining-balance method. What is its book value at December 31, 2016? |
A $10,000
B $32,000
C $9,000
D $41,000
2. MC Qu. 207 Which of the following statements is ...
Which of the following statements is correct?
A Depreciation allocates the cost of tangible assets over their useful lives.
B Depreciation allocates the cost of intangible assets over their useful lives.
C Amortization allocates the cost of tangible assets over their useful lives.
D The term "depreciation" relates to all long-lived assets whereas "amortization" relates only to intangible assets.
1.
| Year (1) | Net Book value, beginning of year (2) | Double declained depreciation (3) = (2)/Life of assets*2 | Net book value, End of the year (4) = (2)-(3) |
| 2015 | $ 50,000 | $ 10,000 | $ 40,000 |
| 2016 | $ 40,000 | $ 8,000 | $ 32,000 |
Answer is B. $32,000
2. Depreciation term will use for Tangible assets and amortization will use for Intangible assets. So answer will be D.
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