If answered within 40mins,it would be appreciable!! Denny Company uses accrual accounting and issues monthly financial statements On October 1, 2020, Denny Company purchases equipment for $50,000 cash. During October 2020, the fair market value of the equipment drops to $30,000. Under the concept of impairment, Denny should Group of answer choices write down the asset to $30,000 on the October 31, 2020, balance sheet if the decline in value is a temporary decline. write down the asset on its November 30, 2020, balance sheet if the decline in value is a permanent decline. not write down the asset to $30,000 under any circumstances since this would impact how investors view the company. write down the asset on its October 31, 2020, balance sheet to $30,000 in October 2020 if the decline in market value is a permanent decline. George's Garbage Collection Company provides garbage collection services. The company uses accrual accounting and issues monthly financial statements. On November 1, 2020, the company spent $5,000 to replace the engine of one of its garbage trucks. If the $5,000 is recorded as a revenue expenditure, Group of answer choices the book value of the equipment will be overstated on its November 30, 2020, balance sheet. the company's November 2020 net income will be understated. the company's November 2020 net income will be correctly stated. the company's November 2020 net income will be overstated
Depreciation Methods
The word "depreciation" is defined as an accounting method wherein the cost of tangible assets is spread over its useful life and it usually denotes how much of the assets value has been used up. The depreciation is usually considered as an operating expense. The main reason behind depreciation includes wear and tear of the assets, obsolescence etc.
Depreciation Accounting
In terms of accounting, with the passage of time the value of a fixed asset (like machinery, plants, furniture etc.) goes down over a specific period of time is known as depreciation. Now, the question comes in your mind, why the value of the fixed asset reduces over time.
If answered within 40mins,it would be appreciable!!
Denny Company uses accrual accounting and issues monthly financial statements On October 1, 2020, Denny Company purchases equipment for $50,000 cash. During October 2020, the fair market value of the equipment drops to $30,000. Under the concept of impairment, Denny should
Group of answer choices
write down the asset to $30,000 on the October 31, 2020, balance sheet if the decline in value is a temporary decline.
write down the asset on its November 30, 2020, balance sheet if the decline in value is a permanent decline.
not write down the asset to $30,000 under any circumstances since this would impact how investors view the company.
write down the asset on its October 31, 2020, balance sheet to $30,000 in October 2020 if the decline in market value is a permanent decline.
George's Garbage Collection Company provides garbage collection services. The company uses accrual accounting and issues monthly financial statements. On November 1, 2020, the company spent $5,000 to replace the engine of one of its garbage trucks. If the $5,000 is recorded as a revenue expenditure,
Group of answer choices
the book value of the equipment will be overstated on its November 30, 2020, balance sheet.
the company's November 2020 net income will be understated.
the company's November 2020 net income will be correctly stated.
the company's November 2020 net income will be overstated.
Trending now
This is a popular solution!
Step by step
Solved in 3 steps with 3 images
