Financial And Managerial Accounting
15th Edition
ISBN: 9781337902663
Author: WARREN, Carl S.
Publisher: Cengage Learning,
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Chapter 9, Problem 7DQ
(A)
To determine
Explain whether it is necessary for a business to use the same method of computing
(B)
To determine
Explain whether it is necessary for a business to use the same method of computing depreciation for financial statement purposes and in determining income taxes.
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Which of the following would be considered by the CRA to be business income
rather than property income or capital gains?
Profits from the sale of assets that were used to produce business income
Profit from the sale of assets that were used to produce property income
Profit from the sale of inventory items
Both A and C
How should the disposal of a component of a business bedisclosed in the income statement?
How does the concept of depreciation affect the financial statements of a company, and what methods are commonly used to calculate depreciation?
Chapter 9 Solutions
Financial And Managerial Accounting
Ch. 9 - ONeil Office Supplies has a fleet of automobiles...Ch. 9 - Prob. 2DQCh. 9 - Prob. 3DQCh. 9 - Prob. 4DQCh. 9 - Prob. 5DQCh. 9 - Keyser Company purchased a machine that has a...Ch. 9 - Prob. 7DQCh. 9 - A. Under what conditions is the use of an...Ch. 9 - Prob. 9DQCh. 9 - Prob. 10DQ
Ch. 9 - Straight-line depreciation A building acquired at...Ch. 9 - Units-of-activity depreciation A truck acquired at...Ch. 9 - Double-declining-balance depreciation A building...Ch. 9 - Revision of depreciation Equipment with a cost of...Ch. 9 - Capital and revenue expenditures On February 14,...Ch. 9 - Sale of equipment Equipment was acquired at the...Ch. 9 - Prob. 7BECh. 9 - Prob. 8BECh. 9 - Fixed asset turnover ratio Select financial...Ch. 9 - Costs of acquiring fixed assets Melinda Stoffers...Ch. 9 - Prob. 2ECh. 9 - Prob. 3ECh. 9 - Nature of depreciation Tri-City Ironworks Co....Ch. 9 - Straight-line depreciation rates Convert each of...Ch. 9 - Straight-line depreciation A refrigerator used by...Ch. 9 - Depreciation by units-of-activity method A...Ch. 9 - Depreciation by units-of-activity method Prior to...Ch. 9 - Depreciation by two methods A Kubota tractor...Ch. 9 - Depreciation by two methods A storage tank...Ch. 9 - Partial-year depreciation Equipment acquired at a...Ch. 9 - Revision of depreciation A building with a cost of...Ch. 9 - Prob. 13ECh. 9 - Prob. 14ECh. 9 - Prob. 15ECh. 9 - Capital expenditure and depreciation Willow Creek...Ch. 9 - Entries for sale of fixed asset Equipment acquired...Ch. 9 - Disposal of fixed asset Equipment acquired on...Ch. 9 - Prob. 19ECh. 9 - Kleen Company acquired patent rights on January 10...Ch. 9 - Prob. 21ECh. 9 - Prob. 22ECh. 9 - Asset traded for similar asset A printing press...Ch. 9 - Prob. 24ECh. 9 - Prob. 25ECh. 9 - Prob. 26ECh. 9 - Prob. 1PACh. 9 - Comparing three depreciation methods Dexter...Ch. 9 - Depreciation by three methods; partial years...Ch. 9 - Depreciation by two methods; sale of fixed asset...Ch. 9 - Transactions for fixed assets, including sale The...Ch. 9 - Prob. 6PACh. 9 - Prob. 1PBCh. 9 - Comparing three depreciation methods Waylander...Ch. 9 - Depreciation by three methods; partial years...Ch. 9 - Depreciation by two methods; sale of fixed asset...Ch. 9 - Transactions for fixed assets, including sale The...Ch. 9 - Prob. 6PBCh. 9 - Compare Amazon.com to Netflix Amazon.com, Inc....Ch. 9 - Prob. 2MADCh. 9 - Prob. 3MADCh. 9 - Compare Fed Ex and UPS FedEx Corporation (FDX) and...Ch. 9 - Prob. 5MADCh. 9 - Revising depreciation estimates Hard Bodies Co. is...Ch. 9 - Communication Godwin Co. owns three delivery...Ch. 9 - Prob. 4TIF
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- If a company reports a gain/(loss) from the sale of assets, as part of the net income on the income statement, and the net book value of those assets on the date of the sale is known, can the amount of the cash proceeds from the sale be determined? If so, how?arrow_forwardRespond to the questions related to fixed assetsarrow_forwardDiscuss the main reasons why accounting profit of a business has to be adjusted when computing taxable income.arrow_forward
- When a business calculates taxable income from gross income, which ofthe following is true? a. Depreciation, interest, and principal are all subtracted b. Depreciation and interest are subtracted, principal is not c. Depreciation is subtracted, interest and principal are not d. Interest and principal are subtracted, depreciation is not.arrow_forwardWhich of the following is used when computing for the accounting rate of return (ARR)? a. Income before depreciation but after taxes. b. Income after depreciation and taxes. c. Income before depreciation and taxes d. Income after depreciation but before taxes.arrow_forward*Hdoes a company account for the disposal of an asset?how does it report gains and losses on its financial statments. *Distinction between addition and improvment and should be a company account for eacharrow_forward
- What is the name of the accounting concept or principle that determines the amount initially entered into the accounting records for purchases of assets--what you actually pay for the asset or what it actually costs? Group of answer choices cost concept asset concept business entity concept proprietorship conceptarrow_forwardWhich of the following accounts would not be involved in preparing the income statement? Group of answer choices Tax expense All the accounts would be involved in preparing the income statement. Interest income Accumulated depreciation Depreciation expensearrow_forwardWhat is the meaning of the terms ‘depreciation’, ‘amortization’, and ‘depletion’ specified in accounting and the International Accounting Standards (IAS)/International Financial Reporting Standards (IFRS)?arrow_forward
- When a loss contingency is recognized, where is it reported on the income statement?arrow_forwardWhat is the total amount of other income reported on the Monroe's Form 1040, Schedule 1?arrow_forwardWhich of the following is an example of a tax credit available to businesses? A) Depreciation B) Net operating loss carryforward C) Research and development (R&D) tax credit D) Business expensesarrow_forward
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