. Bullwinkle Co. acquired an adjacent vacant lot with the hope of selling it in the future at a gain. The lot is not intended to be used in Bullwinkle's business operations. Where should such real estate be listed on the balance sheet? 2. Distinguish between the accounting for capital expenditures and revenue expenditures. 3. Immediately after a used truck is acquired, a new motor is installed at a total cost of $3,850. Is this a capital expenditure or a revenue expenditure? 4. Keyser Company purchased a machine that has a manufacturer's suggested life of 20 years. The company plans to use the machine on a special project that will last 12 years. At the completion of the project, the machine will be sold. Over how many years should the machine be depreciated? 5. Is it necessary for a business to use the same method of computing depreciation for all classes of its depreciable assets and for financial statement purposes and in determining income taxes?
1. Bullwinkle Co. acquired an adjacent vacant lot with the hope of selling it in the future at a gain. The lot is not intended to be used in Bullwinkle's business operations. Where should such real estate be listed on the
2. Distinguish between the accounting for capital expenditures and revenue expenditures.
3. Immediately after a used truck is acquired, a new motor is installed at a total cost of $3,850. Is this a capital expenditure or a revenue expenditure?
4. Keyser Company purchased a machine that has a manufacturer's suggested life of 20 years. The company plans to use the machine on a special project that will last 12 years. At the completion of the project, the machine will be sold. Over how many years should the machine be
5. Is it necessary for a business to use the same method of computing depreciation
- for all classes of its depreciable assets and
- for financial statement purposes and in determining income taxes?
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