Multiple Choice: Asset Valuation Select the correct answer for each of the following:

1. Which of the following is likely to be reported at lower of cost or market?

a. Supplies inventory.

b. Finished goods inventory.

c. Prepaid expenses.

d. All of the above.

2. Which of the following is reported at an amount based on historical cost?

a. Prepaid expenses.

b. Equipment.

c. Land.

d. All of the above.

3. Inventory might be valued at:

a. Cost.

b. Replacement cost.

c. Realizable value.

d. Any of the above.

4. Tangible operating assets with limited lives normally are valued at:

a. Cost not yet allocated to periodic expense.

b. The amount paid originally.

c. Current market value.

d. Lower of cost or market.

5. The amount recorded as the cost of equipment should include:

a. Costs of shipping in the equipment.

b. Installation and preparation costs.

c. Reductions for trade discounts.

d. All of the above.