The Following Information Is Given for Building Inc During 2005 New Assets Were Purchased for of $78,000, and |

question 57

Multiple Choice

The following information is given for Building Inc.:
$$\begin{array} { | l | c | c | } \hline \text { As of } 12 / 31 & 2005 &{ 2004 } \\\hline \text { PP\&E } & \$ 570,000 & \$ 530,000 \\\hline \text { Accumulated Depreciation } & \$ 102,000 & \$ 92,000 \\\hline \text { Depreciation Expense } & \$ 30,000 & \$ 32,000 \\\hline\end{array}$$ During 2005 new assets were purchased for of $78,000, and plant assets were sold at a $10,000 loss.
-Beginning and ending prepaid insurance is, respectively, $36,000 and $26,500. During the period, $30,500 of insurance expense was recorded. How much new insurance was purchased?

• A) $2,500
• B) $15,600
• C) $49,000
• D) $21,000

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Definitions:

Departments

Divisions within an organization, each responsible for specific functions or tasks, contributing to the organization's overall objectives.

Customizing Department

A specialized unit within a company that modifies products to meet specific customer requirements or preferences.

Departmental Predetermined Overhead Rates

Overhead rates calculated for each department based on estimated costs and activity levels, used to allocate overhead costs to products.

Machine-Hours

Machine-Hours are a measure of the actual running time that a machine or group of machines operates during a given period.