Explanation 1. Plant, property, and equipment refer to the fixed assets, having a useful life of more than a year that is acquired by a company to be used in its business activities, for generating revenue. Example for property is land, example for plant is building, and example for equipment is machines. 2. Land improvements: They are the improvements that are made to a plot of land to make it more usable. These land improvements have usable lifetime, they must be depreciated over its life. If there is no way to estimate the life, then no depreciation is made to cost of land improvements. Land improvements costs are costs of establishing parking lots, driveways, and private roads. 3. Capitalize: Recording of costs such as cost incurred to purchase of equipment as an asset is known as capitalization. 4. Average accumulated expenditures: If any loan has been borrowed specifically for the construction project, the average accumulated expenditures will be computed till it reaches the amount of such specific loan. 5. Revenue: The account which is to be credited when a company receives donated assets is the revenue account. The rationale behind crediting revenue account is that the company renders service to the person who has donated the assets to the company in exchange of the assets received by it. 6. Non-monetary exchange: If an exchange (Example: exchange of land for another non-monetary asset other than land) is likely to have a change in the future cash flows, then it is known as exchange has commercial substance...

9th Edition

ISBN: 9781259722660

Author: J. David Spiceland, Mark W. Nelson, Wayne M Thomas

Publisher: McGraw-Hill Education

See similar textbooks

Question

Chapter 10, Problem 10.30E

To determine

To pair: The items of List A with the items of List B (by letter) related to tangible and intangible assets.

Expert Solution & Answer

Want to see the full answer?

Check out a sample textbook solution

See solution

Chapter 10, Problem 10.29E

Chapter 10, Problem 10.31E

Students have asked these similar questions

Project 1: NPV 13,941 IRR: 17.66% Project 2; NPV 31,261 IRR: 28.45% The questions is : Is it correct to use the IRR rule for project appraisal in this case? Why or why not?

What is the correct answer? A. P129,000 B. P135,000 C. P112,000 D. P127,600

14. Which of the following is not an intangible asset? a.Patent b.Trademark c.Research and development d.Copyright

Chapter 10 Solutions

Intermediate Accounting

Ch. 10 - Prob. 10.1Q Ch. 10 - Prob. 10.2Q Ch. 10 - Prob. 10.3Q Ch. 10 - Prob. 10.4Q Ch. 10 - Prob. 10.5Q Ch. 10 - Prob. 10.6Q Ch. 10 - When an asset is acquired and a note payable is...Ch. 10 - Explain how assets acquired in exchange for equity...Ch. 10 - Prob. 10.9Q Ch. 10 - What account is credited when a company receives...

Knowledge Booster

To pair: The items of List A with the items of List B (by letter) related to tangible and intangible assets.

Solution Summary: The author pairs the items of List A and List B related to tangible and intangible assets.

To pair: The items of List A with the items of List B (by letter) related to tangible and intangible assets.

Want to see the full answer?

Chapter 10 Solutions