Fundamental Accounting Principles Volume 2 17th Edition By Kermit D. Larson test bank

      
       A) $5,800.00      
       B) $6,425.00
       C) $7,050.00
       D) $5,140.00
       E) $5,640.00
      






214)       Merchant Company purchased land for a building site. The costs associated with the property were:
 



 
 
 

Purchase price
$
191,000

Real estate commissions
 
16,600

Legal fees
 
2,400

Expenses of clearing the land
 
3,600

 

 What is the total recorded cost of the land?



      
       A) $207,600
       B) $213,600
       C) $191,000
       D) $195,400
       E) $210,000
      






215)       A company purchased property for $100,000. The property included a building, a parking lot, and land. The building was appraised at $58,500; the land at $47,800, and the parking lot at $18,700. Land should be recorded in the accounting records with an allocated cost of:



      
       A) $38,240. 
       B) $47,800.
       C) $44,240.
       D) $0.
       E) $100,000.
      






216)       A company purchased a delivery van for $26,600 with a salvage value of $3,600 on October 1, Year 1. It has an estimated useful life of 5 years. Using the straight-line method, how much depreciation expense should the company recognize on December 31, Year 1?



      
       A) $1,150.   
       B) $5,320.
       C) $4,600.
       D) $1,773.
       E) $96.
      






217)       Marlow Company purchased a point of sale system on January 1 for $6,700. This system has a useful life of 5 years and a salvage value of $1,050. What would be the  depreciation expense for the second year of its useful life using the double-declining-balance method?



      
       A) $2,680.   
       B) $1,608.
       C) $1,544.
       D) $1,130.
       E) $2,260.
      






218)       A company purchased a weaving machine for $298,810. The machine has a useful life of 8 years and a salvage value of $16,500. It is estimated that the machine could produce 763,000 bolts of woven fabric over its useful life. In the first year, 111,500 bolts were produced. In the second year, production increased to 115,500 units. Using the units-of-production method, what is the amount of  depreciation expense that should be recorded for the second year?



      
       A) $83,990. 
       B) $42,735.
       C) $43,666.
       D) $41,255.
       E) $45,233.
      






219)       An asset's book value is $18,300 on December 31, Year 5. Assuming the asset is sold on December 31, Year 5 for $14,700, the company should record:



      
       A) A loss on sale of $3,600.   
       B) A gain on sale of $3,600.
       C) Neither a gain nor a loss is recognized on this transaction.
       D) A loss on sale of $13,350.