Fixed assets

Question 1

A constructed plant asset

Answer 1

capitalizes Materials, Labor, Incremental overhead, and Capitalized interest. Depreciable base is the lower of cost or fair market value

Question 2

Depreciation expense

Answer 2

Is a selling and general admin expense

Question 3

Double declining balance depreciation

Answer 3

Cost x (2/useful life) YR 2 = Cost - YR 1 dep x (2/useful life)

Question 4

Sum of the Year Digit depreciation

Answer 4

(Useful life/sum of useful life 1+2+3 ect.)x (carry value - residual value