Reference no: EM132674252

Problem 1: Did the company purchase any intangible assets during the year?

a.Statement of retained earnings
b.Income statement
c.Balance sheet
d.Statement of cash flows

Problem 2: Wexford Co. purchased a new delivery truck at the beginning of 2017. The truck has a cost of $37,000, an estimated life of five years, and an estimated residual value of $7,000. A full year's depreciation expense is to be recorded in 2017. The truck was driven 20,000 miles during 2017 and 24,000 miles during 2018. The number of expected miles over five years is 100,000.

By what amount would double-declining-balance depreciation exceed straight-line depreciation over the five-year life of the truck?

a. Cost less total depreciation
b. Cost plus total depreciation
c. The residual value of $7,000
d. Total depreciation expenses under double-declining-balance and straight-line depreciation are equal.

Problem 2: Which of the following items is added to net income to determine cash flows from operating activities when the indirect method is used to prepare the Operating Activities category of the statement of cash flows?

a. Cost of plant assets acquired during the year
b. Depreciation expense
c. Cash from note payable related to truck acquired
d. Accumulated depreciation