Capital Management Exam

5 Questions | Total Attempts: 34

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Management Exam Quizzes & Trivia

This is may Flor's Exam


Questions and Answers
  • 1. 
    PP&E balance sheet accounts include
    • A. 

      – Land

    • B. 

      – Equipment

    • C. 

      – CWIP

    • D. 

      – All of the above

    • E. 

      – None of the above

  • 2. 
    If a building has been erected, all wiring is complete, all ductwork is in place, the windows are installed, and the doors are yet to be put in place, it is company policy to go ahead and put that building on the asset ledger to begin depreciation
    • A. 

      – True

    • B. 

      False

  • 3. 
    Which of the following are reasons why fully depreciated assets should remain on the asset sub-ledger?  Note all that apply
    • A. 

      – Property tax

    • B. 

      – Fully depreciated assets should not remain on the sub-ledger

    • C. 

      – Insurance premiums

    • D. 

      – Control accuracy

    • E. 

      – Cost center should not be charged the expense incurred with the removal of the asset from the ledger

  • 4. 
    Ø Plant A receives approval to refurbish the cafeteria for a total cost of $300,000.  As part of the project, the site purchases a new refrigerator for $2,000.  The refrigerator is expected to be in service for 5 years.  The local capitalization threshold is $5,000.
    • A. 

      O Yes, refrigerator should be capitalized as an integral part of the cafeteria refurbishment.

    • B. 

      O No, it does not meet the capitalization threshold

  • 5. 
    Ø Site X plans to buy 100 office chairs at US$150 each (total: US$15,000) to replace the worn out ones. Local capitalization threshold is at US$5,000. Should the chairs be capitalized?
    • A. 

      O Yes, the total cost is beyond the capitalization threshold

    • B. 

      O No, they do not individually meet the capitalization threshold