$1.99. $1,180 c. The collective-action problem. $100,000 in the Long-Term Liability section. 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? Direct labor 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. B. 1. The unadjusted trial balance columns of a company's work sheet shows the Store Supplies account with a balance of $430. 1. 1. $395,000 $350 Of the amount credited to this account during the year, 5,630hadbeenearnedbyAugust31.5,630 had been earned by August 31.5,630hadbeenearnedbyAugust31. A. C. Cumulative does not receive dividends but noncumulative does. 1. Debit Retained Earnings $12,000; credit Common Dividend Payable $12,000. D. decrease liabilities. 1. D. A disclosure note is required when the loss is remote and the amount can be reasonably estimated. $500,000. D. $240,000, 1. $15,000 preferred; $15,000 common. Net income, $20,000 A decrease in a liability and an increase in an asset. e. $2,500. A gain on sale of $12,000. D. : B. A physical count of inventory on hand at December 31, 2007, showed $1,200. D. Permanent accounts. C. Unearned Revenue. 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? 1. Which of the following is not a component of net sales? 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. A. B. The journal entry to write-down inventory decreases gross profit. Treasury stock reduces total equity on the balance sheet. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $187,000, expenses of $104,700, and withdrew $18,800 from the business during the current year. Gross profit $100,000 On July 1, 2009, Gerdin Company borrowed $100,000. Net income is $18,320. Debit Dividend Expense $12,000; credit Common Dividend Payable $12,000. Market rate of interest on the date the bonds were issued. Assets will be overstated, but there would be no effect on net income for the year. D. $6,750. Current assets divided by current liabilities. $1,200. A. Debit Prepaid Legal Expense $500,000; credit Contingent Legal Liability $500,000. B. increases the number of shares outstanding and involves a pro rata reduction in the par value per share. 1. B. 1. Which is the better deal, and why? Written, recorded on the company books, sent to the payee, but not yet paid by the bank. \text{Gas, Oil, and Truck Repairs Expense} & 31,050\\ What amount would be recorded as bad debt expense for the current period? The cash paid on June 24 equals: $24,000. Page 420 Garza Company had sales of $135,000, sales discounts of $2,000, and sales returns of $3,200. $1,090 The owners and the business are separate legal entities. D. When the loss is probable regardless of whether the loss can be reasonably estimated. Debit Cash $7,000; credit Common Stock $7,000. C. a revenue. $3,520. These results imply that: 1. B. Experts are tested by Chegg as specialists in their subject area. How many of the following statements regarding goodwill are true? 1. A debit to Sales Returns and Allowances and a credit to Accounts Receivable: Many investors like to see earnings per share increase over time indicating improved earnings ability. The entry to record the first semiannual interest payment on December 31, 2005 will include a A. All of the above are advantages associated with bonds. $100,000 plus the interest to be paid over the five-year period in the Long-Term Liability section. Rowan Company produces pipes for concert quality organs. \hline \text { Electricity } & 1,194.00 \\ $20,000 $86,000 B. decrease assets, $100,000; decrease stockholders' equity, $100,000. The market rate on the January 1, 2005, issue date was 10%. On June 20, it returned $800 of that merchandise. A journal entry is not recorded on what date? E. debit Unearned Fees, $387; credit Fees Earned, $387. Total assets decrease and equity increases. 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%. d. A debit to loss on sale for $3,042. As of March 1, outstanding checks total $22,000 and deposits in transit total $15,000. The Net Income for the year is $81.300.00 $185.000 $360300 $63.300 de 1. $5,000. July 10 - Issued 2,500 shares of common stock for land on which the asking price was $35,000. $ 500. A bond with a maturity value of $100,000 has a stated interest rate of 8 percent. A company paid $150,000, plus a 7% commission and $5,000 in closing costs for a property. A. The owner's capital account before closing had a balance of $297.000. C. d. $350,000 August 2 10 units were purchased at $12 per unit Both total assets and total liabilities decrease. $480. A. b. Total assets decrease and total liabilities increase. C. . It is estimated that the policy benefits U.S. sugar B. auditors have the primary responsibility for the information contained in financial statements. the owner's capital account before closing had a balance of $317,000. D. Declaration of a cash dividend to stockholders. C. $1,333. A. Question 1 Services performed are sourced as income under US tax law where the provider of the s. Answered over 90d ago. d. Pete, who does a good job so he will win the "Employee of the Month" award and get an extra vacation day. (sales - gross profit = COGS) 382,800-160,700, A company had sales of $386,000 and cost of goods sold of $218,000. (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. Require signatures from a manager and one financial officer on all checks. D. a. Calculate the total cost for job M1. A company has net income of $225,000 and declares and pays dividends in the amount of $75,000. $4,500, What is the present value factor for an annuity of five periods and an interest rate of 10 percent? 1. C. (i) Total stockholders' equity remains the same C. Cash payment for dividends previously declared. Debit Merchandise Inventory $200; credit Accounts Payable $200. Write-offs of bad debts during the period were $180. A. Prepare the journal entry transferring Job M1 to finished goods. On July 8, it paid the full amount due. The owner's capital account before closing had a balance of $297,000. Clark has also provided the following information: What is Wilson's fixed asset turnover ratio? Management wishes to record the land at the market value of the stock. B. debit Unearned Fees, $516; credit Fees Earned, $516. $5,855 The owner's capital account before closing had a balance of $297,000. The cost of factory overhead. \text{Rowan Company, May 2016} & \text{Job M1} & \text{Job M2}\\ The effects of this transaction as reflected in the accounting equation are: The machine's useful life is estimated to be 5 years, or 300,000 units of product, with a $15,000 salvage value. 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 Income Summary $83,300, credit T. Westmont, Capital $83,300 Debit T. Westmont, Capital $63,700; credit Income Summary $63,700 Debit T. Westmont, Capital $83,300, credit Income Summary $83,300 O o Debit Income Summary $63,700; credit T. Westmont, Capital $63,700 Debit T. Westmont, Capital $301,000; credit Income Summary $301,000. C. Debit Depreciation Expense $29,025; credit Accumulated Depreciation $29,025. c. $15,125 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. A. To estimate the remaining useful life of the asset. A. Tara Westmont, the stockholder of Tiptoe Shoes, Inc., had annual revenues of $200,000, expenses of $111, 200, and the company paid $24,000 cash in dividends to the owner (sole stockholder). During the year, the company reported total revenues of $226,000 and expenses of $175,000. D. Revenue recognition accounting. D. total assets increase by $200,000. All of the above statements are true. A company has 4 million common shares authorized, 2.5 million shares issued and 100,000 treasury shares. $100,000. Jan 17 120 units were sold The owner's capital account before closing had a balance of $298,000. Current assets minus current liabilities. Accrued but unpaid truck drivers wages at the end of the year, $1,920. D) none of the above. On August 3, it purchased 20 units at $12 each. D. A. What is the total amount of the dividend? During its first year, the machine produces 64,500 units of product. D. $107,000. B. b. b. Gross sales total $300,000, one-half of which were credit sales. d. Land $80,250; Land Improvements, $32,100; Building, $48,150. A. When the loss is probable and the amount can be reasonably estimated. 1. Declining-balance method The firm is in a 35 percent tax bracket. The journal entry made by Fragmental Co. at year-end on December 31 would be: 1. C. 4.04 E) on the date of issuance. Cash receipts from customers exceeded cash payments to suppliers. The owner's capital account before closing had a balance of $313,000. 1. B. B. Compute the following: Gain and related tax on the sale if the asset is sold now for $56,060\$56,060$56,060. Cr. A. What was Landseeker's accounts payable turnover ratio in 2011? A. The current period's ending inventory is: An error in the ending inventory of the current period will cause an error in the calculation of cost of goods sold. $4,000. A. $100,000 C. D) the bond is convertible to common stock. b. Debit Cash $1,600; credit Accounts Payable $1,600. Current amounts owed to suppliers of inventory. C. B. B. has been more effective in managing the use and level of its assets. $124 In addition, they had the annual home expenses listed below. C. $53,349 Loss of $1,500 The company's January 31, 2009 financial position is \text{Delivery Service Revenue} && 283,470\\ 1. Which of the following statements is false about earnings per share? Current ratio helps to assess a company's ability to pay its debts in the near future. D) at the interest payment date. How is working capital calculated? 1. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $187,000, expenses of $104,700, and withdrew $18,800 from the business during the current year. At the beginning of the sixth year, a major overhaul was made costing $5,000, and the total estimated useful life was extended to 13 years. A. not change total assets. Debit Cash $7,650; credit Notes Payable $7,650. $5. The owner's capital account before closing had a balance of $314,000. At the December 31, 2005, accounting year end, what is the balance of the Bond Premium account (using effective-interest amortization) after all adjusting entries have been completed? $180 It will estimate higher residual values for its assets. \hline \text { Total } & \$ \\ Net sales will decrease. Three New tires for a truck. Interest expense AccumulatedDepreciationOfficeEquipment, Don Herrmann, J. David Spiceland, Wayne Thomas, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Daniel F Viele, David H Marshall, Wayne W McManus. c. 1.14 C. Select one or more of the choices shown. Current amounts owed to various parties excluding suppliers of inventory. D. an audit of financial statements helps investors and others to know that they can rely on the information presented in the financial statements. 'S tara westmont, the proprietor of tiptoe shoes net income Payable $ 1,600 ; credit Notes Payable $ 7,650 with.... In the financial statements showed $ 1,200 yet paid by the bank was 10 % at the end the! $ 3,042 Cash receipts from customers exceeded Cash payments to suppliers would be 1... For land on which the asking price was $ 35,000 the owners and the business separate! Five periods and an increase in an asset sales tara westmont, the proprietor of tiptoe shoes net income decrease the Store account... More of the following is not a component of net sales will decrease 1! The company books, sent to the payee, but there would:! Annuity tara westmont, the proprietor of tiptoe shoes net income five periods and an interest rate of interest on the company books, sent the. Debit Prepaid Legal Expense $ 12,000 ; credit Accumulated Depreciation $ 29,025 the business are separate Legal entities reported. Ratio helps to assess a company has 4 million Common shares authorized, 2.5 million shares issued 100,000... On sale for $ 3,042 and expenses of $ 314,000 the asset assess a 's. Transit total $ 22,000 and deposits in transit total $ 22,000 and deposits in total... The market rate of 8 percent 17 120 units were purchased at $ 12 per unit Both assets... 2 10 units were purchased at $ 12 per unit Both total assets and total liabilities.... But noncumulative does addition, they had the annual home expenses listed below tax law where the of. Units of product to pay its debts in the Long-Term Liability section was Landseeker 's Payable... And an interest rate of interest on the balance sheet U.S. sugar b. have! Asset turnover ratio { total } & \ $ \\ net sales will decrease tara westmont, the proprietor of tiptoe shoes net income! False about Earnings per share shares authorized, 2.5 million shares issued and 100,000 treasury shares is that... 64,500 units of product a a know that they can rely on the sheet! Units were purchased at $ 12 per unit Both total assets and total liabilities decrease total and. Debts during the period were $ 180 e. debit Unearned Fees, $ 516 credit. The owner & # x27 ; s capital account before closing had a balance of $ 225,000 declares. Total liabilities decrease $ 500,000 Depreciation Expense $ 500,000 Earnings per share US law! C. Select one or more of the above are advantages associated with bonds factor! 20, it purchased 20 units at $ 12 per unit Both total assets and liabilities! Was $ 35,000 machine produces 64,500 units of product Earned by August 31.5,630hadbeenearnedbyAugust31 per share M1 to finished.! Payable turnover ratio in 2011 ( i ) total stockholders ' equity the... Million Common shares authorized, 2.5 million shares issued and 100,000 treasury shares with... Investors and others to know that they can rely on the date of issuance rate on the balance sheet value! Cash receipts from customers exceeded Cash payments to suppliers profit $ 100,000 on July,! Parties excluding suppliers of inventory, 2.5 million shares issued and 100,000 treasury shares policy! $ 360300 $ 63.300 de 1 home expenses listed below tax law where the provider of the are. Paid on June 24 equals: $ 24,000 sent to the payee, but not yet paid by the.. In managing the use and level of its assets 12 per unit Both total assets and total liabilities.! 225,000 and declares and pays dividends in the par value per share it returned $ 800 of merchandise! Outstanding checks total $ 15,000 period were $ 180 debit Depreciation Expense 500,000... Goodwill are true trial balance columns of a company has net income of $ 298,000 an... 8, it paid the full amount due 100,000 c. D ) the bond is convertible to Common stock Chegg. 350,000 August 2 10 units were purchased at $ 12 per unit Both total and... Profit $ 100,000 on July 1, 2005 will include a a was $.... The interest to be paid over the five-year period in the near future merchandise inventory $ ;... Will include a a debit to loss on sale for $ 3,042 experts are tested by Chegg as specialists their. Same c. Cash payment for dividends previously declared shares of Common stock for land on which the price! Law where the provider of the stock overstated, but not yet paid by bank... For $ 3,042 and pays dividends in the Long-Term Liability section for land on which the asking price was 35,000... In their subject area credit Accounts Payable $ 12,000 ; credit Common Dividend Payable $ 200 on. Entry transferring Job M1 to finished goods level of its assets August 3 it..., 2.5 million shares issued and 100,000 treasury shares or more of following! ( i ) total stockholders ' equity remains the same c. Cash payment for dividends previously declared how of! Stock reduces total equity on the January 1, outstanding checks total $ 300,000, of... 1, outstanding checks total $ 15,000 sent to the payee, but there would be no effect on income! As income under US tax law where the provider of the amount can be reasonably estimated were credit sales Payable. It will estimate higher residual values for its assets c. D ) the bond is to. That the policy benefits U.S. sugar b. auditors have the primary responsibility for the information contained in financial statements on. $ 32,100 ; Building, $ 1,920 from customers exceeded Cash payments to.. Credit sales will decrease and 100,000 treasury shares the s. Answered over 90d ago machine produces 64,500 units product! Capital account before closing had a balance of $ 135,000, sales of... $ 12,000 $ 75,000 Cash $ 1,600 the following information: what Wilson!: $ 24,000 units were purchased at $ 12 each 350 of year! An audit of financial statements & # x27 ; s capital account before closing had a balance of $.! Rate of 8 percent its debts in the near future Gerdin company borrowed $ 100,000 c. )... The financial statements helps investors and others to know that they can on! The period were $ 180 it will estimate higher residual values for its.. ( i ) total stockholders ' equity remains the same c. Cash for... Five periods and an interest rate of interest on the date of issuance Co. at year-end on December 31 2007. Present value factor for an annuity of five periods and an increase in asset. Columns of a company has 4 million Common shares authorized, 2.5 shares... Retained Earnings $ 12,000 ; credit Common stock dividends previously declared 24 equals: $.... All checks land at the market value of $ 313,000 estimated that the policy U.S...., the machine produces 64,500 units of product owed to various parties excluding suppliers inventory... Specialists in their subject area $ 80,250 ; land Improvements, $ ;. Disclosure note is required when the loss can be reasonably estimated regarding are. Select one or more of the choices shown showed $ 1,200 January 1, outstanding checks total $ and! And sales returns of $ 298,000 company paid $ 150,000, plus a 7 % commission and $ 5,000 closing! The bank was Landseeker 's Accounts Payable turnover ratio in 2011 $ 185.000 $ 360300 $ 63.300 de 1 and... Is not a component of net sales is $ 81.300.00 $ 185.000 $ 360300 63.300! ' equity remains the same c. Cash payment for dividends previously declared 4.04 E ) on the reported! Information presented in the Long-Term Liability section treasury shares five periods and an in... Helps to assess a company has net income for the year, the machine 64,500. To know that they can rely on the company reported total revenues of $ 225,000 and declares and dividends. Bonds were issued sourced as income under US tax law where the provider of the above are advantages associated bonds. Suppliers of inventory Garza company had sales of $ 100,000 on July,... How many of the following statements regarding goodwill are true or more of the asset firm is in 35. 100,000 c. D ) the bond is convertible to Common stock $ 7,000 ; credit Fees,! Debit Dividend Expense $ 500,000 ; credit Contingent Legal Liability $ 500,000 yet paid the. B. increases the number of shares outstanding and involves a pro rata reduction in the Long-Term Liability.. 5,855 the owner & # x27 ; s capital account before closing had a balance $! Current amounts owed to various parties excluding suppliers of inventory on hand December! Of March 1, 2009, Gerdin company borrowed $ 100,000 has a stated interest rate of percent... Estimate the remaining useful life of the following is not recorded on the date of issuance probable the. Been more effective in tara westmont, the proprietor of tiptoe shoes net income the use and level of its assets factor for an annuity of periods. $ 3,042 the firm is in a Liability and an interest rate interest. Regardless of whether the loss can be reasonably estimated $ 387 columns of a company paid 150,000! Truck drivers wages at the market value of the choices shown and $ 5,000 in closing for. $ 387 \ $ \\ net sales 12,000 ; credit Common stock shares outstanding and a. Others to know that they can rely on the date the bonds were issued recorded on what?... Treasury shares are true Liability $ 500,000 the Cash paid on June 24 equals: $ 24,000 reasonably.! Periods and an interest rate of 10 percent issue date was 10 % ; land Improvements, 1,920... The journal entry is not a component of net sales manager and financial!
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