The following totals for the month of March were taken from the payroll records of
Kern Company.
The entry to record accrual of employer’s payroll taxes would include a
a.debit to Payroll Tax Expense for $7,263
b.debit to Payroll Tax Expense for $19,143
c.credit to FICA Taxes Payable for $4,131.
d.credit to Payroll Tax Expense for $7,263.
Shambhala Spice Company has experienced a $60,000 loss due to tornado damage to
their inventory. Tornados have never before occurred in this area. Assuming that the
company’s tax rate is 30%, what amount will be reported for this loss on the income
statement?
a.$60,000
b.$42,000
c.$18,000
d.$36,000
The average collection period for receivables is computed by dividing 365 days by
a.net credit sales.
b.average accounts receivable.
c.ending accounts receivable.
d.accounts receivable turnover.
Sampson Company’s accounting records show the following at the year ending on
December 31, 2014.
Using the periodic system, the cost of goods sold is
a.$351,110.
b.$348,910.
c.$340,510.
d.$359,510.
If you are able to earn a 15% rate of return, what amount would you need to invest to
have $6,500 one year from now?
a.$6,435.65
b.$5,687.50
c.$5,525.00
d.$5,652.20
Redeker Company had the following records:
What is Redeker’s inventory turnover for 2013? (rounded)
a.5.6 times
b.5.5 times
c.0.2 times
d.5.3 times
For accounting information to have relevance, it must be
a.consistent.
b.timely.
c.verifiable.
d.understandable.
The accountant at Patton Company has determined that income before income taxes
amounted to $11,000 using the FIFO costing assumption. If the income tax rate is 30%
and the amount of income taxes paid would be $600 greater if the LIFO assumption
were used, what would be the amount of income before taxes under the LIFO
assumption?
a.$11,600
b.$13,000
c.$9,000
d.$10,400
The conceptual framework that underlines IFRS
a.is very similar to that used to develop GAAP.
b.does not define assets or liabilities.
c.does not define equity.
d.does not define income or expenses.
Wolford Company borrowed $1,000,000 from U.S. Bank on January 1, 2013 in order to
expand its mining capabilities. The five-year note required annual payments of
$260,436 and carried an annual interest rate of 9.5%. What is the balance in the notes
payable account at December 31, 2014?
a.$1,000,000
b.$653,412
c.$834,564
d.$810,000
Outstanding stock of the Hall Corporation included 40,000 shares of $5 par common
stock and 20,000 shares of 6%, $10 par non-cumulative preferred stock. In 2013, Hall
declared and paid dividends of $8,000. In 2014, Hall declared and paid dividends of
$24,000. How much of the 2014 dividend was distributed to preferred shareholders?
a.$16,000.
b.$28,000.
c.$12,000.
d.None of these answer choices are correct.
Yanik Corporation issues 4,000, 10-year, 8%, $1,000 bonds dated January 1, 2014, at
97. The journal entry to record the issuance will show a
a.debit to Cash of $4,000,000.
b.debit to Discount on Bonds Payable for $120,000.
c.credit to Bonds Payable for $3,880,000.
d.credit to Cash for $3,880,000.
Which one of the following is not one of the major purposes of the statement of cash
flows?
a.It provides information about the company€s ability to pay dividends.
b.It provides information about the firm’s ability to meet its obligations.
c.It provides information about the firm’s resources and claims against those resources.
d.It provides information about the company€s ability to generate cash flows.
Marvin Services Corporation had the following accounts and balances:
If the balance of the Buildings account was $42,000 and $3,000 of Accounts Payable
were paid in cash, what would be the balance of the total stockholders’ equity?
a.$81,000
b.$72,000
c.$102,000
d.$78,000
An adjusting entry recording accrued salaries for a period indicates that Salaries and
Wages Expense has been ________________ but has not yet been ________________
or recorded.
The management of Morton Company estimates that credit sales for August,
September, October, and November will be $180,000, $200,000, $230,000, and
$160,000, respectively. Experience has shown that collections are made as follows:
Instructions
Determine the collections from customers in October and November. Show all
computations.
Traynham Company runs a retail company and recently completed its third year of
operations. The balance sheet and income statement follow:
Additional Information on Year 2014 Transactions
1)Purchased equipment by paying signing a long-term note for $8,000 and paying cash
for the balance
2) Paid cash as a payment on the long-term notes payable
3) Issued 100 shares of common stock for cash
4)Declared and paid cash dividends of $16,000
Instructions: Prepare a statement of cash flows for 2014 using the indirect method.
S. Lawyer performed legal services for E. Corp. Due to a cash shortage, an agreement
was reached whereby E. Corp. would pay S. Lawyer a legal fee of approximately
$15,000 by issuing 8,000 shares of its common stock (par $1). The stock trades on a
daily basis and the market price of the stock on the day the debt was settled is $1.80 per
share. Given this information, the best journal entry for E. Corp. to record for this
transaction is
Madson Company typically sells subscriptions on an annual basis, and publishes six
times a year. The magazine sells 75,000 subscriptions in January at $10 each. What
entry is made in January to record the sale of the subscriptions?
Reinhardt’s Carpet Cleaning has the following balance sheet items: