Investing activities include the acquisition and disposition of assets. Provide four specific examples. Why purchase of inventory is not considered as investing activities
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Investing activities include the acquisition and disposition of assets. Provide four specific examples. Why purchase of inventory is not considered as investing activities
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- What is the name of the accounting concept or principle that determines the amount initially entered into the accounting records for purchases of assets--what you actually pay for the asset or what it actually costs? Group of answer choices cost concept asset concept business entity concept proprietorship concept1) Complete an inventory valuation using both the LIFO and FIFO methods and make an educated choice about which method makes the most sense given the corporation's industry. 2) Calculate the accumulated amortization of three Capital assets using the straight line amortization method.Also known as the historical cost principle, ________ states that everything the company owns or controls (assets) must be recorded at their value at the date of acquisition. A. revenue recognition principle B. expense recognition (matching) principle C. cost principle D. full disclosure principle
- Asset Valuation and Income Recognition. Asset valuation and recognition of net income closely relate. Explain, including conditions when they do not.If a company reports a gain/(loss) from the sale of assets, as part of the net income on the income statement, and the net book value of those assets on the date of the sale is known, can the amount of the cash proceeds from the sale be determined? If so, how?Which of the following is a correct statement? Inventory is not part of the current assets because they are physical in nature. Plant, equipment, building and land are non-current assets, but not fixed assets. Marketable securities such as stocks & bonds are current assets. Cash is the only liquid asset. Physical assets are financed by equity only.
- Explain the nature of lump-sum purchases including the factor(s) to be considered and the process/steps to properly account for and reflect the newly acquired assets on the balance sheet.Costs to be capitalized in the inventory account include which of the following? a. Cost of the inventory b. Transportation costs c. Taxes d. Installation e. All of the aboveIf a company purchases inventory with cash, does the total asset balance change ? Explain briefly.
- Investing activities include the acquisition and disposition of assets. Provide three specific examples. Identify two exceptions.Which of the following types of interest cost incurred in connection with the purchase or manufacture of inventory should be capitalized as a product cost? A. Purchase discounts lost B. Interest incurred during the production of discrete projects such as ships or real estate projects C. Interest incurred on notes payable to vendors for routine purchases made on a repetitive basis D. All of these should be capitalized.Choose the correct. How are assets to be reported when the liquidation basis of accounting is being applied?a. At cost less accumulated depreciation.b. At the estimated amount of cash to be received.c. At fair value.d. At the lower of cost or market value.
