(Solution) 14 An Oklahoma City Business Paid $15,000 Cash For Equipment Used In The Business. At The Time Of Purchase, The Equipment Had A List Price Of $20,000.... | Snapessays.com


(Solution) 14 An Oklahoma City business paid $15,000 cash for equipment used in the business. At the time of purchase, the equipment had a list price of $20,000....


14 An Oklahoma City business paid $15,000 cash for equipment used in the business. At the time of purchase, the equipment had a list price of $20,000. When the balance sheet was prepared, the value of the equipment later rose to $22,000. What is the relevant measure of the value of the equipment?

 

A. Historical cost, $15,000

 

B. Fair market cost, $20,000

 

C. Current market cost, $22,000

 

D. $15,000 on the day of purchase, $22,000 on balance sheet date

 

 

17 At the end of the current accounting period, account balances were as follows: Cash, $180,000; Accounts Receivable, $75,000; Common Stock, $20,000; Retained Earnings, $65,000. Liabilities for the period were:

 

A. $ 70,000. B. $170,000.

 

C. $190,000. D. $210,000.

 

 

19 If assets increase $210,000 during a given period and liabilities increase $65,000 during the same period, stockholders’ equity must:

 

A. increase $145,000. B. decrease $275,000.

 

C. decrease $145,000. D. increase $275,000.

 

 

20 Income taxes owed to the federal government would be classified as a(n):

 

A. expense on the income statement.

 

B. financing activity on the statement of cash flows.

 

C. current asset on the balance sheet.

 

D. current liability on the balance sheet.

 

 

21 The owner of a business paid cash from his personal checking account to purchase an automobile for his personal use. This transaction:

 

A. increased a liability account and increased liabilities.

 

B. decreased cash and increased expenses.

 

C. increased assets and increased owners’ equity.

 

D. is not a transaction recognized by the business.

 

 

22 Consider the following transactions:

 

I. Borrowed cash on a note payable, $80,000

 

II. Provided services on account, $10,000

 

III. Received cash from a customer as payment on account, $8,000

 

IV. Received a utility bill, $1,200

 

Total assets would be:

 

A. $96,800. B. $88,000.

 

C. $90,000. D. $98,000.

 

 

23 The purchase of land for cash would:

 

A. increase total assets.

 

B. decrease stockholders’ equity.

 

C. increase the total debits on the trial balance.

 

D. have no effect on total assets.

 

 

24 Performing services on account would:

 

A. decrease both assets and liabilities.

 

B. increase assets and decrease stockholders’ equity.

 

C. decrease revenue and decrease stockholders’ equity.

 

D. increase net income and stockholders’ equity.

 

 

 

25 Consider the following transactions:

 

I. Borrowed cash on a note payable, $80,000

 

II. Provided services on account, $10,000

 

III. Received cash from a customer as payment on account, $8,000

 

IV. Received a utility bill, $1,200

 

Total liabilities would be:

 

A. $1,200. B. $81,200.

 

C. $98,000. D. $80,000.

 

 

26 Consider the following transactions:

 

I. Owners invested $8,000 cash to begin the business

 

II. Provided services for cash, $6,000

 

III. Provided services on account, $4,000

 

IV. Paid cash for expenses, $7,500

 

How much cash does the business have?

 

A. $ 2,500 B. $ 4,500

 

C. $ 6,500 D. $10,500

 

 

27 Consider the following transactions:

 

I. Owners invested $8,000 cash to begin the business

 

II. Provided services for cash, $6,000

 

III. Provided services on account, $4,000

 

IV. Paid cash for expenses, $7,500

 

How much net income did the business have?

 

A. $2,500 B. $3,000

 

C. $4,000 D. $6,000

 

 

28 A trial balance prepared by an inexperienced accountant showed total debits of $540,000 and total credits of $450,000. This discrepancy is most likely due to which type of error?

 

A. Slide B. Transposition

 

C. Mislabeling D. Failure to post a transaction

 

 

29 An expense incurred in 2008 is not paid until 2009. Using the accrual basis of accounting, the expense should appear on:

 

A. the 2008 income statement.

 

B. the 2009 income statement.

 

C. neither the 2008 nor the 2009 income statement.

 

D. both the 2008 and 2009 income statements.

 

 

30 A company using the accrual basis of accounting pays $15,000 for a television advertising campaign. Commercials will run evenly in December, January, and February. How much expense will be reported on an income statement prepared for the month of December?

 

A. $0 B. $5,000

 

C. $10,000 D. $15,000

 

 

31 On November 1 of the current year, Prepaid Rent was debited $5,400 for three months of rent, in advance. The amount of the adjusting entry on December 31 is:

 

A. $1,800. B. $3,600.

 

C. $5,400. D. $0.

 

 

32 O’Connor Company purchased supplies totaling $21,600. By year end, $9,300 of supplies were still on hand. How much supplies expense should O’Connor recognize?

 

A. $9,300 B. $12,300

 

C. $21,600 D. $0

 

 

B

 

33 Arizona Teak Company paid $54,000 for computers. These computers have an estimated service life of 3 years and a salvage value of $3,000. After one year of use, the book value of the computers will be:

 

A. $17,000. B. $37,000.

 

C. $51,000. D. $0.

 

 

34 Closing entries transfer the balances of revenue and dividends accounts to which account?

 

A. Paid-in Capital B. Net Income

 

C. Common Stock D. Retained Earnings

 

 

35 Current assets are $40,000 and long-term assets are $50,000. Total liabilities are $60,000, of which current liabilities are 50%. The current ratio is:

 

A. 1.33. B. 1.50.

 

C. 3.00. D. 9.00.

 

 

36 Rosewood Company had Current Assets of $582, Current Liabilities of $433, Total Assets of $732, and only Current Liabilities are Total Liabilities. If Rosewood executes a note for $500 for six months, what is the new debt ratio?

 

A. 0.59 B. 0.75

 

C. 1.27 D. 2.15

 

 

37 Requiring employees to take annual vacations is a part of which characteristic of internal control?

 

A. Assignment of responsibilities

 

B. Separation of duties

 

C. Proper authorization

 

D. Competent and reliable personnel

 

 

38 Differences between the amount of cash reported on a company’s bank statement and the balance in the company’s Cash account before the bank reconciliation are primarily due to:

 

A. errors in the accounting process by the company.

 

B. errors made by the bank.

 

C. differences between the cash basis and accrual basis of accounting.

 

D. timing difference in recording transactions.

 

 

39 If a bookkeeper mistakenly recorded a disbursement as $810 instead of the correct amount of $180, the error should be shown on the bank reconciliation as a(n):

 

A. $180 addition to the books. B. $180 deduction from the books.

 

C. $630 addition to the books. D. $630 deduction from the books.

 

 

40 The bank statement balance is $6,450 and shows a service charge of $30, interest earned of $25, and a NSF check for $475. Deposits in transit total $1,850; outstanding checks are $1,125. What is the adjusted bank balance?

 

A. $5,725 B. $5,970

 

C. $7,175 D. $7,655

 

 

41 A purchase request:

 

A. identifies the need for merchandise and begins the purchasing process.

 

B. identifies that the merchandise has been received and ends the purchasing process.

 

C. is sent by the purchasing department to the customer who purchases the item.

 

D. includes the invoice, receiving report, purchase order and purchase request.

 

 

42 A receiving report is prepared by what department?

 

A. Accounting B. Shipping

 

C. Purchasing D. Marketing

 

 

 

 

 

43 An imprest petty cash fund of $400 was established for minor disbursements. At the end of the month, the fund included petty cash tickets for the purchase of $185 in supplies, $41 for postage, $86 for fuel and a delivery charge of $65. How much cash is required to replenish the fund?

 

A. $ 23 B. $226

 

C. $312 D. $377

 

 

44 Assuming a beginning cash balance of $2,000, estimated cash receipts of $105,900, and a desired ending cash balance of $3,500, then the estimated cash disbursements are:

 

A. $105,400. B. $104,400.

 

C. $106,900. D. $108,400.

 

 

45 An unrealized loss on a marketable security means that the:

 

A. value of the security at the time of sale exceeded the historical cost of the security.

 

B. current market value of the security exceeds its original cost.

 

C. historical cost of the security is less its current market value.

 

D. historical cost of the security exceeds its current market value.

 

 

46 Bigg and Talle Corporation uses the percentage-of-sales method to estimate uncollectibles. Net credit sales for the current year amount to $5,000,000 and management estimates 2% will be uncollectible. Allowance for Doubtful Accounts prior to adjustment has a credit balance of $16,000. After all necessary adjusting entries are made, the balance in Allowance for Uncollectible Accounts will be:

 

A. $116,000. B. $100,000.

 

C. $ 84,000. D. $ 16,000.

 

 

47 Calside Company signed a 15-month, $50,000, 6% note on June 1, 2008. The amount of interest to be accrued on December 31, 2008, is:

 

A. $3,000. B. $1,750.

 

C. $1,500. D. $1,141.

 

 

48 The maturity value of a $40,000 note at 11% for 5 months is:

 

A. $41,833. B. $40,880.

 

C. $44,400. D. $47,260.

 

 

49 VISA charges a fee for using credit cards. If Brunda’s is charged $40 on a sale of $1,600, what percentage is the fee?

 

A. 0.25 B. 2.50

 

C. 4.00 D. 3.50

 

 

50 Alex Rhodes’ net sales for the current period were $114,000 and average receivables were $96,250. What is the amount of one day’s sales (rounded)?

 

A. $312 B. $264

 

C. $427 D. $557

 

 

51 A company has $40,000 in cash, $75,000 in short-term investments, $263,000 in net current receivables, and $110,000 in inventory. The total current liabilities of the firm are $305,000. The quick ratio of the company is:

 

A. 0.63. B. 1.24.

 

C. 1.60. D. 1.76.

 

 

52 A company with net sales of $800,000, a beginning balance of net receivables of $70,000, and an ending balance of net receivables of $90,000 has a collection period of (rounded):

 

A. 110 days. B. 41 days.

 

C. 36 days. D. 32 days.

 

 

53 BMX Co. sells item XJ15 for $1,000 per unit, and has a cost of goods sold percentage of 80%. The gross profit to be found for selling 20 items is:

 

A. $20,000. B. $16,000.

 

C. $ 4,000. D. No gross margin can be calculated with a cost of goods sold percentage greater than 50%.

 

 

54 The purchasing manager for East Coast Hoggs is attempting to determine how much inventory to purchase for the upcoming month. The following information has been collected:

 

Current inventory $ 32,000 Budgeted cost of goods sold 80,000 $80,000

 

The manager wishes to end the month with ending inventory of $25,000. How much inventory must the company purchase?

 

A. $85,000 B. $82,000

 

C. $73,000 D. $67,000

 

 

55 Given the following data, what is the value of cost of goods sold as determined by the FIFO method?

 

Sales revenue 300 units at $15 per unit Beginning inventory 120 units at $9 per unit

 

Purchases 240 units at $10 per unit

 

 

A. $2,880 B. $2,912

 

C. $2,940 D. $4,500

 

 

56 Given the following data, what is the value of the gross profit as determined by the LIFO method?

 

Sales revenue 300 units at $15 per unit Beginning inventory 120 units at $9 per unit

 

Purchases 240 units at $10 per unit

 

 

A. $2,880 B. $2,940

 

C. $1,620 D. $1,560

 

 

57 Given the following data, calculate the gross profit using the average-cost method, if the selling price was $20 per unit.

 

Date Item Unit

 

1/1 Beginning inventory 40 units at $12 per unit

 

3/5 Purchase of inventory 18 units at $14 per unit

 

5/30 Purchase of inventory 24 units at $18 per unit

 

12/31 Ending inventory 20 units

 

 

A. $851.71 B. $634.78

 

C. $359.90 D. $283.90

 

 

Inc., has the

 


Solution details:
STATUS
Answered
QUALITY
Approved
ANSWER RATING

This question was answered on: May 23, 2022

Solution~00021147602394.zip (25.37 KB)


This attachment is locked

Our expert Writers have done this assignment before, you can reorder for a fresh, original and plagiarism-free copy and it will be redone much faster (Deadline assured. Flexible pricing. TurnItIn Report provided)

Pay using PayPal (No PayPal account Required) or your credit card . All your purchases are securely protected by .
SiteLock

About this Question

STATUS

Answered

QUALITY

Approved

DATE ANSWERED

May 23, 2022

EXPERT

Tutor

ANSWER RATING

GET INSTANT HELP

We have top-notch tutors who can do your essay/homework for you at a reasonable cost and then you can simply use that essay as a template to build your own arguments.

You can also use these solutions:

  • ■ As a reference for in-depth understanding of the subject.
  • ■ As a source of ideas / reasoning for your own research (if properly referenced)
  • ■ For editing and paraphrasing.

This we believe is a better way of understanding a problem and makes use of the efficiency of time of the student.

Get Free Price Quote