4 Accounting Multiple Choice Problems (Simple)

Question 5 (1 point) Which of the following is not a major characteristic of a property, plant, and equipment asset? (a) Possesses physical substance Ob) Acquired for resale Oc) Acquired for use (d) Yields services over a number of years Question 6 (1 point) In January, 2010, Korro Corporation purchased a mineral mine for $5.1 million with removable ore estimated by geological surveys at 2 million tons. The property has an estimated value of $300,000 after the ore has been extracted. The company incurred $1.5 million of development costs preparing the mine for production. During 2010, 500,000 tons were removed and 400,000 tons were sold. What is the amount of depletion that Pratt should expense for 2010? (a) $960,000 (b) $1,200,000 Oc) $1,260,000 Od) $1,680,000Question 7 (1 point) Which of the following statements best describes when previously recognized goodwill impairment may be reversed? a) Reversals are permitted under both ASPE and IFRS. (Ob) Reversals are permitted under ASPE but not IFRS. Oc) Reversals are permitted under IFRS but not ASPE. (d) Reversals are not permitted under either IFRS or ASPE. Question 8 (1 point) A company owns assets that qualify as investment property and applies the fair value model for all such property. Assuming the assets are expected to be used for 10 years and have a year-1 book value of $100,000, depreciation expense for that year is: Oa) $10,000 Ob) nil Oc) $15,000 Od) $9,000