Practice Interest On Investment (4.3) - Construction Methods and Equipment Management

Practice: Interest on Investment

Lesson 4.3Construction Methods and Equipment Management

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9 questions

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6 sample questions

Question 1.
What are ownership costs?
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Consider costs that are fixed annually.
Question 2.
Name one method of calculating depreciation.
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It spreads the value loss evenly over time.
3Question 3.
What are the two main components of equipment costs?
- Ownership Costs and Operating Costs
- Fixed Costs and Variable Costs
- Direct Costs and Indirect Costs
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Think about costs associated with usage and ownership.
4Question 4.
True or False: Depreciation is only a physical cash flow.
- True
- False
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Consider how depreciation is recorded in financial statements.
Question 5.
Calculate the total depreciation after three years for equipment purchased at $90,000 with an expected salvage value of $15,000 over a useful life of 10 years using the straight-line method.
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Use the depreciation formula for annual depreciation.
Question 6.
If a piece of machinery's initial cost is $75,000, and using the sum-of-the-years' digits method, how much depreciation will be recorded in the first year if the expected life is 5 years?
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Remember to calculate the sum of the years for the digits method.

5 more questions in this section. Enroll free to practise them all.