Match the Items and Explain How Each Item Should Be

question 107

Short Answer

Match the items and explain how each item should be accounted for. (Choices may be used more than once.)
a.This item should be included as part of the cost of the equipment.b.This item should be considered a revenue expenditure.
-The company financed the equipment purchase with a bank loan. Interest of $3,000 was paid on the loan during 2013.

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Definitions:

Practical Intelligence

A type of intelligence that involves the ability to solve everyday problems through adaptive or creative reasoning.

Crystallized Intelligence

The ability to use learned knowledge and experience, which typically increases with age.

Working Memory Capacity

The amount of information a person can hold and manipulate in their working memory at one time.

Mental Processes

are activities of the mind involved in thinking, understanding, learning, and remembering.