ACC 304 All Assignments ACC 304 All Assignments | Page 174

cause a material change in the future cash flows for either entity. If a
gain on the disposal of the old asset is indicated, the gain will
ACC 304 Week 5 Midterm Part 1 (Set 2)
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Multiple Choice Question 90
If Labor, Inc. uses the composite method and its composite rate is 7.5%
per year, what entry should it make when plant assets that originally
cost $80,000 and have been used for 10 years are sold for $24,000?
Multiple Choice Question 102
Porter Resources Company acquired a tract of land containing an
extractable natural resource. Porter is required by its purchase contract
to restore the land to a condition suitable for recreational use after it
has extracted the natural resource. Geological surveys estimate that
the recoverable reserves will be 2,000,000 tons, and that the land will
have a value of $1,000,000 after restoration. Relevant cost information
follows:
Multiple Choice Question 110