By the end of this section, you will be able to:
- describe the accounting and reporting of plant and intangible assets and natural resources.
- Prepare entries for cash and lump-sum purchases of property, plant and equipment.
- Define “depreciation” as the term is used by accountants.
- Identify factors that affect the determination of service life.
- Compute depreciation by using the following methods:
2. Units-of activity
3. Declining balance
- Compute book value.
- Journalize entries for disposal of property, plant and equipment assets for the following circumstances:
2. Sale of the asset
3. Trade-in of similar assets
- Define “depletion” as the term is used by accountants.
- Compute depletion for a given cost, residual value, and estimated output.
- Journalize adjusting entries for the recording of:
- Identify and describe various types of intangible assets.
- Calculate and record amortization of intangible assets