Question

1. The term used to reduce the value of an intangible asset is

   		Depreciation
   		Amortization
   		Depletion
   		None of these

2.65 points   

QUESTION 2

1. The term fixed asset cannot be applied to items which can be move

   True

   False

2.65 points   

QUESTION 3

1. Fixed assets tend to change constantly in amount and composition

   True

   False

2.65 points   

QUESTION 4

1. When one company buys another for more than the net book value of the acquired organization the following is created

   		goodwill
   		patents
   		copyrights
   		loss on acquisition

2.65 points   

QUESTION 5

1. Accounts Receivable is a non-current asset

   True

   False

2.65 points   

QUESTION 6

1. The book value of an asset indicates the asset's fair market value at that time.

   True

   False

2.65 points   

QUESTION 7

1. A company in the computer industry is experiencing continuously lower costs. Which cost flow assumption will result in less income tax expense for this company?

   		FIFO
   		LIFO
   		Average

2.65 points   

QUESTION 8

1. When the Allowance for Doubtful Accounts appears on a company's financial statements, its balance will be a __________ balance.

   		Debit
   		Credit

2.65 points   

QUESTION 9

1. Average cost method is rarely used in a perpetual inventory system

   True

   False

2.65 points   

QUESTION 10

1. Which one of the following would be a fixed asset for a car dealership?

                  

     

   		Office equipment
   		Accounts Receivables
   		Motor vehicles for sale
   		Cash

Answer 1

Question 1

Amortization

Amortization is the used for intangible asset for reducing the value

Question 2

False

Fixed asset can be moved from one place to other place

Question 3

False

Fixed asset wont change constantly , it will be fixed over a time period

Question 4

Goodwill

Goodwill is the value paid over and above the netbook value of an asset

Question 5

False

Account receivable is a current asset,

Question 6

False

Faie value can be changed according to the market situations, book value is the amount which it is bought or acquired

Question 7

FIFO

The cost are reducing and current income less oldest cost will give less profit that shows less tax payable

Question 8

Credit

When the Allowance for Doubtful Accounts appears on a company's financial statements, its balance will be a credit balance

Question 9

True

In perpetual inventory system another techniques are mostly used than average cost method

Question 10

Office equipment

For a car dealership the office setup is to be treated as fixed asset and no revenue is earned directly from office equipment