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Q7(5)PSB

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Financial & Managerial Accounting
Found in: Page 160
Financial & Managerial Accounting

Financial & Managerial Accounting

Book edition 7th
Author(s) John J Wild, Ken W. Shaw, Barbara Chiappetta
Pages 1096 pages
ISBN 9781259726705

Short Answer

In the blank space beside each numbered balance sheet item, enter the letter of its balance sheet classification. If the item should not appear on the balance sheet, enter a Z in the blank.

A. Current assets E. Current liabilities

B. Long-term investments F. Long-term liabilities

C. Plant assets G. Equity

D. Intangible assets

5. Machinery

The correct answer is C, Plant assets.

See the step by step solution

Step by Step Solution

Definition of machinery

Machinery is an asset that helps in the organization's production process; it is a fixed asset and should be depreciated using an appropriate depreciation method.

Reason for choice

Machinery is an asset and provides benefits for a more extended period; hence it should be disclosed under the plant asset section of the balance sheet. The plant asset section records all the fixed assets of the organization.

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