Indicate whether each of the following statements is true or false.________ a) Sales taxes paid on the purchase of equipment would be expensed in the year of the purchase.________ b) Real estate fees and attorney's fees related to the purchase of a building would be added to the cost of the building.________ c) Payment of a fine for improper burning of a demolished building would be added to the land account.________ d) Delivery charges on equipment would be expensed in the year of the purchase.________ e) The matching concept requires that plant assets be recorded at the amount paid for the assets.
What will be an ideal response?
a) F b) T c) F d) F e) F
a) This is false. Sales tax is included in the cost of the asset purchased.
b) This is true. The cost of a building includes any one-time fee related to the purchase.
c) This is false. The fine would be expensed because it was not necessary to use the land. It was because of the company's own negligence.
d) This is false. The delivery charges are a necessary cost to obtain the equipment and prepare it for its initial use, so they would be added to the cost of the equipment.
e) This is false. That is a description of the historic cost concept.
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a. a single-use plan b. mission statement c. strategic objective d. vision statement
Which one of the following requires intraperiod tax allocation?
A. installment sales for tax purposes and accrued revenue recognition for accounting purposes B. the excess of accelerated depreciation for tax purposes over depreciation for accounting purposes C. interest income on municipal obligations D. prior period adjustments
Accounting information is used by creditors to decide whether to invest in a company's stock.
Answer the following statement true (T) or false (F)
If there are major failures of several large banks or many small banks, and the Federal Deposit Insurance Corporation (FDIC) insurance fund is insufficient to cover all of the depositors' losses, then the U.S
government will pay the depositors the money owed by the FDIC. Indicate whether the statement is true or false