ACCT 1120 CHAPTER 10 REVIEW TOPICS

Bring a calculator, pencil, and your one page of notes you can use during the test
(handwritten, can use both sides).

Scan through Ch. 10, pages 530-560 again to review basics (you dont need
to do the Appendix there will not be questions on the test from that)
Review vocabulary, page 563
Review the powerpoint on Ch. 10
You can use the pretests and/or posttests to review for this test log in to
myaccountinglab, choose click on Assignments then Take a Quiz/Test
scroll down the page to see these pre and posttests for each chapter.
Review the summary problem on pages 562-563
Review Land and Land Improvements and what items are included in the cost
of each (remember that Land does not depreciate, but Land
Improvements do depreciate).
Review Buildings, Machine & Equipment, and Furniture & Fixtures and what
items are included in the cost of each.
Review the Lump-Sum Purchase procedure and know why it is sometimes
necessary to do this to allocate the proper cost to each asset in a lump sum
purchase, page 534
Know the difference between Capital and Revenue Expenditures (page 536)
capital expenditures extend the life of an asset and are debited to the asset
revenue expenditures are ordinary repairs and maintenance and are debited
to expense accounts.
Review examples of capital and revenue expenditures on page 536.
Review how to calculate depreciation using the 3 methods: straight-line, units
of production, and double declining balance, pages 536-543
Review how to calculate partial year depreciation, pages 543-544.
Know how to handle various situations of how a plant asset may be disposed
of, know how to calculate book value and recognize gains and losses, pages
546-551.
Review the four steps for discarding a plant asset in various ways (fully
depreciated asset that nothing was received for when it was discarded, asset
with a residual or book value remaining when it was discarded without
receiving anything for it, getting more cash than the book value when
discarding the asset, getting less cash than the book value when discarding
the asset). Review how to account for gains and losses in these situations,
(see text or Ch. 10 PowerPoint)
Know the accounts used to account for depreciation for plant assets, natural
resource assets, pages 552-553, and intangible assets, pages 553-555
review what accounts to debit and credit for the various types of entries.
Review the concept of Goodwill, pages 555-556.
Review the accounting basics about natural resource assets (these deplete,
they dont depreciate)
Review the accounting basics about intangible assets (they amortize, they
dont depreciate or deplete and there isnt a contra account for these, the
asset is directly credited when recording annual amortization.)

Review how to calculate and interpret the Asset Turnover Ratio, page 557
(the higher the better on this ratio).