Purchase Solution

Classification into asset/expense

Not what you're looking for?

Ask Custom Question

For each of the following expenditures, indicate the type of account (asset or expense) in which the expenditure should be recorded. Explain your answers.
A. $200 for repairing damage that resulted from the careless unloading of a new machine.
B. $ 7,000 cost of designing and registering a trademark.
C. $ 1,400 in legal fees incurred to perform a title search for the acquisition of land.
D. $400 cost of patching a leak in the roof of a building.
E. $90,000 cost of salaries paid to the research and development staff.

Purchase this Solution
Solution Summary

For the following expenditures the solution indicate the type of account (asset or expense) in which the expenditure should be recorded.

Solution Preview

For each of the following expenditures, indicate the type of account (asset or expense) in which the expenditure should be recorded. Explain your answers.

A. $200 for repairing damage that resulted from the careless unloading of a new machine.

EXPENSE

The cost of an item of asset comprises its purchase price, and any directly attributable cost of bringing the asset to its working condition for its intended use. Here the cost incurred due to careless unloading of a new machine cannot be construed to be bringing the machine to its working condition or its intended use.

If the cost was initial delivery and handling costs it would have been ...

Purchase this Solution
Free BrainMass Quizzes
Marketing Research and Forecasting

The following quiz will assess your ability to identify steps in the marketing research process. Understanding this information will provide fundamental knowledge related to marketing research.

Organizational Leadership Quiz

This quiz prepares a person to do well when it comes to studying organizational leadership in their studies.

Social Media: Pinterest

This quiz introduces basic concepts of Pinterest social media

Six Sigma for Process Improvement

A high level understanding of Six Sigma and what it is all about. This just gives you a glimpse of Six Sigma which entails more in-depth knowledge of processes and techniques.

Motivation

This tests some key elements of major motivation theories.

View More Free Quizzes
Related BrainMass Solutions

  • Various Accounting Multiple Choice

    190674 Questions about classification of accounts in the AIS 1. The Equipment account's proper classification is: a. Revenue b. Liability c. Expense d. Asset 2. The Supplies account's proper classification is: a. Asset b.

  • NPV: Keep 3/4/5/6 years, equivalent annuity, MACRS real property

    You place a commercial building into service on February 27th, 2015 costing $3,202,000. What is the depreciation expense allowed by the IRS for this building for tax years 2015? _____________And 2016?

  • Adjusting entries and classification of accounts

    Expense Sales Income Statement - Revenue The solution explains the adjusting entries and the account classification of the given transactions

  • Adjustments and Balance Sheet Classification

    The difference of 23,000 is expired and so is an expense. The entry is Insurance Expense Dr 23,000 Prepaid Insurance Cr 23,000 Expense will reduce equity and asset will reduce.

  • Account classification

    The solution explains the classification of the given accounts

  • Classifying Cost

    / Assets as these are used in production Cost to rent office space GS&A / Expense The solution explains the cost classification of the given costs

  • Classification of accounts

    The solution classifies accounts according to type (Asset, Liability, Equity, Revenue, Expense) and indicates on which financial statement (Income Statement, Balance Sheet) that account is reported.

  • Multiple choice

    (c) 2,5 The chart classification is 1- Assets, 2- Liabilities, 3 - Equity, 4-Revenue and 5-Expenses 2. a) an asset is credited and a liabilty is debited When the payment is made, cash reduces so is credited (asset) and the notes payable (liability

  • Hahn Company study questions

    should be reported as a separate classification on the balance sheet <-- we report intangibles separately and we report their accumulated amortization right under the intangible asset. C.

  • Fundamental Accounting Principles

    An individual classification may be used more than once, or not at all. Treatments A. Record the expenditure as an asset and depreciate it. B. Record the expenditure as an asset and amortize it. C.

View More Related Solutions