1. Unit VII Flashcards
Chapter 10

2. Accelerated depreciation method#1
Accelerated depreciation method
Review
A depreciation method that
expenses more of the asset’s cost
near the start of its useful life and
less at the end of its useful life.
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3. Double-declining-balance method#2
Review
An accelerated depreciation method
that computes annual depreciation
by multiplying the depreciable
asset’s decreasing book value by a
constant percent that is two times
the straight-line depreciation rate.
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4. Amortization Review #3 SHOW NEXT The process by which
businesses spread the allocation of
an intangible asset’s cost over
its useful life.
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5. Capital expenditure Review #4 SHOW NEXT
An expenditure that increases the
capacity or efficiency of a plant
asset or extends its useful life.
Capital expenditures are debited
to an asset account.
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6. Copyright Review #5 Exclusive right to reproduce
and sell a book, musical
composition, film, other work of
art or intellectual property.
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7. Depletion Review #6 SHOW NEXT The process by which businesses
spread the allocation of a natural
resource’s cost over its usage.
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8. Depreciable cost Review #7 The cost of a plant asset minus its
estimated residual value.
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9. Review The process by which businesses#8
Depreciation
Review
The process by which businesses
spread the allocation of a plant
asset’s cost over its useful life.
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10. Review #9 Intangible asset SHOW NEXT
An asset with no physical form that
is valuable because of the special
rights it carries.
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11. Modified Accelerated Cost Recovery System (MACRS)
#10
Modified Accelerated Cost Recovery System (MACRS)
Review
A depreciation method that is used
for tax purposes.
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12. Relative-market-value method
#11
Relative-market-value method
Review
A method of allocating the total
cost (100%) of multiple assets
purchased at one time. Total cost is
divided among the assets according
to their relative market values.
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13. Review #12 Straight-line method SHOW NEXT A depreciation method that
allocates an equal amount of
depreciation each year.
(Cost − Residual value) / Useful life.
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14. Reference Miller-Nobles, T. , Mattison, B. , & Matsumura, E. M. (2016)
Reference Miller-Nobles, T., Mattison, B., & Matsumura, E. M. (2016). Horngren’s accounting (11th ed.). Upper Saddle River, NJ: Pearson.
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