The issue price is the price the stock initially sells for the first time it is sold.
A high current ratio indicates that current liabilities are greater than current assets.
A vertical analysis would be used if an analyst wants to see how gross profit of a
company has changed from one year to the next.
Partisan Services purchased 10 delivery vehicles by issuing a 10-year installment note
payable for $320,000. This transaction is shown in the investing activities section of the
statement of cash flows.
The balances in the liability and revenue accounts are increased with a credit.
Swanson, Inc. uses a periodic inventory system. From the following details, calculate
the cost of goods sold.
A) $24,200
B) $19,800
C) $23,700
D) $26,000
Which of the following sequences is the normal sequence of flow of accounting data?
A) Ledger Journal Source document
B) Journal Source document Ledger
C) Source document Journal Ledger
D) Source document Ledger Journal
Paramount Event Planning Services collects fees from its customers in advance. On
January 1, 2017, the balance of its Unearned Revenue account was $3,000 (CR). During
January and February, the company collected $4,000 and $600 as advance fees. During
the two-month period, it performed services of $5,500 related to the deferred revenue.
What is the balance in Unearned Revenue at the end of February?
A) debit balance of $3,000
B) credit balance of $3,000
C) debit balance of $2,100
D) credit balance of $2,100
A business makes a cash payment of $12,000 to a supplier for supplies purchased two
weeks earlier. Which of the following accounts is debited?
A) Cash
B) Accounts Payable
C) Supplies
D) Accounts Receivable
Which of the following entries is necessary to close the appropriate depreciation
account at the end of the year?
A) debit Accumulated Depreciation and credit Income Summary
B) debit Depreciation Expense and credit Income Summary
C) debit Income Summary and credit Accumulated Depreciation
D) debit Income Summary and credit Depreciation Expense
Steel Rolling Corp. purchased a mine, which holds an estimated 38,000 tons of iron ore,
on January 1, 2017, for $538,000. The mine is expected to have zero residual value. The
business extracted and sold 15,500 tons of ore in 2017 and 8,800 tons of ore in 2018.
What is the depletion expense for 2017? (Round any intermediate calculations to two
decimal places, and your final answer to the nearest dollar.)
A) $124,608
B) $219,480
C) $86,608
D) $318,600
Which of the following is a liability account?
A) Accounts Payable
B) Prepaid Expense
C) Salaries Expense
D) Service Revenue
Equipment was acquired for $258,000 and has accumulated depreciation of $194,000.
The business exchanges this equipment for new equipment. The new equipment has a
market value of $202,000 and the business pays $153,000 cash. Assume the exchange
has commercial substance. The exchange results in ________.
A) loss $15,000
B) gain $15,000
C) gain $138,000
D) loss $138,000
National Art is a new business. During its first year of operations, credit sales were
$50,000 and collections were credit sales of $32,000. One account, $625 was written
off. Management uses the percent-of-sales method to account for bad debts expense and
estimates 2% of credit sales to be uncollectible. The ending balance of Allowance for
Bad Debts account is ________.
A) $375
B) $1,000
C) $348
D) $1,628
The interest rate on which cash payments to bondholders are based is the ________.
A) market rate
B) discount rate
C) stated rate
D) amortization rate