B. its assets decreased during an accounting period. What was their average monthly housing cost for last year? The ending owner's capital balance after closing is: d. Debit Revenue accounts $55,200; credit Income Summary $55,200. Amortization C. It is used instead of reducing accounts receivable directly. D. $2,667. The owner's capital account before closing had a balance of $303,000. C. a decrease in stockholders' equity and an increase in liabilities. D. Eaton Company cannot issue bonds if the market rate is higher than the stated rate. $$ A. During the month of May, total credits to Accounts Receivable were $52,000 from customer payments. $227,000 Debit Bond Interest Expense $550,000; credit Cash $550,000. The F. Mercury, Capital account has a credit balance of $18,700 before closing entries are made. The adjusted cash balance per the books on January 31 is: d. $10,300 C. Added to the bank balance of cash. Gross sales total $300,000, one-half of which were credit sales. The correct journal entry to record the merchandise return on August 11 is: The owner's capital account before closing had a balance of $297,000. d. $570 Assets are understated and net income is overstated. B. A. The bonds were sold at a discount. Tara Westmont, the stockholder of Tiptoe Shoes, Inc., had annual revenues of $189,000, expenses of $105,700, and the company paid $19,600 cash in dividends to the owner (sole stockholder).. 1. Recognizes that a customer returned merchandise and/or received an allowance. The entry to close the withdrawals account at the end of the year is: Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $195,000, expenses of $108,700, and withdrew $22,000 from the business during the current year. Rate answer . Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $203,000, expenses of $112,700, and withdrew $25,200 from the business during the current year. B. B. B) at the end of the year. $53,349 A. \text{Accounts Receivable} & 29,314\\ As of March 1, outstanding checks total $22,000 and deposits in transit total $15,000. Number of hours of television watching per day for people with 12 years of education. 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. The allowance for doubtful accounts balance on January 1, 2011 was $15,000. $113,000 A. Miga Company estimated a lower residual value, but both estimated the same useful life and both elected straight-line depreciation. Debit Retained Earnings $250,000; credit Common Stock $250,000. C. e. $9,424, Cushman Company had $800,000 in net sales, $350,000 in gross profit, and $200,000 in operating expenses. The owner's capital account before closing had a balance of $314,000. $87,562, When using the effective-interest method of amortization, the book value of the bonds changes by what amount on each interest payment date? a. Debit Merchandise Inventory $1,600; credit Cash $1,600. Recording revenue in December 2009 for units manufactured but not yet sold to customers C. At the end of its accounting period, December 31, 2009, August Corporation owed $1,000 for property taxes for the current year, which had not been recorded or paid. D. 220, 1. LIFO A few hundred U.S. sugar makers lobby the U.S. government each year to make sure that the government taxes imported sugar at a high rate. 1. A. What was Landseeker's accounts payable turnover ratio in 2008? $450,000 How much is Clark's 2011 bad debt expense? Credit. \text{Accumulated DepreciationOffice Equipment} && 10,800\\ 1. At the beginning of the eighth year, a major overhaul on it was completed at a cost of $8,000, and the total estimated useful life was changed to 12 years with the residual value unchanged. The bonds were sold at a premium. B. $9,350. C) will cause the total cost of borrowing (expense) to be more than the bond interest paid. $4,055 The sale of bonds above face value The company's January 31, 2009 financial position is C. d. A debit to loss on sale for $3,042. 120. August 18 15 units were purchased at $14 per unit D) $645,596 Prepare the journal entry transferring Job M1 to finished goods. Which account would not be included in the debt-to-equity ratio calculation? Cannot be determined from the information given. The entry to record the first semiannual interest payment on December 31, 2005 will include a A. c. Land $82,750; Land Improvements, $33,100; Building, $49,650. Stock dividends decrease total equity. A. results in a transfer of retained earnings to contributed capital. D. $1,000 debit. When a credit sale is made with terms of 2/10, n/30 on May 10 and the customer's check is received on May 19, which of the following is true about the May 19 journal entry? If a company records sales revenue, Management wishes to record the land at the market value of the stock. If the beginning balance in prepaid insurance was $500 and $2,500 was paid for an insurance premium during the year, the ending balance in the prepaid insurance account (after the above adjusting entry) would be On January 1, 2014, Wasson Company purchased a delivery vehicle costing $40,000. $395,000 $ 1,547. Show transcribed image text Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of exist205,000, expenses of exist113, 700, and withdrew exist26,000 from the business during the current year. D) the bond is convertible to common stock. Unearned Revenue. $ 5,200. The amount of the cash paid on July 8 equals. A. c. The collective-action problem. B. The system of preparing financial statements based on recognizing revenues when the cash is received and reporting expenses when the cash is paid is called: Presenting accounts receivable less bad debt expense and write-offs. What would be the depreciation expense for the second year of its useful life using the double-declining-balance method? The owner's capital account before closing had a balance of $297,000. Both companies elected straight-line depreciation, but Miga Company used a longer estimated life. Net income is $18,320. The current period's entry to record the warranty expense is: Total liabilities increase and stockholders' equity decreases. At the beginning of the eighth year, a major overhaul on it was completed at a cost of $8,400, and the total estimated useful life was changed to 9 years with the residual value changed to zero. e. $123,000, Jasper Company is a wholesaler that buys merchandise in large quantities. Current amounts owed to suppliers of inventory. Written, recorded on the company books, sent to the payee, but not yet paid by the bank. On September 1, 2009, Donna Equipment signed a one-year, 8% interest-bearing note payable for $50,000. Par value of the bonds. D. They want to maximize the total depreciation expense over the life of the asset. Annual interest expense for a single bond issue continues to increase over the life of the bonds. The beginning balance in the allowance for doubtful accounts was $220. $2,920 D. Presenting accounting receivable at estimated net realizable value. B) stated rate of interest is greater than the market rate of interest. The machine is estimated to have a salvage value of $10,000 and an estimated useful life of 4 years. B. The stock sold for $20 per share. (Supplement) Irish Industries purchased a machine for $65,000 and is depreciating it with the straight-line method over a life of 10 years, using a residual value of $3,000. 1. Gross accounts receivable less the allowance for doubtful accounts in the asset section of the balance sheet. Payment of cash to a supplier for merchandise previously purchased on credit. 1. Which of the following statements is false about earnings per share? . A company has 4 million common shares authorized, 2.5 million shares issued and 100,000 treasury shares. What effect will these changes have on the company's net sales, all other things equal? Prepare an income statement, a statement of owners equity, and a balance sheet for the company. Siglo,Capital128,730R. Cash, short-term investments, and current receivables. The Net Income B) will cause the total cost of borrowing (expense) to be less than the bond interest paid. All of the above statements are true. Assets increase and stockholders' equity decreases. ending inventory and beginning inventory. B) $30,893 The F. Mercury, Capital account has a credit balance of $42,000 before closing entries are made. A. Also, owner withdrawals during the year totaled $48,000. C. $6,000 Which of the following activities does not violate the revenue recognition principle? the ending owner's capital balance after closing is: 2 See answers Advertisement MrsSeifried D. producers by about 111 billion dollars per year while costing U.S. Each job is unique. D. Current assets were understated and net income was overstated. Cash dividends paid to stockholders reduce net income. D. A. The owner's capital account before closing had a balance of $314,000. B. Net sales will increase Debit Merchandise Inventory $200; credit Accounts Payable $200. The net income for the year is: A. \text{Cash} & 10,072\\ B. 1. $680. D. Franchises, 1. Current assets were understated and net income was understated. 2003-2023 Chegg Inc. All rights reserved. Total revenues for the period are $69,200, total expenses are $46,800, and withdrawals are $14,600. D. B. Aug. 12 - Date of record for cash dividends. B) debit to interest expense for $284,800. What would be incorrect about reporting accounts receivable in the balance sheet? B. E. Written and not yet recorded in the company books. A bond with a face value of $100,000 was issued for $93,500 on January 1, 2014. 0.50. 1. 1. $500,000 A debit to loss on sale for $2,625. Which of the following is not a component of net sales? $350 D. What is the journal entry needed to record the transaction by Jarrett Company? (Assume all sales were made on the last day of the month.) July 1 - Issued 10,000 shares of common stock at $11 per share. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $201,000, expenses of $111,700, and withdrew $24. 1 and 2 \text{Annual Home Expenses}\\\begin{array}{|l|r|} 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. $94,000 D. debit Unearned Fees, $129; credit Fees Earned, $129. 1. C. All temporary ledger accounts with balances. On July 12, it paid the full amount due. Stock dividends increase total equity. Inventory of unused delivery supplies,$1,430, \quad\quad c. Inventory of unused office supplies, 186186186$d. $100,000 4.15 c. $5,750. D. What is cost of goods sold? Coupon rate of interest stated in the bond certificate. The owner withdrew $8,000 in cash during the same period. $0 preferred; $30,000 common. Gross accounts receivable less bad debt expense in the asset section of the balance sheet. The note and interest are due on December 31, 2009. B. C. $80,000 1. C. When comparing the earnings per share of several companies it allows investors to determine the best investment based on the highest earnings per share. The owner's capital. D. $50,000. The owner's capital account before closing had a balance of $307,000. Jan 17 120 units were sold 1. Which of the following describes the effect of the inventory error on the 2010 financial statements? A. Landseeker's Restaurants reported cost of goods sold of $322 million and accounts payable of $83 million for 2011. $520,000 B. Dividends represent a sharing of corporate profits with owners. D. Using the perpetual LIFO inventory costing method, what is the cost of the ending inventory? Debit Retained Earnings $750,000; credit Common Stock $750,000. Eastview company uses a perpetual LIFO inventory system, and has the following purchases and sales: The statement of retained earnings. In the second year, production increased to 19,000 units. Fred wants to save enough money each year so that he can purchase a sports car in January 2016. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $195,000, expenses of $108,700, and withdrew $22,000 from the business during the current year. B. 1. QV-TV, Inc. provided the following items in their footnotes for the year-end 2010: Cost of goods sold was $22 billion under FIFO costing and their inventory value under FIFO costing was $2.1 billion. Which of the following is not a component of the cost of inventory? B. How many of the following statements regarding goodwill are true? B. $4,725 By what amount does stockholders' equity increase? D. It is created as a result of the adjusting entry to record bad debt expense. 1. Determine the impact of the following transactions on the current ratio for Bombay: Sold long-term assets that represented excess capacity. Mayan Company had net income of $132,000. $544. C. net income to be understated and liabilities to be understated. 1. Debit Bond Interest Expense $44,000; credit Cash $44,000. Tara Westmont, the proprietor of Tiptoe Shoes, had annual Gilbert Company made an ordinary repair to a delivery truck during 2014 at a cost of $500 and capitalized the repair cost. E) None of the above is correct. E. B. A dealership in Leander will agree to a $1,000 down payment plus 20 monthly payments of $850. 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? Transaction analysis, journal entries, trial balance 1. B. On June 20, it returned $800 of that merchandise. The Bond Discount on the January 1, 2005, issue date was (rounded to the nearest whole dollar) a. Acquired new inventory; supplier was not willing to provide normal credit terms, so an 18-month interest-bearing note was signed. $6,000. B) $14,764 An increase in the expenses of the current period. The company has declared and paid a dividend of $1 per share. All of the above. $94,112 All of the above are advantages associated with bonds. A loss on sale of $3,000. During the year ended December 31, 2011, CBA reported net income of $10,000, declared and paid a cash dividend of $2,000, and issued additional common stock for $20,000. Rusty Corporation purchased a rust-inhibiting machine by paying $50,000 cash on the purchase date and agreeing to pay $10,000 every three months during the next two years; the first payment is due three months after the purchase date. E. What entry should be recorded on February 1 to record the write-off assuming the company uses the allowance method? The Net Income for the year is: A. c. Debit Accounts Payable $1,600; credit Merchandise Inventory $32; credit Cash $1,568. It is estimated that the machine could produce 75,000 bolts of woven fabric over its useful life. 1. It is possible, but not probable, that the company will have to pay a settlement of approximately $2,000,000. E. Debit Amortization Expense $24,000; credit Accumulated Amortization $24,000. D. $ 1,000. A dealership in Lockhart has agreed to the following terms: $4,000 down plus 20 monthly payments of $750. B. $ 333. The Leander offer is better because the cash down payment is less. C. $109,000. Copyrights C. Cumulative does not receive dividends but noncumulative does. Given this information, the correct gross profit would be: ending inventory overstated 20,000 means gross profit is overstated 20,000 B. $2,920 $12,000 preferred; $18,000 common. This dividend should be distributed as follows: $15,000 They are paid on Monday for the five-day workweek ending on the previous Friday. $2,000 Written, recorded, sent to payees, and received and paid by the bank. e. Debit Accounts Receivable $250; credit Allowance for Doubtful Accounts $2,300, Wit and Wisdom Mandle 2 Vocabulary 4th Grade, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Fundamentals of Financial Management, Concise Edition, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Daniel F Viele, David H Marshall, Wayne W McManus. a. Debit Bad Debts Expense $2,300; credit Accounts Receivable $2,300. A. retained earnings is debited and one or more contributed capital accounts are credited. Debit Lawsuit Payable $500,000, credit Contingent Legal Liability $500,000. A company wishes to report the highest earnings possible for financial reporting purposes. 1. Under what method(s) of depreciation is an asset's net book value the depreciable base (the amount to be depreciated)? The company's sales for the current period are $185,000. 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. The following is an example of an error that will not be discovered on the trial balance: C. 180 Which of the following direct effects on the accounting equation is not possible as a result of transactional analysis? 1. D. $3,000. $470 \text{Accumulated DepreciationTrucks} && 30,900\\ The retained earnings account before closing had a balance of $312,000. $20,000 Theendingowner'scapitalbalance afterclosingis: A)$63,300 B)$378,300 C)$81,300 D)$185,000 E)$360,300 37. \end{matrix} D. C. 10 percent discount for payment within 30 days D. c. $1,568 None. Uncollectible accounts receivable written-off during 2011 totaled $12,000. Dr. insurance expense 2,000 . A. 4.23 Debit Accounts Payable $1,800; credit Purchase Returns $200; credit Merchandise Inventory $1,600. E. A. \hline \text { Window Repairs } & 580.10 \\ A. A gain on sale of $12,000. for the year is: Option(C). 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} Assume a company's January 1, 2009, financial position was: Assets, $150,000 and Liabilities, $60,000. Cost of goods sold equals: None of the above. c. $171,000 prepaid insurance 2,000 Increases the market value of the Bonds Payable. 1. D. $14,500. A. Prepare adjusting, closing, and, when necessary, reversing entries from the work sheet. $7,000 Percent of accounts receivable method. If X produces more net utility than not doing X, then X is morally right. A. On December 1, Simpson Marketing Company received $3,600 from a customer for a marketing plan to be completed January 31 of the following year. The coupon rate of interest has increased since the bonds were sold. On January 1, 2007, the ledger of Global Corporation correctly showed supplies inventory of $1,000. C. Unearned Revenue. Clark has also provided the following information: 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. 1. On April 1, Griffith Publishing Company received $1,548 from Santa Fe, Inc. for 36-month subscriptions to several different magazines. For a business organized as a general partnership, which statement is true? D. an audit of financial statements helps investors and others to know that they can rely on the information presented in the financial statements. $1,900,000 Assume earnings per common share are$1.00 and market price per common share is $20. $4,500 Accrued but unpaid truck drivers wages at the end of the year, $1,920. B. increases the number of shares outstanding and involves a pro rata reduction in the par value per share. Net sales will increase. A. Debit Depletion Expense $25,800; credit Accumulated Depletion $25,800. B. The owner's capital account before closing had a balance of $297,000. Net income would increase by recording the expense in December c. Debit Revenue accounts $55,200; credit F. Mercury, Capital $37,000. Allocates a portion of the total discount to interest expense each interest period. = $83,300 $180 Transaction analysis, posting to the ledger, journal entries A. cash decreases by $50,000. a. Net income for the year and total assets would both be overstated. TaraWestmont,theproprietorofTiptoeShoes,had annualrevenuesof$185,000, expensesof$103,700, and withdrew$18,000 fromthebusinessduringthecurrent year.Theowner'scapitalaccountbeforeclosinghada balanceof$297,000. The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is: Multiple Choice Debit T . E. C. $2,200 debit. & \underline{\underline{625,836}} & \underline{\underline{625,836}}\\ 1. The cash paid on June 24 equals: How much interest does the company owe at the end of three months? ((10*12)+(15*14))/(10+15) = 13.20 The financial statements are not affected. The owner's capital account before closing had a balance of $297,000. D. A. C. Presenting accounts receivable at gross amount, less allowance for doubtful accounts. The owner's capital account before closing had a balance of $297,000. E. b. It is apparent that the stated interest rate on the bond was It is estimated that the policy benefits U.S. sugar If the machine is sold on December 31, Year 3 for $13,000, the journal entry to record the sale will include: C. $4.5 million d. Debit Accounts Payable $200; credit Merchandise Inventory $200 During the year ended December 31, 2009, it reported a net income of $10,000, declared and paid a cash dividend of $2,000, and issued additional capital stock of $20,000. All of the above are steps toward effective internal control. Aging of accounts receivable method. Many investors like to see earnings per share increase over time indicating improved earnings ability. Their records show that for last year, they paid$10,789.20 in mortgage payments, $581.00 for insurance premiums, and$2,685.00 in real estate taxes. On January 1, 2009, Tonika Corporation issued a four-year, $10,000, 7% bond. Outstanding checks at month-end Decrease of $75,000 C. $3,100 B. Yes, because the investor will receive more in cash dividends by owning more shares. D. $4,550. Shares in the treasury, shares outstanding, shares issued. c. $357 C. b. Total assets decrease and stockholders' equity increases. Which of the following statements does not accurately describe the lower of cost or market (LCM) valuation method? Cash payments to suppliers were less than current period purchases. On August 26, it paid the full amount due. No expense will be recognized until the bill is paid in January 1. Which of the following entries could not be a closing entry? $1,000 debited to an expense account and credited to an asset account. Shares outstanding, shares issued, shares authorized. Market rate of interest on the date the bonds were issued. D. 1. Decreases the Bonds Payable account. The anticipated interest rate and the present value table for annuities. The amount of the cash paid on July 28 equals: B. The Lockhart offer is better because the monthly payments are less. The journal entry to write-down inventory decreases gross profit. B. Current assets were overstated and net income was overstated. The understatement of the beginning inventory balance causes: Adjusting entries: A. ii D. A disclosure note is required when the loss is remote and the amount can be reasonably estimated. Date of declaration. A. \text{Building} & 196,000\\ D. The company will be unable to declare a 4/1 split because they do not have enough authorized shares to issue the needed 4.8 million shares. D. 1. The machine's useful life is estimated to be 5 years, or 300,000 units of product, with a $15,000 salvage value. D. an overstatement of net income, an understatement of liabilities, and an overstatement of stockholders' equity. e. Debit Accounts Payable $1,500; credit Purchase Returns $1,500. B. The entry to write-off a bad account (one that will never be collected) should be: Treasury stock has no voting, dividend, or liquidation rights. $5,002 D. 2015 C. $4,750 A. $520 $8,000 $87,707 What is the total amount of the dividend? $108,400. e. 1.41, a. Debit Unearned Revenue $11,250, credit Sales $11,250. 1. However, the ending inventory was overstated by $20,000. The company signed a note payable with interest at 6 percent per year. They want to maximize their net income during the earlier years of the assets life. A company issued 100,000 shares of common stock with a par value of $1 per share. Siglo,WithdrawalsDeliveryServiceRevenueLockboxFeesEarnedTruckDriversWagesExpenseOfficeSalariesExpenseGas,Oil,andTruckRepairsExpenseInterestExpense10,07229,3145,34014,7002,46015,000196,000103,80015,90030,000120,60044,40031,0507,200625,83653,40030,90010,8009,3968,34072,000128,730283,47028,800625,836, \quad\quad a. The owner's capital account before closing had a balance of $312,000. 1. CBA Company reported total stockholders' equity of $85,000 on its balance sheet dated December 31, 2008. An asset was purchased three years ago for $120,000\$120,000$120,000. C. $3,100 C. E) None of the above. Current assets. 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. 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. Sales $400,000 Juniper Company uses a perpetual inventory system and the gross method of accounting for purchases. B. E) $381,300. Was it within the 35% recommendation? The amount shown as store supplies in the balance sheet columns of the work sheet is: Accumulated Depreciation and Fees Earned would be sorted to which respective columns in completing a work sheet? 1. Current amounts owed to various parties excluding suppliers of inventory. The correct journal entry to record the merchandise return on July 7 is: $ 500. The effects of this transaction as reflected in the accounting equation are: A portion of the $100,000 plus interest in the Current Liability section and the remainder of the principal plus interest in the Long-Term Liability section. Landseeker's Restaurants reported cost of goods sold of $322 million and accounts payable of $83 million for 2008. Assume the owner, Raul Siglo, made no additional investments. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $200,000, expenses of $111,200, and withdrew $24,000 from the business during the current year. A. (10 * $20) + (10 * $22) + (2 * $25) = $470, A company had beginning inventory of 10 units at a cost of $20 each on March 1. B. C. 210 B. 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 fee of $3%. 1. On July 7, it returned $200 worth of merchandise. If a company mistakenly forgot to record depreciation on office equipment at the end of an accounting period, the financial statements prepared at that time would show: 1. A) equal to the market rate of interest. The owner's capital account before closing had a balance of $301,000. d. .52 1. (1800-200). B. $2,200 The adjusting entry for the year ended December 31 would include: 1. C. Affect both income statement and balance sheet accounts. A credit to gain on sale for $8,000. Affect only balance sheet accounts. The owner's capital account before closing had a balance of $313,000. The income statement. $18,000. On July 7, it returned $200 worth of merchandise. Failure to make a necessary adjusting entry for accrued interest on a note payable would cause 1. When the replacement cost of inventory drops below the cost shown in the financial records, net income is reduced. What is the difference between cumulative and noncumulative preferred stock? Zephyr, Capital $114,000 = $233,600

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