Grand Strand Power & Light provides utilities to a gulf coast community. On
November 30, 2012, the utility billed 1,500 residential customers a total of $118,500 for
electricity. In addition, the company is required to collect state taxes of 1.5% and
Federal excise taxes of 0.95%. Both of these taxes are used to fund the energy
commission. A) What total amount should be billed to customers for November 2012?
B) Provide the journal entry to record the November billings.
C) Record the remittance of the taxes to the appropriate governmental units on
December 31, 2012.
Collective term for procedures put into place to ensure that employees operate within
the scope of their assigned responsibilities and act for the good of the business
Match the following terms with their correct definitions.
a. Accounting system e. Internal control system
b. Business process risks f. Safeguarding
c. Control activities g. Segregation of duties
d. Control environment h. Strategic risks
Which of the following accounts would not appear on the balance sheet of a lessee
company recording a capital lease?
a. accumulated depreciation on the leased asset
b. capital lease liability in the current liability section
c. capital leases liability in the long-term liability section
d. rent expense on the income statement
A current liability is defined as a commitment or obligation which requires a company
to transfer assets, create a new current liability, or provide services to another entity at
some point in the future that must occur
a. within one year.
b. within one year or within the operating cycle, whichever is shorter.
c. within one year or within the operating cycle, whichever is longer.
d. by the end of the operating cycle.
A corporation reported the following amounts on its balance sheet at December 1, 2015:
During December of 2015, the following transactions occurred:
A) What journal entries are required to record these stock transactions?
B) How many preferred shares are outstanding at December 31, 2015?
C) How many common shares are outstanding at December 31, 2015?
D) What effect did the stock dividend have on the par value of the preferred stock?
E) What effect did the stock split have on the par value of the common stock?
On December 15, 2013, the accounts receivable balance was $50,000 and the balance in
the allowance for doubtful accounts was $5,000. That morning, a $1,000 uncollected
account was written-off. The net realizable value of accounts receivable immediately
after the write-off is:
a. $49,000
b. $46,000
c. $45,000
d. $44,000
Which organization has the power to set accounting rules for companies whose stock is
publicly-traded in the U.S. stock markets, but has delegated its power to another
organization?
a. International Accounting Standards Board (IASB)
b. Financial Accounting Standards Board (FASB)
c. General Association of Accounting Practitioners (GAAP)
d. Securities Exchange Commission (SEC)
This method is the best for management bonus plans. Given the following list of
methods of depreciation, select the method that is best for the situation or purpose
given. (Choices may be used more than once.)
a. Straight-line
b. Units-of-production
c. Double-declining-balance
d. MACRS
On January 1, 2013, a company issued $5,000,000 of a 10-year, zero-coupon bonds at
55. Required: A) Record the issuance of the bonds on January 1, 2013.
B) Record interest expense for 2013 assuming the use of the straight line amortization
method.
C) Record the retirement of the bonds on January 1, 2023.
Which of the following procedures is not part of the preparation of a bank
reconciliation for a checking account?
a. Comparing deposits listed on the bank statement to the cash account to identify
deposits in transit
b. Comparing canceled checks returned with the bank statement to the cash account to
identify outstanding checks
c. Looking for bank services charges and other items on the bank statement that have
not yet been included in the cash account.
d. Reversing all the transactions recorded on the company’s records that do not yet
appear on the bank statement.
____________ costs are expenditures incurred in the discovery of new knowledge and
the translation of research into a design or plan for a new product.
In ____________________ analysis, each financial statement line item is expressed as
a percent of a base year, which is typically the earliest year shown.
Refer to Rhodes Bakery. Calculate the following stockholder ratios for 2015 and 2014:
Earnings per Share, Return on Common Equity, Dividend Yield, Dividend Payout, Total
Payout, and Stock Repurchase Payout Ratios. Round your answers to two decimal
places, then comment on the company’s stockholder performance. Rhodes Bakery
The balance sheet taken from the company’s 2015 10-K is provided below:
Additional information is available below:
The company had no preferred stock throughout the period 2013 through 2015. At
December 31, 2013, total stockholders’ equity was $287,500.
List several employee withholdings that impact an employee’s net pay. Describe the
types of payroll taxes that an employer might be required to pay.
The current ratio is useful in determining a company’s ability to pay obligations when
they become due.
An increase in retained earnings indicates that a cash dividend has been paid.
In the stockholders’ equity section of a classified balance sheet, a distinction is made
between amounts invested by owners and amounts financed by creditors.