tailieunhanh - Lecture Financial accounting (9th Edition): Chapter 9 - Weygandt, Kieso, Kimmel

Chapter 9 - Plant assets, natural resources, and intangible assets. The following will be discussed in this chapter: Explain the cost principle for computing the cost of plant assets; explain depreciation for partial years and changes in estimates; distinguish between revenue and capital expenditures, and account for them. | Preview of Chapter 1 Financial Accounting Ninth Edition Weygandt Kimmel Kieso Preview of Chapter 9 Financial Accounting Ninth Edition Weygandt Kimmel Kieso 9 Plant Assets, Natural Resources, and Intangible Assets Learning Objectives After studying this chapter, you should be able to: [1] Describe how the historical cost principle applies to plant assets. [2] Explain the concept of depreciation and how to compute it. [3] Distinguish between revenue and capital expenditures, and explain the entries for each. [4] Explain how to account for the disposal of a plant asset. [5] Compute periodic depletion of natural resources. [6] Explain the basic issues related to accounting for intangible assets. [7] Indicate how plant assets, natural resources, and intangible assets are reported. Plant assets are resources that have physical substance (a definite size and shape), are used in the operations of a business, are not intended for sale to customers, are expected to be of use to the company for a number of years. Referred to as property, plant, and equipment; plant and equipment; and fixed assets. Plant Assets LO 1 Plant assets are critical to a company’s success Illustration 9-1 Plant Assets LO 1 Historical Cost Principle requires that companies record plant assets at cost. Cost consists of all expenditures necessary to acquire an asset and make it ready for its intended use. Determining the Cost of Plant Assets Plant Assets LO 1 All necessary costs incurred in making the land ready for its intended use increase (debit) the Land account. Costs typically include: cash purchase price, closing costs such as title and attorney’s fees, real estate brokers’ commissions, and accrued property taxes and other liens on the land assumed by the purchaser. Determining the Cost of Plant Assets Land LO 1 Illustration: Hayes Company acquires real estate at a cash cost of $100,000. The property contains an old warehouse that is razed at a net cost of $6,000 ($7,500 in costs less $1,500 . | Preview of Chapter 1 Financial Accounting Ninth Edition Weygandt Kimmel Kieso Preview of Chapter 9 Financial Accounting Ninth Edition Weygandt Kimmel Kieso 9 Plant Assets, Natural Resources, and Intangible Assets Learning Objectives After studying this chapter, you should be able to: [1] Describe how the historical cost principle applies to plant assets. [2] Explain the concept of depreciation and how to compute it. [3] Distinguish between revenue and capital expenditures, and explain the entries for each. [4] Explain how to account for the disposal of a plant asset. [5] Compute periodic depletion of natural resources. [6] Explain the basic issues related to accounting for intangible assets. [7] Indicate how plant assets, natural resources, and intangible assets are reported. Plant assets are resources that have physical substance (a definite size and shape), are used in the operations of a business, are not intended for sale to customers, are expected to be of use to the company for