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Evaluate the following statements: S1. When buildings and improvements are constructed in connection with the removal of natural resources and their usefulness is limited to the duration of the project, the depreciation should be recognized on an output basis similar to the one used for the natural resource itself. S2. The acquisition cost of wasting assets includes the purchase price and developmental costs, such as drilling costs, sinking mine shafts, and constructing roads. a. True, True b. False, True c. True, False d. False, False

Evaluate the following statements: S1. When buildings and improvements are constructed in connection with the removal of natural resources and their usefulness is limited to the duration of the project, the depreciation should be recognized on an output basis similar to the one used for the natural resource itself. S2. The acquisition cost of wasting assets includes the purchase price and developmental costs, such as drilling costs, sinking mine shafts, and constructing roads. a. True, True b. False, True c. True, False d. False, False

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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6. Evaluate the following statements: S1. When buildings and improvements are constructed in connection with the removal of natural resources and their usefulness is limited to the duration of the project, the depreciation should be recognized on an output basis similar to the one used for the natural resource itself. S2. The acquisition cost of wasting assets includes the purchase price and developmental costs, such as drilling costs, sinking mine shafts, and constructing roads.

a. True, True

b. False, True

c. True, False

d. False, False

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