A Barn Held More Than One Year and Used in a Business

question 125

Multiple Choice

A barn held more than one year and used in a business is destroyed in a tornado. The barn originally cost $356,000 and was fully depreciated using straight-line depreciation. The barn was insured for its $543,000 replacement cost minus a deductible of $1,000. Which of the statements below is correct concerning these facts?

• A) The barn was a long-term personal use asset.
• B) There is a casualty loss from disposition of the barn.
• C) The recognized gain from disposition of the barn is $186,000.
• D) The recognized gain from disposition of the barn is subject to special netting rules.
• E) c. and d.

Distinguish between fixed budgets and flexible (variable) budgets.

Understand the concept and calculation of variances, including price and quantity variances.

Grasp the purpose and process of using standard costs in budgeting and variance analysis.

Recognize the role of management by exception in focusing managerial attention on significant variances.

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Definitions:

Stages One And Two

Typically refers to the initial phases in a multi-step process or development, often marking the foundational and critical steps toward achieving a goal or completing a project.

Retain Top Talent

Strategies and practices employed by organizations to keep highly skilled and valuable employees from leaving the company.

Division Of Labour

Refers to the process of dividing work into specialized tasks or roles intended to improve efficiency and productivity in the workplace.

Organizations

Structures or entities that are purposefully formed by individuals to achieve common goals, encompassing businesses, nonprofits, and governmental bodies.