8 1 multiple choice questions 1 which of the following is a not characteristic of pr 4306249

8 1 multiple choice questions 1 which of the following is a not characteristic of pr 4306249

8.1   Multiple Choice Questions

1) Which of the following is a not characteristic of property, plant and equipment (PPE)?

A) PPE are tangible items.

B) PPE benefit more than one year.

C) PPE are held for use in the ordinary course of business.

D) PPE have fixed and determinable future cash flows.

2) What costs should be capitalized to 'land'?

A) Construction permits.

B) Engineering surveys.

C) Property transfer tax.

D) Interest during construction.

3) Which of the following is not a characteristic of property, plant and equipment (PPE)?

A) PPE are held for sale in the ordinary course of business.

B) PPE are held for administrative purposes of the business.

C) PPE are held for use in the ordinary course of business.

D) PPE are held for rental to others by the business.

4) What is the accounting treatment recommended under IFRS for interest capitalization for property, plant and equipment (PPE)?

A) Capitalize cost of debt directly attributable to construction of the PPE.

B) Capitalize cost of internal funds directly attributable to construction of the PPE.

C) Expense cost of debt directly attributable to construction of the PPE.

D) IFRS does not provide any specific guidance for interest capitalization.

5) Which of the following is not a characteristic of a property, plant and equipment (PPE)?

A) No physical substance.

B) Identifiable.

C) Non-monetary.

D) Provides future cash flows.

6) On January 1, 2011, BigBen purchased a machine, incurring the expenditures listed below. The machine had an estimated useful life of 10 years, and BigBen uses straight-line depreciation for its equipment.

Invoice cost of machine

$100,000

Shipping costs paid

15,000

Preparing concrete platform to support machine

10,000

Testing of machine prior to general use

30,000

What amount should be capitalized as the cost of the machinery for 2011?

A) $100,000

B) $110,000

C) $115,000

D) $155,000

7) What costs should not be capitalized to 'building'?

A) Construction permits.

B) Engineering surveys.

C) Property transfer tax.

D) Interest during construction.

8) What costs should not be capitalized to 'building'?

A) Demolition of old structures.

B) Engineering surveys.

C) Interest during construction.

D) Construction permits.

9) What costs should not be capitalized to 'equipment'?

A) Non-refundable sales tax.

B) Refundable sales tax.

C) Interest during construction of equipment.

D) Transportation and delivery.

10) What costs should not be capitalized to 'equipment'?

A) Non-refundable sales tax.

B) Equipment purchase cost.

C) General training.

D) Transportation and delivery.

"Get 15% discount on your first 3 orders with us"
Use the following coupon
"FIRST15"

Order Now

Related Posts