Asset Types
These are assets that are either consumed or converted to cash during the normal operating cycle, usually one year.
This accounting principle states that expenses must be matched with the revenue earned during the same period.
This is the number of years a business expects to use an asset before it wears out or becomes obsolete.
What is estimated useful life (or service life)?
This method equally distributes the depreciation expense over the asset’s estimated useful life.
What three distinct flavors are usually used to make Neapolitan ice cream?
Vanilla, chocolate, and strawberry.
These long-lived assets are used in the production or sale of other assets or services over several accounting periods.
This is the accounting process of allocating or "spreading" the cost of a plant asset over its useful life.
This is the estimated monetary value an asset will have at the time it is replaced or discarded.
This method estimates useful life in units of use, such as miles driven, rather than units of time.
What is the symbol for copper?
Cu
This specific plant asset is never depreciated because its service life is considered unlimited and never ends.
land
The cost of a plant asset includes the purchase price, sales taxes, and these two other types of charges.
delivery and installation
This is a common alternative name for "disposal value," often used when trading in old equipment for new.
These methods are based on the theory that an asset loses more value in its early years than in its later years.
Which country is known as "The Emerald Isle"?
ireland
List two examples of plant assets besides land.
What are buildings, delivery equipment, store equipment, or office equipment?
This is the specific account that is debited at the time a plant asset is purchased.
This is why an asset’s "service life" might be shorter than its total "productive life."
This is the name of the modified system used for federal income tax reporting.
How many strings does a traditional violin have?
4
These are two common characteristics of all plant assets: they produce benefits for more than one year and they are not intended for this.
If a business pays $20,000 for a machine, $1,500 in tax, and $500 for shipping, this is the total cost recorded.
Depreciation is always considered one of these because no one can predict the exact future of an asset with certainty.
This is why MACRS is used for taxes but generally not for reporting to stockholders.
What is the Roman numeral for 40?
XL