College Accounting, Chapters 1-15, Loose-Leaf Version
22nd Edition
ISBN: 9781305667631
Author: James A. Heintz, Robert W. Parry
Publisher: South-Western College Pub
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Question
Chapter 18, Problem 1TF
To determine
Indicate whether the given statement is true or false.
Expert Solution & Answer
Answer to Problem 1TF
The given statement is false.
Explanation of Solution
Long-term assets: The assets which are used to generate revenue for the business operations for a number of accounting periods are referred to as long-term assets.
Description: All the long-term assets wear-out gradually, except land. Land is the long-term asset that has unlimited useful life, hence, it is not
Conclusion
Thus, the given statement is false as long-term assets either wear out gradually or consumed completely.
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Intangible assets are amortized when:
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Chapter 18 Solutions
College Accounting, Chapters 1-15, Loose-Leaf Version
Ch. 18 - Prob. 1TFCh. 18 - Prob. 2TFCh. 18 - Depreciation is a process of asset valuation; that...Ch. 18 - The straight-line method of depreciation allocates...Ch. 18 - Prob. 5TFCh. 18 - Prob. 1MCCh. 18 - Prob. 2MCCh. 18 - Prob. 3MCCh. 18 - Prob. 4MCCh. 18 - Prob. 5MC
Ch. 18 - The following costs were incurred to purchase a...Ch. 18 - Prob. 2CECh. 18 - Prob. 3CECh. 18 - Grandorf Company replaced the engine in a truck...Ch. 18 - Prepare journal entries for the following...Ch. 18 - Prob. 6CECh. 18 - Prob. 7CECh. 18 - Prob. 1RQCh. 18 - Prob. 2RQCh. 18 - Prob. 3RQCh. 18 - What is meant by the depreciable cost of a plant...Ch. 18 - Prob. 5RQCh. 18 - Prob. 6RQCh. 18 - Prob. 7RQCh. 18 - Prob. 8RQCh. 18 - Prob. 9RQCh. 18 - Prob. 10RQCh. 18 - Prob. 11RQCh. 18 - Prob. 12RQCh. 18 - Prob. 13RQCh. 18 - Prob. 14RQCh. 18 - Prob. 15RQCh. 18 - Prob. 16RQCh. 18 - Prob. 17RQCh. 18 - Prob. 18RQCh. 18 - Prob. 19RQCh. 18 - Prob. 20RQCh. 18 - Prob. 21RQCh. 18 - Prob. 22RQCh. 18 - Prob. 1SEACh. 18 - STRAIGHT-LINE, DECLINING-BALANCE, AND...Ch. 18 - UNITS-OF-PRODUCTION METHOD The truck purchased in...Ch. 18 - Prob. 4SEACh. 18 - JOURNAL ENTRIES: DISPOSITION OF PLANT ASSETS...Ch. 18 - Prob. 6SEACh. 18 - STRAIGHT-LINE, DECLINING-BALANCE,...Ch. 18 - UNITS-OF-PRODUCTION METHOD A machine is purchased...Ch. 18 - CALCULATING AND JOURNALIZING DEPRECIATION...Ch. 18 - IMPACT OF IMPROVEMENTS AND REPLACEMENTS ON THE...Ch. 18 - DISPOSITION OF ASSETS: JOURNALIZING Mitchell Parts...Ch. 18 - DEPLETION: CALCULATING AND JOURNALIZING Mineral...Ch. 18 - INTANGIBLE LONG-TERM ASSETS Track Town Co. had the...Ch. 18 - Prob. 1SEBCh. 18 - STRAIGHT-LINE, DECLINING-BALANCE, AND...Ch. 18 - Prob. 3SEBCh. 18 - Prob. 4SEBCh. 18 - JOURNAL ENTRIES: DISPOSITION OF PLANT ASSETS...Ch. 18 - Prob. 6SEBCh. 18 - STRAIGHT-LINE, DECLINING-BALANCE,...Ch. 18 - UNITS-OF-PRODUCTION METHOD A machine is purchased...Ch. 18 - CALCULATING AND JOURNALIZING DEPRECIATION...Ch. 18 - IMPACT OF IMPROVEMENTS AND REPLACEMENTS ON THE...Ch. 18 - DISPOSITION OF ASSETS: JOURNALIZING Mayer Delivery...Ch. 18 - DEPLETION: CALCULATING AND JOURNALIZING Mining...Ch. 18 - Prob. 13SPBCh. 18 - Prob. 1MYWCh. 18 - Creative Solutions purchased a patent from Russell...Ch. 18 - On April 1, 20-3, Kwik Kopy Printing purchased a...Ch. 18 - Prob. 1CP
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Similar questions
- True or False Over the life of a depreciable asset, its recorded cost decreases, the related accumulated depreciation increases, and its book value remains constantarrow_forwardWhich of the following best describes depreciation?A It is a means of spreading the payment for the asset over its total estimated lifeB It represents the decline in the market value of the assetC It is a means of spreading the cost of an asset over its estimated useful lifeD It is a way of estimating the cash needed to replace the asset in the futurearrow_forwardDo the fixed assets lose their value even though they continue to function and contribute to the engineering projects? Explain how?arrow_forward
- The write-off of the cost of plant and equipment is called a.amortization. b.depletion. c.depreciation. d.deteriorationarrow_forwardIt is the gradual diminution of the useful value of tangible property resulting from wear and tear and normal obsolescence. It is also applied to the amortization of intangible assets the use of which in the trade or business is definitely limited in duration. Group of answer choices Depreciation Depletion Obsolescence Bad debtsarrow_forwardLong-term assets can include investments such as the purchase of new equipment, the replacement of old machinery, the expansion of operations into new facilities, or even the expansion into new products or markets. True / Falsearrow_forward
- LO1 The purpose of depreciation is to (a) spread the cost of an asset over its useful life. (b) show the current market value of an asset. (c) set up a reserve fund to purchase a new asset. (d) expense the asset in the year it was purchased.arrow_forwardPlease answer the question: What is the benefit of increasing fixed assets over current ones?arrow_forwardImpairment of a long-term operating asset occurs when ________. Group of answer choices an asset or part of an asset is removed from the asset portfolio an asset's total future cash-generating ability falls below its carrying value there is a failure to meet the legal obligations or conditions of a loan by which that asset was acquired the carrying value of the asset is systematically reduced over its useful economic lifearrow_forward
- Does the balance in the Accumulated Depreciation— Machinery account represent funds to replace the machinery when it wears out? If not, what does it represent?arrow_forwardIntangibles have either a limited useful life or an indefiniteuseful life. How should these two different types ofintangibles be amortized?arrow_forwardWhat element must be present when determining if an asset is a depreciating asset?  a. An asset that holds its value for a period of time or increases in value for a period.  b. An asset that has a limited effective life.  c. A fixture that completely loses its value.  d. An asset that cannot reasonably be expected to decline in value over time.arrow_forward
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