1) all of the following bank reconciliation items would result in an adjusting entry on
the companys books except
a.interest earned
b.deposits in transit
c.fee for collection of note by bank
d.nsf check of customer
2) the cost of land does not include
a.real estate brokers’ commission
b.annual property taxes
c.accrued property taxes assumed by the purchaser
d.title fees
3) the statement of cash flows would disclose the payment of a dividend
a.nowhere on the statement
b.in the operating activities section
c.in the investing activities section
d.in the financing activities section
4) the paid-in capital in excess of par value is increased in the accounting records when
a.the number of shares issued exceeds par value
b.the stated value of capital stock is greater than the par value
c.the market value of the stock rises above par value
d.capital stock is issued at an amount greater than par value
5) crestwood department store had net credit sales of $13,000,000 and cost of goods
sold of $9,000,000 for the year. the average inventory for the year amounted to
$2,500,000. the average days in inventory during the year was approximately
a.261 days
b.122 days
c.101 days
d.70 days
6) suppose you have a winning lottery ticket and you are given the option of accepting
$1,000,000 three years from now or taking the present value of the $1,000,000 now. the
sponsor of the prize uses a 5% discount rate. if you elect to receive the present value of
the prize now, the amount you will receive is
a.$863,840
b.$839,620
c.$890,000
d.$1,000,000
7) when using the periodic inventory system, which of the following is not a step in
determining cost of goods purchased?
a.add freight in
b.subtract purchase returns and allowances
c.subtract cost of ending inventory
d.all of these are necessary steps
8) the cash records of the dillon company show the following:
1>the july 31 bank reconciliation indicated that deposits in transit totaled $390. during
august the general ledger account, cash shows deposits of $11,300, but the bank
statement indicates that only $9,540 in deposits were received during the month.
2>the july 31 bank reconciliation also reported outstanding checks of $850. during the
month of august, the dillon company books show that $11,670 of checks were issued,
yet the bank statement showed that $11,300 of checks cleared the bank in august.
there were no bank debit or credit memoranda and no errors were made by either the
bank or the dillon company.
answer the following questions:
(a)what were the deposits in transit at august 31?
(b)what were the outstanding checks at august 31?
9) an investment by the stockholders in a business increases
a.assets and stockholders equity.
b.assets and liabilities.
c.liabilities and stockholders equity.
d.assets only.
10)
holcomb corporation has issued common stock only. the company has been successful
and has a gross profit rate of 20%. the information shown below was taken from the
company’s financial statements.
instructions
compute the following:
(a)receivables turnover and the average number of days required to collect the accounts
receivable.
(b)the inventory turnover and the average days in inventory.
(c)return on common stockholders’ equity.
11) giraldi corporations stockholders equity section at december 31, 2011, appears
below:
on june 30, 2012, the board of directors of giraldi corporation declared a 10% stock
dividend, payable on july 31, 2012, to stockholders of record on july 15, 2012. the fair
market value of giraldi corporations stock on june 30, 2012, was $16.
on december 1, 2011, the board of directors declared a 2 for 1 stock split effective
december 15, 2012. giraldi corporations stock was selling for $18 on december 1, 2012,
before the stock split was declared. par value of the stock was adjusted. net income for
2012 was $210,000 and there were no cash dividends declared.
instructions
(a)prepare the journal entries on the appropriate dates to record the stock dividend and
the stock split.
(b)fill in the amount that would appear in the stockholders equity section for jardinn
corporation at december 31, 2012, for the following items: