Depreciation:
A. Measures the decline in market value of an asset.
B. Measures physical deterioration of an asset.
C. Is an outflow of cash from the use of a plant asset.
D. Is the process of allocating the cost of a plant asset to expense.
E. Is applied to land.
Answer: D
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COGS is ______.
A. condition of goods sold B. cost of goods supplied C. condition of goods supplied D. cost of goods sold
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Answer the following statement true (T) or false (F)
Dracor Company is considering the purchase of equipment that would allow the company to add a new product to its line. The equipment is expected to cost $280,000 with a 7-year life, no salvage value, and will be depreciated using straight-line depreciation. The expected annual income related to this equipment follows. Compute the (a) payback period and (b) accounting rate of return for this equipment.Sales?$900,000?Costs:???Manufacturing$545,000??Depreciation on machine40,000??Selling and administrative expenses249,000(834,000)?Income before taxes?66,000?Income tax (30%)? ( 19,800)?Net income?$ 46,200?
What will be an ideal response?
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Answer the following statement true (T) or false (F)