Question

16.When constructing a depreciation schedule, the accountant must remember that the book value at the end of the asset's life must be equal to the

a. depreciable cost   

b. cost   

c. book value  

d. salvage value

17. Clark sold an asset this year for $4,000, but the book value of the asset was $7,000. What effect will this transaction have on the income statement for the year?  

A. an increase in net income  

b. a decrease in net income  

c. no effect on net income

d. we don't know

18.Social Security is a government program that   :

a. provides income to citizens after they retire  

b. pays people when they become unemployed

c. provides vacation pay to working people  

d. none of these

Answer 1

Answer 16:-When constructing a depreciation schedule, the accountant must remember that the book value at the end of the asset's life must be equal to the Salvage Value . Option D is Correct.

"Depreciable cost" are those cost on which depreciation has been charged.It is difference between Total Capitalised cost and Salvage value of assets.

"Cost" is total capitalized cost of assets.

"Book value" is cost of assets that remain at end of year after charging depreciation through period.

17:-Net income decreased by $3000 ($7000-$4000).

Option b is correct.

18:-Social security is a government program related to federal Old-Age, Survivors, and Disability Insurance (OASDI) that administered by the Social Security Administration in united states.these are 401(K) plan ,7702 plans ,pension plans etc.

Option (b) pays people when they become unemployed is correct