10/13/12

1/3 https://lms-blackboard.telt.unsw.edu.au/webapps/assessment/rev iew/rev iew.jsp?attempt_id=_228

ACCT1511-Accounting and Financial Management 1B - Session 2, 2012 Online Quizzes
Review Test Submission: Quiz 1 - opens Friday 3 Aug and closes 3pm Friday 10 August
Review Test Submission: Quiz 1 - opens Friday 3 Aug and closes
3pm Friday 10 August
User Carmen LEE
Submitted 08/08/12 22:49
Status Completed
Score 3.5 out of 5 points
Time
Elapsed
29 minutes out of 35 seconds out of 30 minutes.
Instructions Complete the 10 questions within the 30 minutes. Time penalities apply - as per the course
outline.
Question 1
Speedy Ltd purchased a delivery truck on 1 July 2007 for $450,000. It had an estimated salvage
value of $150,000. The estimated number of kilometres to be driven was 150,000. The truck was
depreciated using the units-of-production method. Speedy Ltds financial period ends on 31
December. The truck was driven the following distances:
During 6 months to 31 December 2007, 25,000 km
During 12 months to 31 December 2008, 75,000 km
During 12 months to 31 December 2009, 40,000 km
What was the balance of accumulated depreciation at 31 December 2009?
Selected Answer: $280,000
Question 2
Tanner Ltd purchased an item of equipment on the first day of the financial period, 1 July 2009, for
$200,000. The equipment was depreciated using the reducing balance method and a rate of 40%.
If the machine was sold for $59,000 on 1 July 2010, what was the gain or loss on disposal?
Selected Answer: loss of $61,000
Question 3
An asset should be recognised in the financial statements when:
one: An exchange has occurred
two: It possesses a cost or other value that can be measured reliably
three: It is probable that the future economic benefits embodied in the asset will eventuate
Selected Answer: 2 and 3 only
Question 4
Norman Ltd purchased a motor vehicle for $45,000 on 1 July 2006. The vehicle was expected to
have a 4-year life and a $13,000 trade-in value, and was expected to be driven for 160,000 km. The
financial period ends on 30 June.
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10/13/12 Rev iew Test Submission: Quiz 1 - opens Friday 3 Aug and closes 3pm Friday 10 August
2/3 https://lms-blackboard.telt.unsw.edu.au/webapps/assessment/rev iew/rev iew.jsp?attempt_id=_228
Assuming Norman Ltd used the straight-line method of depreciation, the carrying amount (net book
value) at 30 June 2009 was:
Selected Answer: $8,000
Response
Feedback:
Annual depreciation expense: ($45,000 - $13,000) / 4 years = $8,000
Carrying amount (net book value) at 30 June 2009: $45,000 (3 x $8,000) =
$21,000
Question 5
Identify the accounting concept or principle that relates to the following statement:
Information must represent faithfully the transactions or events that have occurred.
Selected Answer: reliability
Question 6
Norman Ltd purchased a motor vehicle for $45,000 on 1 July 2006. The vehicle was expected to
have a 4-year life and a $13,000 trade-in value, and was expected to be driven for 160,000 km.
Assuming Norman Ltd used the reducing balance method of depreciation and a rate of 40%, the
carrying amount (net book value) at 30 June 2009 was:
Selected Answer: none of the above
Response
Feedback:
Depreciation expense for the period 1 July 2006 to 30 June 2007: $45,000 x 40%
= $18,000
Depreciation expense for the period 1 July 2007 to 30 June 2008: ($45,000 -
$18,000) x 40% = $10,800
Depreciation expense for the period 1 July 2008 to 30 June 2009: ($45,000 -
$18,000 - $10,800) x 40% = $6,480
Net book value (carrying amount) = $45,000 - $18,000 - $10,800 - $6,480 =
$9,720
Question 7
Brown Ltd purchased a machine on the first day of the financial period, 1 July 2008, for $100,000.
The machine was depreciated using the reducing balance method and a rate of 20%.
If the machine was sold for $70,000 on 1 July 2010, what was the gain or loss on disposal?
Selected Answer: gain of $6,000
Question 8
Identify the accounting concept, or principle that relates to the following statement:
To make the information in the financial statments useful to user, the information must exhibit:
Selected Answer: relevance
Response
Feedback:
Qualitative characteristics are the attributes that make the
information provided in financial statements useful to users. The
four principal qualitative characteristics are understandability,
relevance, reliability and comparability. Consequently, the most
correct answer is: d) all of the above.
Question 9
Which of the following is NOT a key point of the Framework?
Selected Answer: the concept of prudence should always take precedence over relevance
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Saturday, 13 October 2012 20:22:21 o'clock EST
Question 10
Accumulated depreciation is a(n):
Selected Answer: contra asset
OK
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