ACCT 305 DeVry Complete Quiz Package Latest

cost, residual value, and service life.
Question 4. 4. (TCO 4) Cutter Enterprises purchased equipment for $72,000 on January 1, 2011. The equipment is
expected to have a 5-year life and a residual value of $6,000. Using the straight-line method, the book value at
December 31, 2011 would be (Points : 4)
$57,600.
$51,600.
$58,800.
$52,800.
Question 5. 5. (TCO 4) Accounting for a change in the estimated service life of equipment (Points : 4)
is handled prospectively.
requires retroactive restatement of the prior year's financial statements.
requires a prior period adjustment.
is a cumulative adjustment to income in the current year for the difference in depreciation under the new versus old
estimates.
ACCT 305 DeVry Week 7 Quiz Latest
Question 1.1.(TCO 8) For the lessee to account for a lease as a capital lease, the lease must meet (Points : 4)
all four of the criteria specified by GAAP regarding accounting for leases.
any one of the six criteria specified by GAAP regarding accounting for leases.
any two of the criteria specified by GAAP regarding accounting for leases.
any one of the four criteria specified by GAAP regarding accounting for leases.
Question 2.2.(TCO 8) From the perspective of the lessee, leases may be classified as either (Points : 4)
direct-financing or sales-type.
capital or direct-financing.
capital or operating.
direct-financing or operating.
Question 3.3.(TCO 8) One of the four criteria for a capital lease specifies that the lease term be equal to or greater than
(Points : 4)
75% of the expected economic life of the leased property.
90% of the expected economic life of the leased property.
80% of the expected economic life of the leased property.
50% of the expected economic life of the leased property.