Salvage value is: O Also called residual value O Also called scrap value O An estimate of the asset's value at the end of its benefit period O A factor relevant to determining depreciation O All of the above

Salvage value is: O Also called residual value O Also called scrap value O An estimate of the asset's value at the end of its benefit period O A factor relevant to determining depreciation O All of the above

College Accounting, Chapters 1-27

23rd Edition

ISBN:9781337794756

Author:HEINTZ, James A.

Publisher:HEINTZ, James A.

Chapter5: Adjusting Entries And The Work Sheet

Section: Chapter Questions

Problem 4TF: LO1 Depreciable cost is the difference between the original cost of the asset and its accumulated...

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Question

Salvage value is:
O Also called residual value
Also called scrap value
O An estimate of the asset's value at the end of its benefit period
O A factor relevant to determining depreciation
O All of the above

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The estimated economic life of an asset is also known as ________. A. residual value B. book value C. salvage life D. useful life
LO1 Depreciable cost is the difference between the original cost of the asset and its accumulated depreciation.
Residual value is: A. Also called residual value.B. Also called scrap value.C. An estimate of the asset's value at the end of its benefit period.D. A factor relevant to determining depreciation.E. All of these.
The difference between the purchase cost of an asset and its value at the end of the life is known as a. Residual value b. Scrap Value c. Depreciable cost d. Amortization cost
An estimate of how an asset will be used up over its useful life is known as what? a. Depreciation rate b. Impairment value c. Useful life d. Salvage value
Which of the following statements if not true? a. Depreciation is the process of allocating the purchase price of an asset minues its residual value to expense, for each period benefited by the asset. b. The cost of an asset includes all acquisition costs necessary to obtain the benefits to be derived from the asset. c. The service life of an asset is the measure of the number of years of service expected from the asset before its disposal. d. The residual value of an asset is the difference between the expected book value of the asset at the end of its service and the cost of disposal.
The difference between cost of the asset and residual value is known as a . Depletion b . Salvage value c . Total cost of the asset . d . Depreciable cost
The book value of an asset is defined as ____________________. a. Estimated fair market value b. Cost –Accumulated depreciation c. Cost – salvage – accumulated depreciation d. Cost- Salvage value
Depreciation expense is calculated using its cost, estimates of an asset's salvage value, and an estimated useful life. True or False?
Which of the following best describes the higher of an asset's net selling price and its value in use? Select one: a. Recoverable amount b. Depreciable amount c. Revalued amount d. Carrying value
Depreciation expense under the invenroty system is a. Based on cost minus residual value b. Basically a FIFO approach to depreciable asset accounting c. The result of applying a depreciation rate to the original cost d. A measure of the change in the value of the depreciable asset
A) What is residual value? Support your answer with an example ( word count 100) B) In practise, would you expect the depreciation expense for a non-current asset to be overestimated or underestimated? Explain why this is the case.