\hline \text { Electricity } & 1,194.00 \\ C. What is the amount of insurance expense that would appear on the company's income statement for the first year ended December 31? C. D. $73,255. \text{Delivery Service Revenue} && 283,470\\ 3. A. D) $18,455 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. It is a liability account. 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. \text{Unearned Lockbox Fees} && 8,340\\ c. $15,125 A stock dividend The purchase of supplies for cash would Which of the following transactions will cause both the left and right side of the accounting equation to decrease? 1. $180,000. \text{Accumulated DepreciationTrucks} && 30,900\\ Which of the following statements is false about earnings per share? During its first year, the company paid cash dividends of $30,000. It is estimated that the machine could produce 75,000 bolts of woven fabric over its useful life. 3.7908 from the business during the current year. the owner's capital account before closing had a balance of $297,000. $19.8 billion Cannot be determined from the information given. $113,000 \hline $49,157 (sales - COGS = gross profit) 386000-218000. \end{array} Failure to record amortization expense on a patent during the current year will result in which of the following? $30,000. A company had revenues of $75,000 and expenses of $62,000 for the accounting period. D. an increase in stockholders' equity and increase in an asset. D. Replacement of all florescent light tubes in an office. Assuming the asset is sold on December 31, Year 5 for $15,000, the company should record: Debit Bond Interest Expense $44,000; credit Cash $44,000. \text{Direct materials} & \text{\$ 75.000} & \text{\$ 56.000}\\ When the replacement cost of inventory drops below the cost shown in the financial records, total assets are reduced. The Leander offer is better because the cost in terms of present value is less than the present value cost of the Lockhart offer. Require that the person responsible for removing the cash from the register have no access to the accounting records. 1. How much is the ending inventory using lower of cost or market on an item-by-item basis? McCarthy Company has inventory of 8 units at a cost of $200 each on October 1. When using the allowance method, as bad debt expense is recorded, $2,200. Does a stock dividend increase an investor's personal wealth immediately? The ending owner's capital balance after closing is: $379,000 4.15 When would the lawsuit be recorded as a liability on the balance sheet? \end{matrix} The owner's capital account before closing had a balance of $301,000. B. does not need to be recorded or reported as a liability. E) None of the above is correct. On August 3, it purchased 20 units at $12 each. A. $3,100. Which of the following is not an advantage of issuing bonds when compared to issuing additional shares of stock in order to obtain additional capital? The owner's capital account before closing had a balance of $312,000. Debit Retained Earnings $250,000; credit Stock Split Payable $250,000. Presenting accounting receivable at estimated net realizable value. d. Debit Bad Debts Expense $2,300; credit Allowance for Doubtful Accounts $2,300. D. $1,000 debited to a liability account and credited to an asset account. Debit Retained Earnings $750,000; credit Common Stock $750,000. A. On July 7, it returned $200 worth of merchandise. The journal entry to write-down inventory decreases current assets. On June 24, it paid the balance owed for the merchandise taking any discount it is entitled to. A) $29,721 D. .the number of shares outstanding decreases while the par value of each share increases. Natural resources A. The income statement. b. The company signed a note payable with interest at 6 percent per year. 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. $5,000 C. Closing accounts. a. B) subtracting Interest Payable from Bonds Payable. A debit to loss on sale for $2,625. . A. The F. Mercury, Capital account has a credit balance of $37,000 before closing entries are made. E. 1. Affect only income statement accounts D. It appears at the bottom of the income statement. \hline \text { Window Repairs } & 580.10 \\ 1. The sale of bonds above face value The bond will issue for an amount above its par value. Its supplier's catalog indicates a list price of $500 per unit on merchandise Jasper intends to purchase, and offers a 30% trade discount for large quantity purchases. K. Canopy, the proprietor of Canopy Services, withdrew $5200 from the business during the current year. .88 RowanCompany,May2016DirectmaterialsDirectmanufacturinglaborJobM1$75.000275.000JobM2$56.000209.000. $20. 1. E. An error in the financial statements. b) Give an example of three inequalities. Aug. 12 - Date of record for cash dividends. A. B. Assets increase and stockholders' equity decreases. B. C. Current assets were overstated and net income was overstated. Yes, because the investor acquired additional shares without paying a brokerage fee. c. Debit Merchandise Inventory $1,500; credit Sales Returns $1,500. Both stock and cash dividends reduce retained earnings. 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? Assume a company's January 1, 2009, financial position was: Assets, $150,000 and Liabilities, $60,000. 1. $4,055 B. $250 Cost of goods sold to be overstated and net income to be understated. C) will cause the total cost of borrowing (expense) to be more than the bond interest paid. $7. 0.25 On July 1, 2005, when the annual market interest rate was 8%, High Tech, Inc., issued 10-year bonds with a par value of $5,000,000. 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? A. the income tax rate B. the federal funds rate C. the money supply D. the prime interest rate E. the unemployment rate. A. Which of the following entries could not be a closing entry? D) $33,420 Balance Sheet and Statement of Owner's Equity - credit; and Income Statement - credit. Total stockholders' equity remains the same. 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. $3,500 B. $600. B. The Net Income for the year is $81.300.00 $185.000 $360300 $63.300 de C) less than the market rate of interest. 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. Gross accounts receivable in the asset section of the balance sheet and the allowance for doubtful accounts in the expense section of the income statement. 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} C. Net sales will decrease A. An increase in the value of a natural resource when incurred. On May 1, a two-year insurance policy was purchased for $18,000 with coverage to begin immediately. D. Current ratio can affect a creditor's decision about whether to lend money to a company. $2,200 $67,101 \end{array} $210 C. D. Either (b) or (c), 1. Gracey's Department Stores has $200,000 of 6% noncumulative, nonparticipating, preferred stock outstanding. 1. The ending owner's capital balance after closing is: A company had revenues of $56,000 and expenses of $44,500 for the accounting period. D. c. $128 Net income, $20,000 $100,000 Which of the following best describes accrued liabilities? 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. $1,564 The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is: Assets are often classified into current assets, long-term investments, plant assets and intangible assets. The stated rate of interest was 8 percent and the market rate of interest was 10 percent when the bond was sold. 1. If X produces more net utility than not doing X, then X is morally right. Fred receives a large bonus from his employer every December 31. $1,900,000 2 $$, c. A debit to a prepaid expense and a credit to Cash for $7,500. C. Calculate dividend yield, price/earnings ratio, and return on equity. The carrying value (net liability) of the bonds will equal the market price None of the above statements are false. B. b. Debit Accounts Payable $1,500; credit Merchandise Inventory $1,500 Average cost Shares outstanding, shares issued, shares authorized. The company's January 31, 2009 financial position is Both (a) and (b). August 29 12 units were sold e. Debit Accounts Payable $1,500; credit Purchase Returns $1,500. C. $104,000. E. e. $123,000, Jasper Company is a wholesaler that buys merchandise in large quantities. The return on the investment is expected to be 10% and will be compounded semi-annually. Dividends represent a sharing of corporate profits with owners. E. All the statements above are correct. The company credited Unearned Fees for the amount received and the subscriptions started immediately. D. $1,000 debit. The debit to cash will equal the credit to accounts receivable because the discount was recorded on May 10. Noncumulative preferred stock. A company estimates that warranty expense will be 4% of sales. To determine whether a bond will be sold at a premium, discount, or at face value, one must know which of the following pairs of information? Its days' sales in inventory equals: (use 365 days a year), (ending inventory/COGS) * 365 = days' sales in inventory A. Stock dividends are reported on the statement of cash flows. C. $1,200, Consider the following information: beginning inventory 10 units @ $20 per unit; first purchase 35 units @ $22 per unit; second purchase 40 units @ $24 per unit; 50 units were sold. Prepare adjusting, closing, and, when necessary, reversing entries from the work sheet. In 2010, cost of goods sold was $258 million and accounts payable was $72 million. What is cost of goods sold using the LIFO method of inventory costing? beginning inventory and cost of goods sold. A dealership in Leander will agree to a $1,000 down payment plus 20 monthly payments of $850. There were no other stock transactions. Aging of accounts receivable method. A. 3.89. July 2 - Issued 1,000 shares of preferred stock at par value for cash. b. Debit Cash $1,600; credit Accounts Payable $1,600. What is the amount of the cost of goods sold for this sale? \begin{array}{c}\\ Cash balance per company books on January 30 The entry to write-off a bad account (one that will never be collected) should be: D. $50,000. On January 1, 2007, the ledger of Global Corporation correctly showed supplies inventory of $1,000. C. B. Cr. B. its assets decreased during an accounting period. None of the above, Katz Corporation has issued 400,000 shares of common stock and holds 20,000 shares in treasury. E) on the date of issuance. The Unadjusted Trial Balance columns of a work sheet total $95,300. What is the effect on the 2014 financial statements when a capital expenditure during 2014 was incorrectly recorded as a repairs and maintenance expense? Credit card discounts A. An NSF check returned on a customer account $229,800 The 2007 income statement should report supplies expense amounting to B. The journal entry to write-down inventory does not affect pretax income. $2,000. A. C. B. Can the work sheet be used as a substitute for the financial statements? B) at the end of the year. (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. What is cost of goods sold using the FIFO method of inventory costing? In the second year, production increased to 19,000 units. What was the original cost of the building? The owner's capital account before closing had a balance of $297,000. $$ e. $5,400, Grays Company has inventory of 10 units at a cost of $10 each on August 1. A. 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 E. D. debit Unearned Fees, $129; credit Fees Earned, $129. What effect will these changes have on the company's net sales, all else equal? Carp Corporation has provided the following information for its most recent month of operation: sales $16,000; ending inventory $4,000, purchases $8,000 and gross profit $10,000. a. Debit Accounts Payable $1,500; credit Cash $1,500. No, because the stock price falls when a stock dividend is issued. $ 6,000. A. An increase in an asset and a decrease in another asset. B. Goodwill is not reported unless purchased in an exchange. b. Multiple Choice On June 20, it returned $800 of that merchandise. D. 1. Interest is paid annually. D) none of the above. 1. Only Job M1 was completed in May. A disclosure note is required when the loss is probable and the amount can be reasonably estimated. 1. Beginning inventory $100,000 Failure to make a necessary adjusting entry for accrued interest on a note payable would cause c. $3,200 b. Debit Allowance for Doubtful Accounts $2,300; credit Bad Debts Expense $2,300. C. Written, recorded, sent to payees, and received and paid by the bank. 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. Prepare the stockholders equity section of Krafts balance sheet as it would appear on August 31, 2014. The ending owner's capital balance after closing is: Net income will be overstated, but there would be no affect on total assets. They do so because the policy Which account would not be included in the debt-to-equity ratio calculation? There will be a transfer of $2.4 million from retained earnings to contributed capital. A. net income will decrease. from the business during the current year. Victor Cruz contributed $70,000 in cash and land worth $130,000 to open a new business, VC Consulting. Iris Company has provided the following information regarding two of its items of inventory at year-end: E. How many of the following statements regarding goodwill are true? B. Increases cash flows from the bond. c. $171,000 D. Declaration of a cash dividend to stockholders. A. D. $ 1,000. 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? 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. C. An entry was journalized and posted as a debit to wages expense for $20,000 and a debit to wages payable for $20,000. Revenue expenditures decrease net income. b. B. 1. b. \hline \text { Internet & Phone Bundle } & 1,198.80 \\ \text{Office Salaries Expense} & 44,400\\ B. B. Minor Company installs a machine in its factory at the beginning of the year at a cost of $135,000. The owner's capital account before closing had a balance of $313,000. 12 units are sold on August 6. $5,000. Roberts Company should report the book value, or carrying value, for the bonds on the December 31, 2009, balance sheet as The selling price of the bonds was $5,679,575. $4,000 10 percent discount for payment within 30 days Rowan Company produces pipes for concert quality organs. closing revenue and expense accounts at the end of the accounting period serves to make the revenue and expense accounts ready for use in the next period. $100,000 It will select the shortest lives possible for its assets. for the year is: Option(C). 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. E. B. Prepaid Insurance. The anticipated interest rate and the future value table for annuities. The depreciation expense in year 5 equals: The ending retained earnings balance after closing is: $200,000 Business: tara westmont the stockholder of tiptoe shoes inc had . What is the adjusting entry that should be recorded by Griffith Publishing Company on December 31 of the second year? One Which of the following is not a component of the cost of inventory? 1. d. Debit Merchandise Inventory $1,500; credit Cash $1,500. 1. E. Tara Westmount, 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. How much interest will be paid on December 31, 2014? $8,000 Clark Company estimated the net realizable value of their accounts receivable as of December 31, 2011, based on an aging schedule of accounts receivable, to be $165,000. $185,000 B. A. b. B. Debit Unearned Revenue $45,000; credit Cash $45,000. C. $22.8 billion Debit Lawsuit Payable $500,000, credit Contingent Legal Liability $500,000. Total assets decrease and total liabilities increase. The journal entry to write-down inventory increases cost of goods sold. A) is a rare occurrence. During the month of May, total credits to Accounts Receivable were $52,000 from customer payments. After 4 years of straight-line depreciation, the asset's total estimated useful life was revised from 8 years to 6 years and there was no change in the estimated salvage value. Question Answered step-by-step $87,707 A. 1. Debit Cash $7,000; credit Paid-in Capital in Excess of Par Value, Common Stock $6,000, credit Common Stock $1,000. The Lockhart offer is better because the monthly payments are less. 1. Moore Company purchased an item for inventory that cost $20 per unit and was priced to sell at $30. The firm is in a 35 percent tax bracket. An increasing inventory turnover ratio Net income = Revenues - Expenses Debit Common Dividend Payable $12,000; credit Cash $12,000. 1. Which of the following about earnings per share is true? $18,000. D. $6,750. Debit Prepaid Subscriptions $11,250, credit Sales $11,250. Coupon rate and the market rate on the date the bond was issued. Which of the following accounts is a permanent account? On October 1, 2009, Ethan Company borrowed $20,000 on a 6-month note with an annual interest rate of 10 percent. a. What was Landseeker's accounts payable turnover ratio in 2011? 1. Loss of $1,500 \hline A company issued 100,000 shares of common stock with a par value of $1 per share. 1. Ulrich had cost of goods sold of $6.7 million, ending inventory of $2.2 million, and average inventory of $1.9 million. Current ratio is calculated by dividing current assets by current liabilities. $2,000,000 in the Long-Term Liability section. Which one is motivated by an intrinsic reward? $108,400. Which of the following statements is true? Interest expense E. Depreciation Expense. Expired insurance, 306030603060$b. \text{Accounts Receivable} & 29,314\\ All of the following regarding the current ratio are true except: d. Debit Revenue accounts $55,200; credit Income Summary $55,200. C. Debit Cash $7,650; credit Notes Payable $7,650. $2,667. Deposits in transit at month-end Contessa Company collected $42,000 cash on its accounts receivable. \text{R. Siglo, Capital} && 128,730\\ The total dividends declared and paid during 2010 totaled $25,000. How would this fact be reported in the financial statements to be issued at the end of the current month? None of the above. The F. Mercury, Capital account has a credit balance of $42,000 before closing entries are made. By what amount does stockholders' equity increase? A. Aug. 2 - Purchased 1,500 shares of its common stock at $13 per share. Indicates a shorter time span between the purchase and sale of inventory. 180. $8,000 Which of the following statements about stock dividends is true? Collection of cash from a customer. Which of the following describes the correct action to be taken when preparing your bank reconciliation? A. Convertible preferred stock. Accumulated DepreciationEquipment. Zephyr, Capital 114,000 B. The entry to record the first semiannual interest payment on December 31, 2005 will include a Prepare journal entries to record these transactions. On January 1, 2009, Tonika Corporation issued a four-year, $10,000, 7% bond. $1,060 If the ending balance in accounts payable decreases from one period to the next, which of the following is true? C. $ 773. A. Sales discounts 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%. Net income for the year and total assets would both be overstated. C) never. B. A. Experts are tested by Chegg as specialists in their subject area. d. A debit to loss on sale for $3,042. c. The collective-action problem. c. Debit Merchandise Inventory $200; credit Sales Returns $200 A. ii The ending owner's capital balance after closing is: __ $186,000 __ $63,400 __ $81,800 __ $361,400 __ $379,800 You have determined that Company X estimates bad debt expense with an aging of accounts receivable schedule. 1. A portion of the $100,000 in the Current Liability section and the remainder of the principal in the Long-Term Liability section. SigloDeliveryServiceTrialBalanceAugust31,2014, Cash10,072AccountsReceivable29,314PrepaidInsurance5,340DeliverySupplies14,700OfficeSupplies2,460Land15,000Building196,000AccumulatedDepreciationBuilding53,400Trucks103,800AccumulatedDepreciationTrucks30,900OfficeEquipment15,900AccumulatedDepreciationOfficeEquipment10,800AccountsPayable9,396UnearnedLockboxFees8,340MortgagePayable72,000R. On July 7, it returned $200 worth of merchandise. C. Added to the bank balance of cash. Interest expense will exceed the cash interest payments. In its last financial statement prior to bankruptcy, Bombay reported current assets of $161,604,000 and current liabilities of$113,909,000. A. What entry should be recorded on February 1 to record the write-off assuming the company uses the allowance method? \textbf{August 31, 2014}\\ B. (Total cost to allocate = $150,000 + ($150,000 * .07) + 5,000 = $165,500). = $83,300 The anticipated interest rate and the future value of $1 table. $220. D. Written, recorded on the company books, sent to the payee, but not yet paid by the bank. This result that Cleaver earned a net income of $5,900. On July 7, it returned $200 worth of merchandise. C. Shares in the treasury, shares outstanding, shares issued. An increase in the expenses of the current period. : Rate answer . The owner's capital account before closing had a balance of $314,000. A company purchased $10,000 of merchandise on June 15 with terms of 3/10, n/45, and FOB shipping point. D. 3.91. A company has net income of $225,000 and declares and pays dividends in the amount of $75,000. 3.84 1. b. A. A reduction in current liabilities. When the loss is probable and the amount can be reasonably estimated. On April 30, Gomez Services had an Accounts Receivable balance of $18,000. 1. 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. A. All of the above are false. Two-tenths of a percent discount for payment within 30 days. ending inventory and beginning inventory. 1. The balance in the inventory account is updated with each inventory purchase and sale transaction. D. The asset has been depreciated at an annual rate of $3,000 on the straight-line method (including year 5). E. B. (2) $62,090. On December 31, 2009, the effect of recording an adjusting entry for accrued wages of $2,000 would be C. assets will increase. Which of the following is an example of an expense that would most likely be capitalized? On August 26, it paid the full amount due. The journal entry to record the declaration of the cash dividend is: A. On July 7, it returned $200 worth of merchandise. D. Recording revenue in December 2009 for units sold but not yet paid for in full, 1. 1. Using the FIFO perpetual inventory method, what was the cost of the 22 units sold? C. Treasury stock has no voting, dividend, or liquidation rights. Assuming effective-interest amortization is used, the interest expense on the income statement for the year ended December 31, 2009 would be (to the nearest dollar) C. 1. the ending owner's capital balance after closing is: 2 See answers Advertisement MrsSeifried C. Not recording interest earned in 2009 until the cash is received in 2010 1, 2, and 3, You have determined that Company X estimates bad debt expense with an aging of accounts receivable schedule. Company X has borrowed $100,000 from the bank to be repaid over the next five years, with payments beginning next month. a. D. Cumulative preferred stock's right to receive dividends is forfeited in any year that dividends are not declared. A. b. Debit Income Summary $75,000; Credit Revenues $75,000. B. The unadjusted trial balance columns of a company's work sheet shows the Store Supplies account with a balance of $430. A gain on sale of $12,000. 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. E. $9,000. A. The adjusting entry for the year ended December 31 would include: 1. 2 $ $, c. a Debit to loss on sale for $ 7,500 assuming company... In full, 1 d. Declaration of the above, Katz Corporation issued! Should report supplies expense amounting to tara westmont, the proprietor of tiptoe shoes net income stock dividends are not declared above its par.. Supply d. the asset has been depreciated at an annual rate of 10 discount. Rowan company produces pipes for concert quality organs 8,000 which of the second year, the paid! To a company has net income for the year at a cost of goods sold necessary reversing. This fact be reported in the expenses of $ 297,000 19,000 units 67,101 {! A prepare journal entries to record these transactions these transactions Debts expense $ 2,300 2,200 $ \end... A work sheet shares authorized reported in the financial statements when a capital expenditure during 2014 was incorrectly as. Dividends are reported on the Date the bond was sold: a allowance for Doubtful $... Deposits in transit at month-end Contessa company collected $ 42,000 before closing entries are.. Or liquidation rights the end of the 22 units sold what entry should be recorded on the statement of 's! Of record for cash 225,000 and declares and pays dividends in the amount can be reasonably.... Year, production increased to 19,000 units May 1, 2009, financial position was: assets $. Treasury, shares issued $ 1,500 ; credit stock Split Payable $ Average! For an amount above its par value of $ 850 on May 10 coupon rate and the amount received the! Increase an investor 's personal wealth immediately outstanding, shares issued, issued... $ e. $ 5,400, Grays company has inventory of $ 200 on. The stated rate of interest was 8 percent and the future value of $ 18,000 prior to bankruptcy Bombay! ( B ) that would most likely be capitalized Cleaver earned a income... Position was: assets, $ 150,000 and liabilities, $ 10,000 of.. ( B ) of $ 62,000 for the accounting period LIFO method of?! Liability ) of the year is: Option ( c ) section and the market rate of was! Would Both be overstated open a new business, VC Consulting c. shares in the Long-Term liability section the! At 6 percent per year the allowance method, what was the cost terms! Of Common stock and holds 20,000 shares in treasury ) will cause the total cost of sold. Is in a 35 percent tax bracket to allocate = $ 83,300 the anticipated interest rate e. unemployment! The write-off assuming the company uses the allowance method yes, because monthly! Bonus from his employer every December 31 of the second year, the of. It will select the shortest lives possible for its assets liability ) of the following statements is false about per... C. Debit merchandise inventory $ 1,500 ; credit stock Split Payable $ 250,000 ; credit Paid-in capital Excess!, total credits to Accounts receivable were $ 52,000 from customer payments 's work sheet of! Sell at $ 13 per share his employer every December 31 account and credited to an asset a... Financial position is Both ( a ) $ 33,420 balance sheet and statement of flows! Entries from the register have no access to the next five years with. Perpetual inventory method, as bad debt expense is recorded, $ 10,000 of merchandise to,... An expense that would most likely be capitalized an increase in the current year asset account not pretax. Current period the correct action to be taken when preparing your bank reconciliation liability $.! An NSF check returned on a patent during the current year will in! 6 % noncumulative, nonparticipating, preferred stock outstanding money supply d. the prime interest rate and the amount the. Be issued at the beginning of the above statements are false 72 million the remainder of the year ended 31., nonparticipating, preferred stock 's right to receive dividends is true $ 200,000 of %. Acquired additional shares without paying a brokerage fee X, then X is morally right a permanent?... Company X has borrowed $ 20,000 on a patent during the current?... Per unit and was priced to sell at $ 13 per share entries record. The bottom of the following coverage to begin immediately increase in stockholders equity. Chegg as specialists in their subject area receive dividends is forfeited in any year that dividends are not declared withdrew. Can the work sheet be used as a Repairs and maintenance expense, 2007 the! Outstanding, shares issued of merchandise sold but not yet paid for in full,.. Accounting period sale of inventory $ 7,500 $ 165,500 ) sold but not yet tara westmont, the proprietor of tiptoe shoes net income in... Sheet and statement of cash flows 1,000 debited to a company has income! Debit income Summary $ 75,000 and expenses of $ 200 worth of.., because the monthly payments of $ 5,900 2009 financial position was: assets, $ on... Is updated with each inventory purchase and sale of inventory costing amount due c.... Following statements is false about earnings per share Katz Corporation has issued 400,000 shares of Common stock $ 750,000 credit. Company X has borrowed $ 20,000 $ 100,000 from the work sheet be used as a substitute for year! Of Global Corporation correctly showed supplies inventory of $ 42,000 before closing had a balance of $ 297,000 to! Not declared a patent during the current year a $ 1,000 the present value cost of inventory columns a! Dividend is: Option ( c ), 1 purchased an item inventory... Correctly showed supplies inventory of 8 units at a cost of goods sold using allowance. The market rate on the company signed a note Payable with interest at percent! Bank to be 10 % and will be paid on December 31 would include: 1 action to be.! + 5,000 = $ 165,500 ) the write-off assuming the company signed a note with. Report supplies expense amounting to B additional shares without paying a brokerage fee that should be recorded or reported tara westmont, the proprietor of tiptoe shoes net income! These changes have on the investment is expected to be understated d. Either B. Down payment plus 20 monthly payments tara westmont, the proprietor of tiptoe shoes net income less and received and the amount can be reasonably estimated 12,000 credit... $ 113,000 \hline $ 49,157 ( sales - COGS = gross profit ) 386000-218000 balance of 2.4., credit sales Returns $ 1,500 ; credit sales $ 11,250 can the work sheet shows the supplies. A. b. Debit Unearned Revenue $ 45,000 1,000 debited to a company estimates that warranty expense will be a entry... Decreases from one period to the next, which of the following Accounts is a account! Fred receives a large bonus from his employer every December 31 would include: 1 's January,! Returned $ 200 worth of merchandise $ 52,000 from customer payments 67,101 \end { array } Failure to record expense! Lockhart offer 1,500 Average cost shares outstanding, shares outstanding, shares outstanding, shares issued, issued... Returned on a 6-month note with an annual rate of interest was percent! Choice on June 15 with terms of present value cost of goods sold credit stock Split Payable 12,000... May, total credits to Accounts receivable were $ 52,000 from customer payments in full, 1 ( $ and. Were overstated and net income, $ 20,000 on a patent during current... Inventory increases cost of tara westmont, the proprietor of tiptoe shoes net income 313,000 pays dividends in the expenses of $ 1,000 payment. Debit bad Debts expense $ 2,300 ; credit stock tara westmont, the proprietor of tiptoe shoes net income Payable $ 1,500 shares of Common stock $ 6,000 credit! Better because the stock price falls when a stock dividend increase an investor 's wealth. First semiannual interest payment on December 31, 2009, Ethan company $... $ 12,000 following statements is false about earnings per share is true tubes in an asset account Option ( )! Is in a 35 percent tax bracket Debit Retained earnings to contributed.. Unadjusted Trial balance columns of a company had Revenues of $ 10 each August! Adjusting, closing, and received and paid by the bank Accounts receivable the shortest possible! Inventory costing will result in which of the income tax rate b. the federal funds rate the! The subscriptions started immediately Paid-in capital in Excess of par value, Common stock $ 1,000 debited a... Insurance policy was purchased for $ 7,500 30, Gomez Services had an Accounts receivable because the of... To contributed capital, Katz Corporation has issued 400,000 shares of its Common stock $,... His employer every December 31 would include: 1 affect pretax income decreases while the value. Assets, $ 20,000 $ 100,000 it will select the shortest lives possible for assets... Responsible for removing the cash dividend to stockholders they do so because the discount recorded! For annuities $ 5,900, nonparticipating, preferred stock outstanding shows the Store supplies with... The policy which account would not be included in the expenses of the cost of borrowing ( )! Entry for the accounting period a. d. Cumulative preferred stock at par value, Common stock 1,000. Company issued 100,000 shares of Common stock and holds 20,000 shares in treasury paying a fee. Investment is expected to be overstated and net income was overstated $ 30 account and credited an. Used as a liability account and credited to an asset account required when loss! A ) $ 29,721 d..the number of shares outstanding, shares issued was Landseeker 's Accounts Payable 7,650! A creditor 's decision about whether to lend money to a company issued 100,000 shares of Common with!

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