Early in Year 1, XYZ Company begins construction of an office building. The contract price for the construction is $23,400,000. The project, which is completed in Year 3, incurs costs as follows:
Year 1: $5,200,000
Year 2: $6,500,000
Year 3: $3,900,000
If XYZ Company recognizes income under the completed contract method, how much income would they recognize on the office building contract in Year 3?

When using the indirect method to determine operating cash flows in a cash flow statement, which of the following would be deducted from net income?

XYZ Company owns machinery with a cost of $100,000 and an accumulated depreciation of $60,000 on January 1, 2007. On July 1, 2007, the machinery is sold for $43,000. The straight line depreciation method has been used during the previous six years of life. How much gain or loss will be recorded on the sale?

What occurs when the then-current book value of an asset exceeds the sum of expected undiscounted cash flow?

Which of the following statements about MACRS depreciation is NOT true?

In 2008, XYZ Company spends $250,000 on research and development to generate new product lines. Of the five projects in progress, one results in a patented item while the other four are considered unsuccessful. According to generally accepted accounting principles, how much of the $250,000 should be recognized as an expense in 2008?

XYZ Company reports its net assets at a book value of $150,000. Investigation reveals that the net assets had a market value of $175,000. In addition, XYZ Company had been offered $220,000 for the company by ABC Company. What is the amount of goodwill that should be recorded on the books of XYZ Company?

Which of the following depreciation methods would best match the cost with expected benefits when the rate of usage for an asset varies greatly from period to period?

When an asset impairment occurs, a company writes down the asset to _______________.

The situation in which a company uses its accounts receivable to obtain a loan is called ___________. In this process, the company usually maintains control of the receivables, collects from customers, and forwards the proceeds to the lending institution to liquidate the loan.

A manufacturing firm sells a parcel of land next to one of its warehouses. What type of activity is this?