ACC 330 EXAM 1 QUESTIONS AND
ANSWER; LATEST UPDATED VERSION
2026; ALREADY GRADED A+
3 Types of intangible assets subject to cost recovery
through amortization - correct answer- 1.
organizational/start up costs
2. leasehold costs
3. business acquisition intangibles
4 Basic Methods of Periodic Cost Recovery - correct
answer- cost of goods sold, depreciation,
amortization, and depletion
- If none of those recovery methods are applicable then a
cost is recoverable only when the firm disposes of the
asset
A new partnership can deduct the lesser of its actual cost
or ________ - correct answer- $5000; this
,maximum is reduced $1 for $1 after total costs total
$50,000
- any non-deductible organizational cost must be
capitalized
- can elect to amortized such cost over 15 years (180
months) starting in the month business begins
A start-up firm can deduct the lesser of its actual cost or
______- - correct answer- $5000; this max is
reduced $1 for $1 after total costs exceed $50,000
- any non-deductible start up expenditures must be
capitalized
- can amortize over 180 months
Abatements - correct answer- temporary tax
exemptions on real property to lure commercial
enterprises into their jurisdictions for jobs, etc
, Ability to pay - correct answer- refers to the
degree of convenience with which a particular tax is levied
and collected
Accrual method of accounting - correct answer-
realization of expenses/revenues occurs when goods (or
services) are purchased/sold regardless of when
payments are made
Accrued Expenses for accrual basis firms - correct
answer- (GAAP) requires firms to identify liability for
an unpaid expense and accrue both the expense and the
liability on financial statements
TAX PURPOSES: tax law does not allow for the deduction
of expenses unless the accrual satisfies the all-events test
Activity based tax - correct answer- imposed on
the cumulative result of an ongoing activity
ex: income tax
ANSWER; LATEST UPDATED VERSION
2026; ALREADY GRADED A+
3 Types of intangible assets subject to cost recovery
through amortization - correct answer- 1.
organizational/start up costs
2. leasehold costs
3. business acquisition intangibles
4 Basic Methods of Periodic Cost Recovery - correct
answer- cost of goods sold, depreciation,
amortization, and depletion
- If none of those recovery methods are applicable then a
cost is recoverable only when the firm disposes of the
asset
A new partnership can deduct the lesser of its actual cost
or ________ - correct answer- $5000; this
,maximum is reduced $1 for $1 after total costs total
$50,000
- any non-deductible organizational cost must be
capitalized
- can elect to amortized such cost over 15 years (180
months) starting in the month business begins
A start-up firm can deduct the lesser of its actual cost or
______- - correct answer- $5000; this max is
reduced $1 for $1 after total costs exceed $50,000
- any non-deductible start up expenditures must be
capitalized
- can amortize over 180 months
Abatements - correct answer- temporary tax
exemptions on real property to lure commercial
enterprises into their jurisdictions for jobs, etc
, Ability to pay - correct answer- refers to the
degree of convenience with which a particular tax is levied
and collected
Accrual method of accounting - correct answer-
realization of expenses/revenues occurs when goods (or
services) are purchased/sold regardless of when
payments are made
Accrued Expenses for accrual basis firms - correct
answer- (GAAP) requires firms to identify liability for
an unpaid expense and accrue both the expense and the
liability on financial statements
TAX PURPOSES: tax law does not allow for the deduction
of expenses unless the accrual satisfies the all-events test
Activity based tax - correct answer- imposed on
the cumulative result of an ongoing activity
ex: income tax
