Hoover Company had beginning inventory of $15,000 at March 1, 2014. During the
month, the company made purchases of $55,000. The inventory at the end of the month
is $17,300. What is cost of goods sold for the month of March?
a.$52,700
b.$55,000
c.$70,000
d.$72,300
Given the following account balances at year end, compute the total intangible assets on
the balance sheet of Janssen Enterprises.
a.$9,500,000.
b.$5,500,000.
c.$3,500,000.
d.$7,500,000.
Using the following information, prepare a bank reconciliation for Munoz Company for
May 31, 2014.
a.The bank statement balance is $8,300.
The cash account balance is $6,562
Outstanding checks totaled $1,950.
Deposits in transit are $600.
The bank service charge is $12.
Collection of note by bank, $400.
Use the following data to determine the total dollar amount of assets to be classified as
current assets.
a.$570,000
b.$400,000
c.$340,000
d.$290,000
Nelson Corporation sells three different products. The following information is
available on December 31:
When applying the lower of cost or market rule to each item, what will Nelson’s total
ending inventory balance be?
a.$3,450
b.$3,225
c.$3,975
d.$3,300
The following information is from the Income Statement of the Dirt Poor Laundry
Service:
The entry to close the expense accounts includes a:
a.credit to Income Summary for $3,050.
b.debit to Income Summary for $3,050.
c.debit to Salaries and Wages Expense for $1,950.
d.credit to Retained Earnings for $3,050.
A popular variation of the accounts receivable turnover is the
a.credit risk ratio.
b.concentration of credit risk.
c.bad debts ratio.
d.average collection period.
Nance Corporation’s December 31, 2014 balance sheet showed the following:
Nance’s total paid-in capital was
a.$46,860,000.
b.$47,490,000.
c.$46,230,000.
d.$27,060,000.
Which one of the following is not the correct date format for the respective financial
statement?
a.A balance sheet as of May 31, 2014
b.A statement of retained earnings as of May 31, 2014
c.An income statement for the month ended May 31, 2014
d.A statement of cash flows for the month ended May 31, 2014
CAB Inc. has 1,000 shares of 6%, $100 par value, cumulative preferred stock and
50,000 shares of $1 par value common stock outstanding at December 31, 2014. What
is the annual dividend on the preferred stock?
a.$60 per share.
b.$6,000 in total.
c.$600 in total.
d.$0.60 per share.
On January 1, Weatherholt Inc. issued $4,000,000, 9% bonds for $3,756,000. The
market rate of interest for these bonds is 10%. Interest is payable annually on December
31. Jean Loptein uses the effective-interest method of amortizing bond discount. At the
end of the first year, Weatherholt should report unamortized bond discount of
a.$219,600.
b.$228,400.
c.$206,440.
d.$204,000.
Shaffer Company acquires land for $62,000 cash. Additional costs are as follows.
Shaffer will record the acquisition cost of the land as
a.$62,000.
b.$63,690.
c.$65,610.
d.$65,370.
Assume that the Fitzgerald Corporation uses the indirect method to depict cash flows.
Indicate where, if at all, inventory purchased with cash would be classified on the
statement of cash flows.
a.Operating activities section.
b.Investing activities section.
c.Financing activities section.
d.Does not represent a cash flow.
On Friday of each week, Prawn Company pays its personnel weekly wages amounting
to $45,000 for a five-day work week.
Instructions:
(a)Prepare the necessary adjusting entry at year end, assuming December 31 falls on
Wednesday.
(b)Prepare the journal entry for payment of the week’s wages on the payday which is
Friday, January 2 of the next year.
The interest charged on a $250,000 note payable, at the rate of 6%, on a 90-day note
would be
a.$15,000.
b.$7,500.
c.$3,750.
d.$1,250.
On January 1, McCarver Corporation had 600,000 shares of $10 par value common
stock outstanding. On March 31 the company declared a 10% stock dividend. Market
value of the stock was $15/share. As a result of this event,
a.McCarver’s Paid-in Capital in Excess of Par Value account increased $300,000.
b.McCarver’s total stockholders’ equity was unaffected.
c.McCarver’s Stock Dividends account increased $900,000.
d.All of these answer choices are correct.
Brevard Corporation purchased a taxicab on January 1, 2013 for $25,500 to use for its
shuttle business. The cab is expected to have a five-year useful life and no salvage
value. During 2014, it retouched the cab’s paint at a cost of $1,200, replaced the
transmission for $3,000 (which extended its life by an additional 2 years), and tuned-up
the motor for $150. If Brevard Corporation uses straight-line depreciation, what annual
depreciation will Brevard report for 2014?
a.$5,100.
b.$3,900.
c.$4,125.
d.$4,100.
An aging of a company’s accounts receivable indicates that $4,500 are estimated to be
uncollectible. If Allowance for Doubtful Accounts has a $1,600 credit balance, the
adjustment to record bad debts for the period will require a
a.debit to Bad Debt Expense for $4,500.
b.debit to Allowance for Doubtful Accounts for $2,900.
c.debit to Bad Debt Expense for $2,900.
d.credit to Allowance for Doubtful Accounts for $4,500.