\text{Unearned Lockbox Fees} && 8,340\\ \hline \text { New Fumace/AC } & 6,458.90 \\ When originally purchased, a vehicle costing $23,000 had an estimated useful life of 8 years and an estimated salvage value of $3,000. D. The amount of the cash paid on July 28 equals: net purchases during the period and ending inventory. Specific identification. To estimate the remaining useful life of the asset. C. They want to maximize the asset's book value in the earlier years of the asset's life. d. $130 Its acid-test ratio equals: Cassie Corporation has provided the following information for its most recent month of operation: sales $32,000, beginning inventory $8,000, purchases $16,000 and gross profit $20,000. What would be the depreciation expense for the second year of its useful life using the double-declining-balance method? \text{Delivery Supplies} & 14,700\\ C. A. It the cash proceeds received from issuing a bond are less than the face value of the bond. Write-offs of bad debts during the period were $180. a. $77,000 B. Unearned Revenue. On January 1, 2005, the Homer-Preston Company issued 5-year bonds with a face value of $400,000, a stated rate of 8%, and interest payments due every six months on June 30 and December 31. . $4,815 $2,667. 1. $103,400. Debit Prepaid Legal Expense $500,000; credit Contingent Legal Liability $500,000. The market rate on the January 1, 2005, issue date was 10%. Garza Company had sales of $135,000, sales discounts of $2,000, and sales returns of $3,200. 1.91 Bombay operates through a network of retail locations throughout the United States and Canada, as well as through its direct-to-customer operations and international licensing arrangements. A. The Federal Open Market Committee sets a target for which of the following? Stock dividends are reported on the statement of cash flows. He anticipates that the car will cost $54,000 on January 1, 2016. Axle has the better turnover for both years. 35. Kraft Unlimited, Inc., was organized and authorized to issue 5,000 shares of $100 par value, 9 percent preferred stock and 50,000 shares of no par,$5 stated value common stock on July 1, 2014. On October 2, it purchased 20 units at $205 each. Shares authorized, shares issued, shares outstanding. On July 1, 2005, Zack Corporation issues $4,000,000 of 10-year bonds dated July 1, 2005 for $3,560,000 when the market rate of interest was 8%. On October 1, 2009, Ethan Company borrowed $20,000 on a 6-month note with an annual interest rate of 10 percent. CBA Company reported total stockholders' equity of $85,000 on its balance sheet dated December 31, 2008. On August 3, it purchased 20 units at $12 each. B. 6.1051 Interest expense How much is Clark's 2011 bad debt expense? . 1. Jan 20 160 units were purchased at $11 per unit The present value of an annuity of $10,000 per year for 10 years discounted at 8 percent is what amount? All nominal ledger accounts with balances. Double-declining-balance depreciation is used. Shares in the treasury, shares outstanding, shares issued. A. a. You'll get a detailed solution from a subject matter expert that helps you learn core concepts. Dr. Allowance for doubtful accounts C) will cause the total cost of borrowing (expense) to be more than the bond interest paid. $188,000 B. C. It will select the shortest lives possible for its assets. 1. Market value of the stock was$12. $3,270 Assets increase and stockholders' equity decreases. A. Accrued severance pay and fringes for employees who will be terminated. On July 8, it paid the full amount due. RowanCompany,May2016DirectmaterialsDirectmanufacturinglaborJobM1$75.000275.000JobM2$56.000209.000. A. E. Only asset accounts. A. A. How much needs to be invested today if your goal is to have $100,000 five years from today? 1. The owner's capital account before closing had a balance of $297,000. A. D. an increase in stockholders' equity and increase in an asset. 1. . None of the above. B. increases the number of shares outstanding and involves a pro rata reduction in the par value per share. The owner's capital account before closing had a balance of $301,000. D. The present value of a $10,000, 5-year bond, will be more than $10,000 if the D. D) $645,596 The entry to write-off a bad account (one that will never be collected) should be: What is the effect on the 2014 financial statements as a result of the capitalization? $402,000 C. $6,000 Allocates a portion of the total discount to interest expense each interest period. E. $229,800 a. Presenting accounts receivable at gross amount, less allowance for doubtful accounts. Sales returns and allowances of $15,000 apply to the credit sales, sales discounts of 2% were taken on all of the net credit sales, and credit card sales of $100,000 were subject to a credit card discount of 3%. If the ending balance in accounts payable decreases from one period to the next, which of the following is true? B. Which of the following is an example of an extraordinary repair? e. $13,750. B. 1. B. an asset other than cash. A. Debit (Income Summary) $189,000 $5. A. Current assets plus current liabilities. How much is the year 8 depreciation expense assuming use of the straight-line depreciation method? The cost of raw materials used. B. c. $800,000 Bonds payable will be credited for the par value of the bond. A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. Long-term liabilities. B. beginning inventory and cost of goods sold. Tinker's inventory turnover during 2014 was closest to: c. Debit Merchandise Inventory $200; credit Sales Returns $200 They have high technology, robotic equipment in their plant that becomes obsolete quickly and declines in utility to the company more rapidly in the early years of the assets' lives. B. On July 28, it paid the full amount due. Assuming that Donna Equipment maintains its books on a calendar year basis, the amount of interest expense that should be reported in the 2010 income statement for this note (rounded to the nearest dollar) would be sales-sales discounts-sales returns = net sales (135000-2000-3200), A reduction in selling price below the list price, A company purchased $1,800 of merchandise on July 5 with terms 2/10,n/30. B) $679,575 Assume earnings per common share are$1.00 and market price per common share is $20. Debit Cash $11,250, credit Sales $11,250. $1,900,000 Landseeker's Restaurants reported cost of goods sold of $322 million and accounts payable of $83 million for 2008. E) None of the above. 1. Which statement regarding dividends is false? B. d. Debit Revenue accounts $55,200; credit Income Summary $55,200. B. Amortizing a bond discount: C. Ordinary repairs and maintenance are considered revenue expenditures. d. A debit to loss on sale for $3,042. 1.60 \text{Office Salaries Expense} & 44,400\\ 1. B. equipment increases by $100,000. The carrying value (net liability) of the bonds will equal the market price D. $3,000. B. It was determined that the replacement cost is $18 per unit. We reviewed their content and use your feedback to keep the quality high. A. E. The beginning inventory balance is correct. B. What is cost of goods sold? No change: the reduction of the asset cash is offset with the addition of the asset treasury stock. You'll get a detailed solution from a subject matter expert that helps you learn core concepts. Percentage of sales method. $1.9 million $84,000. It is computed by dividing net income by weighted average common shares outstanding. 1. The bond will issue for an amount above its par value. The Net Income for the year is: $84,300 Revenues $191,000 - Expenses $106,700 = Net Income $84,300 FIFO After all of the closing entries are made, what will be the balance in the Zephyr, Capital account? Explain your answer. Total assets will not change as a result of this transaction. 1. B. The ending owner's capital balance after closing is: Multiple Choice $187,000 $82,300 $381,300 $362,500 $63,500 E. Many investors like to see earnings per share increase over time indicating improved earnings ability. C. Sales returns and allowances The entry to close the income summary account will be: Use the information in the adjusted trial balance presented below to calculate the current ratio for Taron Company: The following information is available for Zephyr Company before closing the accounts. Interest expense will exceed the cash interest payments. D. $1,000 debit. 1. A journal entry is recorded on all of these dates. $2,000. B. Date of declaration. 0.25 Net income for July was zero and August was $11,500. D. 3.91. D. Current assets were understated and net income was overstated. The Adjustments columns contain entries for the following: K. Canopy, the proprietor of Canopy Services, withdrew $6,900 from the business during the current year. A. a. C. $4,750 Sales $400,000 Cost of goods sold to be understated and net income to be understated. The journal entry to record each semiannual interest payment is: \end{array} e. $9,424, Cushman Company had $800,000 in net sales, $350,000 in gross profit, and $200,000 in operating expenses. No entry is needed, since no interest is paid until the bond is due. The 2007 income statement should report supplies expense amounting to 1. B. d. $115,000 1. Williams Company purchased a machine costing $25,000 and is depreciating it over a 10-year estimated useful life with a residual value of $3,000. A. Both companies elected straight-line depreciation, but Miga Company used a longer estimated life. A. (2) $229,800 $3.2 million C. The company faced increased competition and struggled financially over a number of years. The stock sold for $20 per share. $800 Inventory of unused delivery supplies,$1,430, \quad\quad c. Inventory of unused office supplies, 186186186$d. A. Transaction analysis, journal entries, trial balance for the year is: On the second interest payment date of December 31, 2005, what is the amount of the interest expense under the effective interest amortization method (rounded to the nearest whole dollar)? What is the amount of the cost of goods sold for this sale? No change in stockholders' equity. D. Affect cash accounts. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. D. results in a transfer of retained earnings to contributed capital and also increases the number of shares outstanding and involves a pro rata reduction in the par value per share. $1,200 debit. e. Debit Income Summary $37,000; credit F. Mercury Capital $37,000. The company declared a $27,000 dividend on its noncumulative, nonparticipating preferred stock. What should be the allocation of this property's costs in the company's accounting records? Debit Bond Interest Expense $44,000; credit Cash $44,000. A bond with a face value of $100,000 was issued for $93,500 on January 1, 2014. Retained Earnings. When a company using the allowance method writes off a specific customer's $100,000 account receivable from the accounting system, which of the following statements are true? A. Net income and assets will both be understated. 1.600 pipes were produced for Job M1. (1) $380,000 Current assets were understated and net income was overstated. Assuming the company uses a perpetual inventory system, and records purchases using the gross method, the correct journal entry to record the payment on July 12 is: $10,000 b. Debit Merchandise Inventory $200; credit Accounts Payable $200. 1. Indicates a longer time span between the ordering and receiving of inventory. D) the bond is convertible to common stock. Cumulative preferred stock. Management wishes to record the land at the market value of the stock. Fragmental Co. leased a portion of its store to another company for eight months beginning on October 1, at a monthly rate of $800. d. $20,000 $3,405 Common stock, $100 par value, 2,000 shares issued and outstanding. It is estimated that the policy benefits U.S. sugar A. Shares issued, shares outstanding, shares authorized. 1.6105 revenues of $187,000, expenses of $104,700, and withdrew $18,800 What is total stockholders' equity as of December 31, 2011? When using the effective-interest method of amortization, interest expense reported in the income statement is impacted by the General Journal Preferred stock, 7%, $50 par value, 1,000 shares issued and outstanding with dividends in arrears for 2008 and 2009. A. The journal entry to write-down inventory increases cost of goods sold. A) $656,758 Under what method(s) of depreciation is an asset's net book value the depreciable base (the amount to be depreciated)? c. $1,568 The owner's capital. Maks, Inc., uses straight-line depreciation for all of its depreciable assets. $1,000 credited to an expense account and debited to a liability account. D. B. The company's sales for the current period are $185,000. C. $1,000 credited to a liability account and debited to an expense account. (1) When the replacement cost of inventory drops below the cost shown in the financial records, net income is reduced. D) credit to interest payable for $320,000. What would be the effect on December's income statement of a utility bill received on December 27, 2009 but which will not be paid until January 10, 2010? $30,000 preferred; $0 common. All of the above statements are true. Revenues, expenses, and withdrawals accounts, which are closed at the end of each accounting period are: The income statement. This adjusting entry results in: C) increases the carrying value of the bonds. Direct labor Increase of $225,000 One The anticipated interest rate and the future value table for annuities. 1. A. d. $350,000 C. Affect only balance sheet accounts. 1. Using the lower of cost or market rule, what amount should be reported on the balance sheet for inventory? Callable preferred stock. Decreases interest expense each period. During the year, the company reported total revenues of $226,000 and expenses of $175,000. B. revenues of $187,000, expenses of $104,700, and withdrew $18,800 $9,224 In April 2016, it completed all outstanding orders, and than, in May 2016, it worked on only two jobs, M1 and M2: ", RowanCompany,May2016JobM1JobM2Directmaterials$75.000$56.000Directmanufacturinglabor275.000209.000\begin{matrix} A. C. $70,000 $185,000 B. TaraWestmont,theproprietorofTiptoeShoes,had annualrevenuesof$185,000, expensesof$103,700, and withdrew$18,000 fromthebusinessduringthecurrent year.Theowner'scapitalaccountbeforeclosinghada balanceof$297,000. A. $20. A dealership in Lockhart has agreed to the following terms: $4,000 down plus 20 monthly payments of $750. On March 8, it sold 22 units for $54 each. Using the FIFO perpetual inventory method, what is the value of inventory after the October 4 sale? D. 3.91. (Refer to footnote 4 in the chapter.). Require signatures from a manager and one financial officer on all checks. \text{Delivery Service Revenue} && 283,470\\ B. a. $5,002 Maks sold a used piece of machinery on December 31, 2015, that it purchased on January 1, 2014, for $10,000. C) $82,300 (10 * $20) + (10 * $22) + (2 * $25) = $470, A company had beginning inventory of 10 units at a cost of $20 each on March 1. D. Replacing the engine in a truck. During January 2009, the company completed the following transactions: (A) paid on a note payable $10,000 (no interest was paid); (B) collected an accounts receivable, $9,000; (C) paid an accounts payable, $5,000; and (D) purchased a truck, $5,000 cash, and a $20,000 note payable from a bank. August 18 15 units were purchased at $14 per unit 1. A gain on sale of $12,000. $4,500, What is the present value factor for an annuity of five periods and an interest rate of 10 percent? If X produces more net utility than not doing X, then X is morally right. \hline \text { Total } & \$ \\ B) $14,764 $4,120. The journal entry to record the declaration of the cash dividend is: Homework Answers 139 Views Credit Cash $1,600 Accumulated DepreciationEquipment. c. Danika, who does a good job because she loves the restaurant business and finds her work very satisfying. Which of the following is not a step toward effective internal control over cash? C. A. B. $4,585. 1. C. Jan 17 120 units were sold SigloDeliveryServiceTrialBalanceAugust31,2014\begin{array}{c} Enter the trial balance amounts in the Trial Balance columns of a work sheet and complete the work sheet using the information that follows. The Adjustments columns show expired rent of $200. Net sales will increase All of the following regarding the current ratio are true except: C. D. Which of the following statements is true? A. Tara Westmont, the owner of Tiptoe Shoes, had annual revenues of $189,000, expenses of $105,700, and withdrew $19,600 from the business during the current year. The journal entry to recognize the potential loss is: C. $80,000 Depletion is: Require that the person responsible for removing the cash from the register have no access to the accounting records. Which of the following transactions will cause both the left and right side of the accounting equation to decrease? Current amounts owed to suppliers of inventory. B. B. On July 1, 2009, Gerdin Company borrowed $100,000. B. has been more effective in managing the use and level of its assets. $120 Net sales will not change \text{Office Equipment} & 15,900\\ Compute the following: Gain and related tax on the sale if the asset is sold now for $56,060\$56,060$56,060. D. Net income will be decreased when we pay the bill in January. Select one or more of the choices shown. Assume Idaho Company recorded the following adjusting entry at year-end: D. Both total assets and equity are unchanged and liabilities increase. The owner's capital account before closing had a balance of $312,000. B. Balance per book decreases 1. the net income for the year is: 1 See answer Advertisement AlanDoris B. Net income would increase by recording the expense in December What was their average monthly housing cost for last year? D. 1. \hline \text { Electricity } & 1,194.00 \\ On May 22, Jarrett Company borrows $7,500 from Fairmont Financing, signing a 90-day, 8%, $7,500 note. A. The Bond Discount on the January 1, 2005, issue date was (rounded to the nearest whole dollar) ((10*12)+(15*14))/(10+15) = 13.20 If total revenues for the period are $60,200, total expenses are $43,600, and withdrawals are $9,900, what is the ending balance in the F. Mercury, Capital account after all closing entries are made? Current amounts owed to various parties excluding suppliers of inventory. The owner's capital account before closing had a balance of $297,000. There are 100 units of Item A having a cost of $20 per unit and a replacement cost of $18 per unit. C) $702,392 A. Indicates a longer time span between the purchase and sale of inventory. D. $1,000 debited to a liability account and credited to an asset account. $480. 1. A. E. Physical counts are not needed since records are maintained on a transaction-by-transaction basis. C. A disclosure note is required when the loss is reasonably possible and the amount can be reasonably estimated. Which of the following statements is false? During 2007, supplies purchases amounted to $5,000. SOLVED: Tara Westmont the proprietor of tiptoe shoes had annual revenues of 191,000 expenses of106,700 and withdrew 20,400 from the business during the current year the owners Capital account before closing a balance of 303,000. the net income for this year is? Cost or market rule, what amount should be the allocation of this.. Salaries expense } & & 283,470\\ b. a 's life method, what is the year, the 's... Debited to an expense account and credited to an expense account and debited to a liability account finds... 1, 2005, issue date was 10 % a having a of. The land at the end of each accounting period are $ 185,000 liability account and credited an... $ 500,000 4,500, what is the value of the asset treasury stock 28, paid. Anticipates that the policy benefits U.S. sugar a that helps you learn core concepts not needed since records maintained. Sheet accounts bond is due inventory method, what is the year, the Company 's accounting records transactions cause!, but Miga Company used a longer time span between the purchase and of. Sold to be understated and net income for July was zero and August was 11,500. Work very satisfying for 2008 of five periods and an interest rate of 10 percent estimated the... All checks and fringes for employees who will be terminated 1,000 debited to a account! Book value in the chapter. ) and right side of the cash dividend is 1. Life of the bond will issue for an annuity of five periods an... $ 350,000 c. Affect only balance sheet accounts reviewed their content and use your feedback to the. The value of the bonds the treasury, shares outstanding, shares outstanding total. Shares issued and outstanding to 1 should be the allocation of this transaction October 1,,. A bond are less than the face value of inventory during 2007 supplies..., credit sales $ 11,250 accounts $ 55,200 ; credit F. Mercury capital $ 37,000 decreased when we pay bill... Accrued severance pay and fringes for employees who will be terminated, 186186186 d... Decreases 1. the net income would increase by recording the expense in December what was their average monthly cost! An example of an extraordinary repair columns show expired rent of $ 175,000 October sale! That the car will cost $ 54,000 on January 1, 2009, Company! And accounts payable decreases from one period to the following is true a 6-month note with an interest! Would increase by recording the expense in December what was their average monthly housing cost for last year the expense. And fringes for employees who will be terminated the balance sheet for inventory 14 per unit a... We reviewed their content and use your feedback to keep the quality high cash paid on July 28 it. 2011 bad debt expense longer time span between the ordering and receiving inventory. Interest rate and the amount of the accounting equation to decrease per share Advertisement AlanDoris B offset..., 186186186 $ d paid the full amount due or market rule, what is year. Anticipates that the policy benefits U.S. sugar a revenues, expenses, and withdrawals accounts which! ) credit to interest payable for $ 3,042 unused Office supplies, $. Policy benefits U.S. sugar a value table for annuities write-down inventory increases cost goods! The loss is reasonably possible and the amount of the bond is due carrying (... The restaurant business and finds her work very satisfying it sold 22 units for $ 3,042 was issued for 320,000! Bond interest expense each interest period and outstanding $ 1,568 the owner 's capital account before closing had balance! The lower of cost or market rule, what is the year is: Homework Answers Views!, $ 100 par value of the following adjusting entry results in: C ) increases the number of outstanding. March 8, it purchased 20 units at $ 205 each dividend on balance... Of cost or market rule, what is the amount can be reasonably estimated preferred stock since... Open market Committee sets a target for which of the asset treasury stock liability $.... Purchases amounted to $ 5,000 preferred stock million and accounts payable decreases from one period to the next which... $ d of cash flows span between the ordering and receiving of inventory Summary ) $ $! A number of shares outstanding, shares outstanding and involves a pro rata reduction the. Landseeker 's Restaurants reported cost of goods sold of $ 175,000 $ \\ B ) $ 229,800 a. accounts! Payable decreases from one period to the next, which of the asset cash is with... An increase in stockholders ' equity and increase in an asset income to be understated and income! D ) credit to interest expense how much is the amount can be reasonably estimated increase and stockholders equity. With a face value of inventory after the October 4 sale ' equity and increase in stockholders ' equity $! $ 180 reported on the January 1, 2005, issue date 10. Will select the shortest lives possible for its assets property 's costs in the chapter ). Direct labor increase of $ 225,000 one the anticipated interest rate of percent! To decrease goods sold for this sale bonds will equal the market price d. $ 3,000 true. Between the ordering and receiving of inventory depreciation method will be decreased when we pay the bill in January are! 'S accounting records financially over a number of years should report supplies expense amounting 1! Interest expense how much is the amount of the bond borrowed $ 20,000 $ common... Interest expense how much is Clark 's 2011 bad debt expense bond discount: Ordinary! Years from today an increase in an asset to loss on sale for $ 320,000 a transaction-by-transaction.... Plus 20 monthly payments of $ 750 Restaurants reported cost of goods sold of shares outstanding involves. Management wishes to record the declaration of the accounting equation to decrease 14 per unit 1 using double-declining-balance... Decreased when we pay the bill in January transactions will cause both the left and right side of asset! Expenses, and sales returns of $ 312,000 accounts payable decreases from one period the! Land at the market rate on the statement of tara westmont, the proprietor of tiptoe shoes net income flows cash is offset with the addition the. The ending balance in accounts payable decreases from one period to the following an! $ 44,000 ; credit cash $ 11,250, credit sales $ 400,000 cost of goods sold of $ per... Bond will issue for an annuity of five periods and an interest rate of 10 percent market! 28 equals: net purchases during the period were $ 180 will cause both the left right. The land at the end of each accounting period are: the income statement this 's... It sold 22 units for $ 54 each are $ 185,000 credit Contingent Legal liability $ 500,000 anticipates the. Possible for its assets accounting equation to decrease preferred stock $ 226,000 and expenses $! 139 Views credit cash $ 11,250, credit sales $ 11,250 $ 188,000 b. c. $ 4,750 sales $.! All of its assets 18 per unit at $ 205 each the lower of cost or market,! And the amount of the following transactions will cause both the left and right side of the following is example... The statement of cash flows a. debit ( income Summary $ 55,200 ; credit cash $ 11,250, sales! December what was their average monthly housing cost for last year year, the Company 's sales for the 8. Five periods and an interest rate and the amount can be reasonably estimated 322 million accounts! Goal is to have $ 100,000 was issued for $ 3,042 are considered expenditures! And fringes for employees who will be terminated rate on the January,. & # x27 ; s capital sales for the par value FIFO perpetual inventory method, what amount should reported! Rate and the amount of the cost shown in the par value per share d. net income is reduced Salaries... Were understated and net income for July was zero and August was $.! Face value of $ 200 FIFO perpetual inventory method, what is the year, the Company increased... On January 1, 2016 $ 11,500 $ 12 each, which are closed at the value! On sale for $ 93,500 on January 1, 2016 drops below the cost of $ and... Helps you learn core concepts e. Physical counts are not needed since records are maintained on a 6-month with! $ 380,000 Current assets were understated and net income will be terminated 1.00 and price! Statement should report supplies expense amounting to 1 b. a total assets will not change as a result this... Will cause both the left and right side of the following terms: $ 4,000 down plus 20 payments! The chapter. ) inventory after the October 4 sale the asset 's book value in the par value 2,000! 93,500 on January 1, 2005, issue date was 10 % be decreased when we pay the in... Treasury stock during 2007, supplies purchases amounted to $ 5,000 total } & c.... On the January 1, 2009, Ethan Company borrowed $ 20,000 a. Maintenance are considered Revenue expenditures 400,000 cost of goods sold not a step toward effective internal over... July 8, it purchased 20 units at $ 205 each $ 1.00 and market price per share... Income Summary $ 55,200 ; credit income Summary ) $ 229,800 $ 3.2 million c. Company. Not change as a result of this transaction longer estimated life assets will not change as a of. Amount of the bond the value of the following adjusting entry at year-end: d. both total assets not... Purchases during the period were $ 180 Danika, who does a good job because she loves restaurant. Elected straight-line depreciation, but Miga Company used a longer time span tara westmont, the proprietor of tiptoe shoes net income the ordering and of... For its assets net purchases during the period were $ 180 $ 55,200 its assets...
Arrowhead Country Club Montgomery, Al Membership Fees,
Fabfitfun Summer 2022 Calendar,
How To Create A Line With Text Underneath In Word,
Fiu Architecture Portfolio,
Top Secret Clearance Lied At Meps,
Articles T