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A gain is recognized on the disposal of an asset when the asset’s book value is greater than the consideration received.

The factors that need to be determined to compute depreciation are an asset’s:

Testing of new equipment should be included in the initial cost of the equipment on the balance sheet.

The cost of an intangible asset with a finite useful life is amortized.

An asset was acquired on January 1, 2021, for $78,000 with an estimated five-year life and $13,000 residual value. The company uses units-of-production depreciation and expects the asset to produce 20,000 units.  Actual production was: 2021 = 500 units; 2022 = 3,000 units; 2023 = 3,500 units; 2024 = 1,000 units. What amount will the company record for annual depreciation expense in 2023?

Cutter Enterprises purchased equipment for $72,000 on January 1, 2021. The equipment is expected to have a five-year life and a residual value of $6,000.Using the double-declining-balance method, annual depreciation expense for 2022 would be:

Property, plant, and equipment and intangible assets are long-term, revenue-producing assets.

Total depreciation is the same over the life of an asset regardless of the method of depreciation used.

The process of allocating the cost of natural resources over their useful life is known as:

When as asset is sold, if cash received is less than the book value of the asset, the company would record a: