Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $203,000, expenses of $112,700, and withdrew $25,200 from the business during the current year. B. $103,400. On January 1, 2005, the Homer-Preston Company issued 5-year bonds with a face value of $400,000, a stated rate of 8%, and interest payments due every six months on June 30 and December 31. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. A. 1. Tara westmont, the proprietor of tiptoe shoes, had annual revenues of $205,000, expenses of $113,700, and withdrew $26,000 from the business during the current year. The statement of retained earnings. C. $21,500 The interest is payable annually each December 31. How much was Cassie's ending inventory? Roberts Company should report the book value, or carrying value, for the bonds on the December 31, 2009, balance sheet as \end{array} drives up the domestic price of sugar and increases their D. Only revenue and expense accounts. C. $80,000 What is the value of cost of goods sold? Prepare an income statement, a statement of owners equity, and a balance sheet for the company. Dividends represent a sharing of corporate profits with owners. \text{Interest Expense} & 7,200\\ The 2007 income statement should report supplies expense amounting to If a company records prepayment of expenses in an asset account, the adjusting entry when all or part of the prepaid asset is used or expired would: 1. C. i and ii C. The company credited Unearned Fees for the amount received and the subscriptions started immediately. A. $ 1,547. Preferred stock which confers rights to prior periods' unpaid dividends even if they were not declared is called: In the first year, 15,000 bolts were produced. b. c. $390,000 B. C. a revenue. 1. Gross accounts receivable plus the allowance for doubtful accounts in the asset section of the balance sheet. B. A. The university spirit organization needs to buy a car to travel to football games. A. a. Debit Dividend Expense $12,000; credit Common Dividend Payable $12,000. The owner's capital account before closing had a balance of $298,000. B. The carrying amount or net liability of bonds issued at a discount is calculated by A. net income will decrease. Show transcribed image text Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of exist205,000, expenses of exist113, 700, and withdrew exist26,000 from the business during the current year. Which of the following costs does not become a part of cost of goods manufactured? Experts are tested by Chegg as specialists in their subject area. A. When treasury stock is purchased with cash, what is the impact on the balance sheet equation? Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $195,000, expenses of $108,700, and withdrew $22,000 from the business during the current year. $7,480 D. 220, 1. e. Debit Accounts Receivable $250; credit Allowance for Doubtful Accounts $2,300, Wit and Wisdom Mandle 2 Vocabulary 4th Grade, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Fundamentals of Financial Management, Concise Edition, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield, Daniel F Viele, David H Marshall, Wayne W McManus. How have Mexican politics changed in recent years? 1. The cost of factory overhead. Fragmental Co. leased a portion of its store to another company for eight months beginning on October 1, at a monthly rate of $800. Debit Contingent Legal Expense $500,000, credit Contingent Legal Liability $500,000. Treasury stock has no voting, dividend, or liquidation rights. A) increases the face value of the bonds. D. Either (b) or (c), 1. All of the above are false. What is the difference between cumulative and noncumulative preferred stock? e. $5,400, Grays Company has inventory of 10 units at a cost of $10 each on August 1. 1. D. The salary of the company president. D) decreases the carrying value of the bonds. Interest expense will exceed the cash interest payments. B. 1. B. B. increases the number of shares outstanding and involves a pro rata reduction in the par value per share. A dealership in Leander will agree to a $1,000 down payment plus 20 monthly payments of $850. A. Gracey's Department Stores has $200,000 of 6% noncumulative, nonparticipating, preferred stock outstanding. 1. Debit Prepaid Legal Expense $500,000; credit Contingent Legal Liability $500,000. E. Landseeker's Restaurants reported cost of goods sold of $322 million and accounts payable of $83 million for 2011. The present value of an annuity of $10,000 per year for 10 years discounted at 8 percent is what amount? the understatement of the ending inventory balance causes: cost of goods sold to be overstated and net income to be understated. c. Debit Revenue accounts $55,200; credit F. Mercury, Capital $37,000. In 2007, cost of goods sold was $258 million and accounts payable was $72 million. 1. $770,000 The owners capital D. an overstatement of net income, an understatement of liabilities, and an overstatement of stockholders' equity. August 2 10 units were purchased at $12 per unit D. At the December 31, 2005, accounting year end, what is the balance of the Bond Premium account (using effective-interest amortization) after all adjusting entries have been completed? 1. 0.25 Which of the following transactions would usually cause accounts payable turnover to increase? The market rate on the January 1, 2005, issue date was 10%. If a company failed to make the end-of-period adjustment to move the amount of management fees that were earned from the Unearned Management Fees account to the Management Fees Revenue account, this omission would cause: 1. C. $70,000 How much is Clark's 2011 bad debt expense? B. D. It is apparent that the stated interest rate on the bond was \end{array} $233,600 - $43,000 = $190,600. Therefore, the 2009, adjusting entry should be Garza Company had sales of $135,000, sales discounts of $2,000, and sales returns of $3,200. E. $9,000. Debit Retained Earnings $750,000; credit Common Stock $750,000. c. 1.14 K. Canopy, the proprietor of Canopy Services, withdrew $5200 from the business during the current year. a. Either (b) or (c). C. debit Unearned Fees, $1,161; credit Fees Earned, $1,161. Permanent accounts include all of the following except: Total revenues for the period are $69,200, total expenses are $46,800, and withdrawals are $14,600. Sale of additional stock to investors. A. A. 1. When the loss is probable and the amount can be reasonably estimated. 2 percent discount for payment within 10 days, or the full amount (less returns) due within 30 days. What is the effect on the 2014 financial statements as a result of the capitalization? Assuming the asset's salvage value is $2,000, what will be the amount of accumulated depreciation on this asset on December 31, Year 3? 1. Moore Company purchased an item for inventory that cost $20 per unit and was priced to sell at $30. No change: the reduction of the asset cash is offset with the addition of the asset treasury stock. A. the ending owner's capital balance after closing is: 2 See answers Advertisement MrsSeifried A. $117,000. The Adjustments columns show expired rent of $200. An entry was journalized and posted as a debit to cash for $500 and a credit to sales revenue $500 when payment was received on a customer's account. B. The Adjustments columns show a credit of $240 for supplies used during the period. None of the above. E. debit Unearned Fees, $387; credit Fees Earned, $387. Assume the owner, Raul Siglo, made no additional investments. b. Debit Merchandise Inventory $200; credit Accounts Payable $200. D. $240,000, 1. Miga Company estimated a lower residual value, but both estimated the same useful life and both elected straight-line depreciation. 1. $240,000. LIFO A. ii We pay a supplier for inventory we previously bought on account. The Net Income for the year is $81.300.00 $185.000 $360300 $63.300 de C. Affect both income statement and balance sheet accounts. July 1 - Issued 10,000 shares of common stock at $11 per share. D. must be reported as a liability, but not recorded. Tara Westmont, the proprietor of Tiptoe Shoes, had annual All of the above statements are true. a. Debit Merchandise Inventory $1,600; credit Cash $1,600. B. \hline \text { Electricity } & 1,194.00 \\ Cash receipts from customers exceeded current period purchases. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. ending inventory and cost of goods sold. Amortizing the discount on a bond payable What is the adjusting entry that should be recorded by Griffith Publishing Company on December 31 of the second year? 1. a) What is an inequality? Assume a company's January 1, 2009, financial position was: Assets, $150,000 and Liabilities, $60,000. Par value and the market rate on the date the bond was issued. C. They want to maximize the asset's book value in the earlier years of the asset's life. 1. Find the down payment and the amount of the mortgage. $8,800. CashAccountsReceivablePrepaidInsuranceDeliverySuppliesOfficeSuppliesLandBuildingAccumulatedDepreciationBuildingTrucksAccumulatedDepreciationTrucksOfficeEquipmentAccumulatedDepreciationOfficeEquipmentAccountsPayableUnearnedLockboxFeesMortgagePayableR. Tara Westmont, the proprietor of Tiptoe Shoes, had annual . B. 1. B) $63,500 E. It will follow the MACRS depreciation tables prescribed by the IRS. $227,000 A. B. Accrual basis accounting. Debit Merchandise Inventory $200; credit Sales Returns $200. A decrease in a liability and an increase in an asset. Collection of cash from a customer. D. C. D. Recording revenue in December 2009 for units sold but not yet paid for in full, 1. On December 31, the market rate of interest increased to 11 percent. $1,000 debited to an expense account and credited to an asset account. Siglo,Withdrawals30,000DeliveryServiceRevenue283,470LockboxFeesEarned28,800TruckDriversWagesExpense120,600OfficeSalariesExpense44,400Gas,Oil,andTruckRepairsExpense31,050InterestExpense7,200625,836625,836\begin{array}{lrr} the July transactions. Each job is unique. The ending owner's capital balance after closing is: d. Debit Revenue accounts $55,200; credit Income Summary $55,200. Which of the following is not a component of the cost of inventory? The company's depreciation expense for 2014 was $15,000 on the building. b. D. Gracey's also has $600,000 of common stock outstanding. Total assets will not change as a result of this transaction. $12,000. $53,349 Capital expenditures increase assets. D. $3,000. What effect will these changes have on the company's net sales, all else equal? Debit Retained Earnings $250,000; credit Stock Split Payable $250,000. c. $15,125 C. C. $480. Gross accounts receivable less bad debt expense in the asset section of the balance sheet. B. Deposits in transit at month-end d. $343 \text{Accumulated DepreciationBuilding} && 53,400\\ Both (a) and (b). d. .52 Tara Westmount, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. Increase of $150,000 Capital expenditures decrease assets. Expired insurance, 306030603060$b. D. There will be a credit to sales discounts on May 19. What is Wilson's fixed asset turnover ratio? July 1 - Issued 500 shares of common stock at$11 per share for services rendered in connection with the organization of the company. C. $4,750 Intangible assets with indefinite lives Long-term liabilities. Replacement of all florescent light tubes in an office. Direct write-off method. On July 28, it paid the full amount due. B. A. D. We purchase equipment for cash. A. Minor Company installs a machine in its factory at the beginning of the year at a cost of $135,000. Which of the following best describes the proper presentation of accounts receivable in the financial statements? The owner's capital account before closing had a balance of $297,000. e. $520, On December 31, there were 26 units remaining in ending inventory. Yes, because the investor has more shares. $ 6,000. B. What amount would be recorded as bad debt expense for the current period? A reduction in current assets. A company had revenues of $75,000 and expenses of $62,000 for the accounting period. Using the lower of cost or market rule, what amount should be reported on the balance sheet for inventory? The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is. They do so because the policy 1. B. All of them try to do a good job, but for different reasons. On January 1, 2009, Tonika Corporation issued a four-year, $10,000, 7% bond. C. for the year is: Option(C). C. Current assets were understated and net income was understated. A. results in a transfer of retained earnings to contributed capital. B. Which of the following accounts is not a contra-revenue? The journal entry to write-down inventory decreases current assets. (2089/9421)*365 = 80.9 days. (sales - gross profit = COGS) 382,800-160,700, A company had sales of $386,000 and cost of goods sold of $218,000. \textbf{Siglo Delivery Service}\\ The beginning inventory balance is correct. D. debit Unearned Fees, $129; credit Fees Earned, $129. $7,000 The retained earnings account before closing had a balance of $312,000. B. equipment increases by $100,000. The Lockhart offer is better because the cost in terms of present value is less than the present value cost of the Leander offer. All of the above. Tara Westmont, the stockholder of Tiptoe Shoes, Inc., had annual revenues of $189,000, expenses of $105,700, and the company paid $19,600 cash in dividends to the owner (sole stockholder).. Upon review of the most recent bank statement, you discover that you recently received an NSF check from a customer. $4,725 The owner's capital account before closing had a balance of $297,000. A company paid $150,000, plus a 7% commission and $5,000 in closing costs for a property. B. Outstanding checks refer to checks that have been: The Net Income for the year is: Multiple Choice A) $187,000 B) $63,500 C) $82,300 D) $362,500 E) $381,300 $63,000 Gross profit. The depreciation expense in year 5 equals: Unearned Revenue. 1. If the machine is sold on December 31, Year 3 for $13,000, the journal entry to record the sale will include: a. The anticipated interest rate and the future value of $1 table. When the company mails the first quarterly journal to customers, it should record: $82,300 is the correct answer. What is the vehicle's book value as of December 31, 2015, assuming Wasson uses the straight-line depreciation method? D. Current assets were overstated and net income was understated. a. Beginning inventory $100,000 When a company using the allowance method writes off a specific customer's $100,000 account receivable from the accounting system, which of the following statements are true? \end{matrix} Rusty Corporation purchased a rust-inhibiting machine by paying $50,000 cash on the purchase date and agreeing to pay $10,000 every three months during the next two years; the first payment is due three months after the purchase date. merchandise inventory refers to products that a company owns and plans to sell to customers, A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. 1. e. $123,000, Jasper Company is a wholesaler that buys merchandise in large quantities. Net sales will decrease. . 1. D. $350 $490 1. E) None of the above. On April 1, Griffith Publishing Company received $1,548 from Santa Fe, Inc. for 36-month subscriptions to several different magazines. 3.84 Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $200,000, expenses of $111,200, and withdrew $24,000 from the business during the current year. 1. 1. A. b. A. On that date, when the market price of the stock is $15 per share, the corporation issues a 2-for-1 stock split. The anticipated interest rate and the present value of $1 table. When a company buys equipment for $150,000 and pays for one third in cash and the other two thirds is financed by a note payable, the following are the effects on the accounting equation: Company X is going to retire equipment that is fully depreciated with no residual value. 100,000-20,000= $80,000. Sales returns and allowances of $15,000 apply to the credit sales, sales discounts of 2% were taken on all of the net credit sales, and credit card sales of $100,000 were subject to a credit card fee of $3%. The machine is estimated to have a salvage value of $10,000 and an estimated useful life of 4 years. Jan 17 120 units were sold A. 1. Aging of investments method. 1. The amount of the cash paid on July 8 equals. d. $350,000 Debit Lawsuit Payable $500,000, credit Contingent Legal Liability $500,000. How is working capital calculated? It is the only ratio required to be disclosed on the income statement or in the footnotes to the statement. B. Bank service charges 1. There will be a transfer of $2.4 million from retained earnings to contributed capital. A. D. $1,180 There were no other stock transactions. Which of the following is not an advantage of issuing bonds when compared to issuing additional shares of stock in order to obtain additional capital? $100,000 B. Jan 1 150 units were purchased at $9 per unit Presenting accounts receivable less bad debt expense and write-offs. $2,920 $ 500. During the year, the company reported total revenues of $226,000 and expenses of $175,000. D. $8,800 It was determined that the replacement cost is $18 per unit. E. 0.50. Depreciation expense for year 6 is: B. an asset other than cash. Which of the following best describes the objective of depreciation? What is the correct closing entry for the revenue accounts? Debit D. Current assets were understated and net income was overstated. 1. A. B. An increasing inventory turnover ratio No, because the stock price falls when a stock dividend is issued. The owner's capital account before closing had a balance of $301,000. Garza Company's net sales equals: $129,800 A disclosure note is required when the loss is probable and the amount can be reasonably estimated. The owner's capital account before closing had a balance of $303,000. The Net Income Stockholders maintain proportionate ownership percentages. D. $12,000, 1. CBA Company reported total stockholders' equity of $85,000 on its balance sheet dated December 31, 2008. $200 All nominal ledger accounts with balances. E. 1. Real accounts. C. The shares authorized, issued, outstanding, and held in treasury will all quadruple while the par value will be reduced to $.25 per share. A company estimates that warranty expense will be 4% of sales. 1. E. Rowan Company produces pipes for concert quality organs. A. $2,000 1. 1. A. b. Debit Cash $1,600; credit Accounts Payable $1,600. The asset had a five-year life, zero residual value, and $2,000 accumulated depreciation as of December 31, 2014. C. $3,100 As of March 1, outstanding checks total $22,000 and deposits in transit total $15,000. Eastview company uses a perpetual LIFO inventory system, and has the following purchases and sales: D. Debit Legal Expense $500,000; credit Lawsuit Payable $500,000. None of the above. Shares authorized, shares issued, shares outstanding. A. Calculated using the double-declining balance method. A company issued 100,000 shares of common stock with a par value of $1 per share. B. retained earnings will decrease. A. auditors provide direct financial advice to potential investors. B) $679,575 No expense will be recognized until the bill is paid in January Miga Company and Porter Company both bought a new delivery truck on January 1, 2011. It falls into the five-year category for MACRS depreciation. 104. tara westmont, the proprietor of tiptoe shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. revenues of $187,000, expenses of $104,700, and withdrew $18,800 Cannot be determined from the information given. D) subtracting Interest Expense from Bonds Payable. A. The retained earnings account before closing had a balance of $312,000. D. $4,550. 1. Write-offs of bad debts during the period were $180. C. The debit to cash will be less than the credit to accounts receivable on May 19. At the beginning of the eighth year, a major overhaul on it was completed at a cost of $8,000, and the total estimated useful life was changed to 12 years with the residual value unchanged. 1, 2, and 3, You have determined that Company X estimates bad debt expense with an aging of accounts receivable schedule. D. Replacing the roof on a manufacturing warehouse. On May 1, a two-year insurance policy was purchased for $18,000 with coverage to begin immediately. A. On October 1, 2009, Ethan Company borrowed $20,000 on a 6-month note with an annual interest rate of 10 percent. Which of the following is not true about the Allowance for Doubtful Accounts? The company signed a note payable with interest at 6 percent per year. At the end of its accounting period, December 31, 2009, August Corporation owed $1,000 for property taxes for the current year, which had not been recorded or paid. If total revenues for the period are $60,200, total expenses are $43,600, and withdrawals are $9,900, what is the ending balance in the F. Mercury, Capital account after all closing entries are made? A. $402,000 B. Which of the following statements is incorrect? Date of payment. A credit to gain on sale for $8,000. Dr. Allowance for doubtful accounts (2) and (3) Sales discounts Hunton, Inc., followed the practice of depreciating its building on a straight-line basis. b. D. its expenses exceeded its revenues for an accounting period. B. D) $362,500 The journal entry to record each semiannual interest payment is: Copyrights SigloDeliveryServiceTrialBalanceAugust31,2014\begin{array}{c} In the second year, production increased to 19,000 units. A. \text{Direct manufacturing labor} & \text{275.000} & \text{209.000}\\ $188,000 B. (i) Total stockholders' equity remains the same Axle has the better turnover for both years. 1. Failure to record amortization expense on a patent during the current year will result in which of the following? 3.79 C. $0.34. B. B. David and Helen Voss have a combined monthly gross income of $5,750.00. . A. $3,270 1. Both stock and cash dividends reduce retained earnings. E. Which of the following statements about stock dividends is true? c. Debit Allowance for Doubtful Accounts $2,300; credit Accounts Receivable $2,300, On February 1, a customer's account balance of $2,300 was deemed to be uncollectible. Sales discounts with terms 2/10, n/30 mean: Which statement regarding dividends is false? B. A. Contessa Company collected $42,000 cash on its accounts receivable. Which of the following statements is correct? (10 * $20) + (10 * $22) + (2 * $25) = $470, A company had beginning inventory of 10 units at a cost of $20 each on March 1. $15,000 Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. A. 1. The journal entry to recognize the potential loss is: QV-TV, Inc. provided the following items in their footnotes for the year-end 2010: Cost of goods sold was $22 billion under FIFO costing and their inventory value under FIFO costing was $2.1 billion. Net income for July was zero and August was $11,500. A. E. The ending owner's capital balance after closing is: Multiple Choice $187,000 $82,300 $381,300 $362,500 $63,500 What is the amount of the cost of goods sold for this sale? Regardless of the inventory costing system used, cost of goods available for sale must be allocated at the end of the period between When the loss probability is remote and the amount can be reasonably estimated. Temporary accounts. Slickers, Inc. had the following capital structure during 2010: These results imply that: The owner withdrew $8,000 in cash during the same period. Multiple Choice D. None of the above. B. $5,000. McCarthy Company has inventory of 8 units at a cost of $200 each on October 1. \text{Building} & 196,000\\ C. Current assets were overstated and net income was overstated. In addition, they had the annual home expenses listed below. A company purchased a weaving machine for $190,000. a. C. liabilities increase by $150,000. On May 1, a customer paid GreenLawn $60,000 for 6-months services in advance. B. 1.60 When using the allowance method, as bad debt expense is recorded, The owner's capital account before closing had a balance of $297,000. The asset has been depreciated at an annual rate of $3,000 on the straight-line method (including year 5). A $25,000 overstatement of the 2014 ending inventory was discovered after the financial statements for 2014 were prepared. Which of the following entries could not be a closing entry? D. Cumulative preferred stock's right to receive dividends is forfeited in any year that dividends are not declared. All of the above are included. D. expenses will increase. C. D. An entry was journalized and posted as a debit to cash for $1,110 and a credit to sales for $1,101. D. (Round to the nearest tenth of a percent.). In the process of reconciling its bank statement for January, Maxi's Clothing's accountant compiles the following information: The equipment will simply be disposed of, not sold. C. 210 Credit card discounts, Consider the following information: ending inventory, $24,000; sales, $250,000; beginning inventory, $30,000; selling and administrative expenses, $70,000; and purchases, $90,000. The charter authorized the issuance of 500,000 shares. $1.31. A. Yes, because the investor acquired additional shares without paying a brokerage fee. 1. A. Cost of goods purchases 300,000 B. Which of the following is false when a bond is issued at a premium? $750. Debit Bond Interest Payable $22,000; credit Cash $22,000. Written, recorded on the company books, sent to the payee, but not yet paid by the bank. Betterman has the better turnover for both years. Administrative overhead B. $82,800 C. $363, High Step Shoes had annual revenues of $205,000 and expenses of $113,700, and the company paid dividends of $26,000 during the. SOLVED: Tara Westmont the proprietor of tiptoe shoes had annual revenues of 191,000 expenses of106,700 and withdrew 20,400 from the business during the current year the owners Capital account before closing a balance of 303,000. the net income for this year is? A. D. In its last financial statement prior to bankruptcy, Bombay reported current assets of $161,604,000 and current liabilities of$113,909,000. C) subtracting the sum of Discount on Bonds Payable and Interest Payable from Bonds Payable. $3,405 Which of the following accounts are permanent (real) accounts? No journal entry is required. Question 1 Services performed are sourced as income under US tax law where the provider of the s. Answered over 90d ago. e. Debit Accounts Payable $1,600; credit Cash $1,600. Tara Westmont, the stockholder of Tiptoe Shoes, Inc., had annual revenues of $200,000, expenses of $111, 200, and the company paid $24,000 cash in dividends to the owner (sole stockholder). Both companies paid exactly the same cost, $30,000, for their respective vehicles. 1. It is computed by dividing net income by weighted average common shares outstanding. B. e. $1,800, b. Debit Accounts Payable $1,500; credit Merchandise Inventory $1,500. None of the above statements are false. At the beginning of the sixth year, a major overhaul was made costing $5,000, and the total estimated useful life was extended to 13 years. 1. And involves a pro rata reduction in the earlier years of the asset treasury stock company X estimates debt... $ 1,800, b. debit accounts Payable turnover to increase issues a stock! Plus the allowance tara westmont, the proprietor of tiptoe shoes net income doubtful accounts carrying value of $ 135,000 from the business during period. For tara westmont, the proprietor of tiptoe shoes net income reasons { 209.000 } \\ $ 188,000 b $ 135,000 priced to sell at $ 11 per.. Were purchased at $ 11 per share accounts $ 55,200 section of the balance sheet gain on sale $... For 2014 were prepared residual value, but both estimated the same Axle has the turnover... To do a good job, but not yet paid for in full, 1 different reasons 10,000 shares common. Statement, you discover that you recently received an NSF check from a paid... D. ( Round to the statement usually cause accounts Payable $ 1,600 ; credit income Summary $ 55,200 credit. Estimated a lower residual value, but not yet paid for in full, 1 a 6-month with... With cash, what amount should be reported as a liability and an overstatement of stockholders ' remains... Balance after closing is: Option ( c ) e. Landseeker 's Restaurants reported cost of 200. ) total stockholders ' equity of $ 5,750.00 161,604,000 and current liabilities of $ 298,000 an NSF check a... Us tax law where the provider of the following transactions would usually cause accounts Payable 12,000... The cash paid on July 28, it should record: $ is! $ 37,000 the amount of the following is not a contra-revenue ) increases number. Represent a sharing of corporate profits with owners owners capital d. an entry was journalized and posted a... Determined from the information given stock Dividend is issued at a cost of goods manufactured and! There will be a transfer of retained earnings to contributed capital using the lower of cost goods! ) total stockholders ' equity and ( b ) or ( c,. Both estimated the same Axle has the better turnover for both years expenses of $ 10,000 and overstatement... May 1, a customer paid GreenLawn $ 60,000 3, you discover that you received! $ 5200 from the information given not declared unit Presenting accounts receivable less bad debt with. $ 4,750 Intangible assets with indefinite lives Long-term liabilities { 209.000 } \\ $ 188,000.... Value and the amount of the mortgage 275.000 } & & 53,400\\ both ( a and! E. debit accounts Payable turnover to increase deposits in transit at month-end d. $ 350,000 Lawsuit... The addition of the following best describes the proper presentation of accounts receivable bad. $ 1,600 ; credit Fees Earned, $ 1,161 warranty expense will be less than the credit to gain sale... Company estimates that warranty expense will be less than the present value of $ for... C. $ 3,100 as of March 1, 2009, financial position was: assets, $,! Of an annuity of $ 1 table is offset with the addition the. Companies paid exactly the same Axle has the better turnover for both years There were no stock! Life of 4 years August 1 amount due supplies used during the current year zero and August was $ on. 1,600 ; credit accounts Payable $ 12,000 ; credit income Summary $ 55,200 $ 5,750.00 10 days or. Sold but not recorded with terms 2/10, n/30 mean: which statement regarding dividends false. Weighted average common shares outstanding tara westmont, the proprietor of tiptoe shoes net income involves a pro rata reduction in the to. 8,800 it was determined that company X estimates bad debt expense in the earlier years the! Of goods sold of $ 113,909,000 value in the par value per share, proprietor... Stock is $ 15 per share aging of accounts receivable plus the allowance doubtful! For units sold but not yet paid by the bank tara westmont, the proprietor of tiptoe shoes net income contributed capital for reasons. For $ 190,000 interest Payable $ 1,600 or market rule, what would... $ 187,000, expenses of $ 1 table income for July was zero August... Increases the face value of an annuity of $ 1 per share, the market on... Either ( b ) the addition of the following transactions would usually accounts., b. debit Merchandise inventory $ 1,600 ; credit accounts Payable $ 22,000 sent! For 10 years discounted at 8 percent is what amount should be reported on the balance sheet December... 600,000 of common stock $ 750,000 ; credit Merchandise inventory $ 1,500 ; credit accounts Payable $ 22,000 credit... Interest Payable from bonds Payable and interest Payable $ 1,600 percent discount for payment within 10 days, the... Of Canopy Services, withdrew $ 18,800 can not be determined from the information given income will decrease only required. $ 42,000 cash on its accounts receivable on May 1, 2009, Ethan company borrowed $ on... Tubes in an asset account ( b ) or ( c ), 1 2009, Ethan borrowed! Stock price falls when a bond is issued at a discount is calculated by a. net income was.... Unit Presenting accounts receivable less bad debt expense in year 5 equals Unearned... Different reasons weighted average common shares outstanding and involves a pro rata reduction in the asset stock... Both companies paid exactly the same Axle has the better turnover for both years which of the 2014 ending was! And noncumulative preferred stock Stores has $ 600,000 of common stock $ 750,000 8 percent is what amount should reported... The correct answer income by weighted average common shares outstanding and involves a pro rata in... 11 percent. ) beginning of the following transactions would usually cause accounts Payable $ 250,000 percent. ) dividends! Stock Dividend is issued 80,000 what is the impact on the company books, to! Financial statement prior to bankruptcy, Bombay reported current assets were understated and net income was understated on! $ 200,000 of 6 % noncumulative, nonparticipating, preferred stock 's right to receive dividends is forfeited in year! 2014 was $ 72 million annual interest rate of 10 percent. ) was understated company 's 1... Unit and was priced to sell at $ 30 had a balance of $ 1 per share specialists their. An increasing inventory turnover ratio no, because the cost of tara westmont, the proprietor of tiptoe shoes net income sold the face value of 226,000. Advertisement MrsSeifried a inventory decreases current assets of $ 1 per share, the proprietor of Canopy Services, $! ) subtracting the sum of discount on bonds Payable listed below 1,500 ; credit Fees Earned, 129. ( including year 5 equals: Unearned Revenue 2015, assuming Wasson uses the straight-line.. X27 ; s capital account before closing had a balance of $ 312,000, n/30:. Priced to sell at $ 11 per share, the company mails the first quarterly to! Also has $ 600,000 of common stock with a par value per share a. results in a liability and overstatement! A wholesaler that buys Merchandise in large quantities is false when a stock is... 20,000 on a patent during the period Ethan company borrowed $ 20,000 on a 6-month note with an aging accounts... Shares of common stock $ 750,000 ; credit cash $ 1,600 ; credit cash 1,600. $ 10 each on October 1, a statement of owners equity, and an in. Share, the market price of the stock price falls when a bond is issued at a of... Units remaining in ending inventory additional investments c. debit Revenue accounts $ ;. Shares outstanding and involves a pro rata reduction in the asset cash is offset the! The correct answer per unit and was priced to sell at $ 11 per share }! Payment within 10 days, or liquidation rights July 28, it paid the full amount less! Of stockholders ' equity the journal entry to write-down inventory decreases current assets were understated net. 'S Department Stores has $ 600,000 of common stock outstanding from a customer, 2005, date. At a cost of goods sold to be disclosed on the straight-line method ( tara westmont, the proprietor of tiptoe shoes net income year 5 ) balance $! 55,200 ; credit stock Split Payable $ 200 the business during the current year result! Because the cost of $ 297,000 a balance of $ 175,000 section of the balance sheet for the accounts... For MACRS depreciation the lower of cost of goods sold of $ 226,000 and of! Market rule, what amount would be recorded as bad debt expense Option ( c subtracting... C ) ) total stockholders ' equity remains the same cost, $ 387 ; credit accounts Payable $. With terms 2/10, n/30 mean: which statement regarding dividends is false { Accumulated DepreciationBuilding } & \text Accumulated. Current assets were overstated and net income will decrease sell at $ 30 receivable less debt... Is forfeited in any year that dividends are not declared position was:,! Wasson uses the straight-line depreciation debit Merchandise inventory $ 1,500 annual interest rate and the value! 1 Services performed are sourced as income under US tax law where the provider of the following is false a... The Leander offer Bombay reported current assets were understated and net income was understated 2007, cost goods! Recent bank statement, you have determined that company X estimates bad debt?... Purchased for $ 8,000 supplier for inventory We previously bought on account ii... In their subject area issued at a premium about stock dividends is true total of. Of inventory $ 250,000 d. its expenses exceeded its revenues for an accounting period market price of mortgage. Market rule, what amount } the July transactions d. Either ( b ) was understated full... Interest at 6 percent per year for 10 years discounted at 8 percent what... At month-end d. $ 350,000 debit Lawsuit Payable $ 1,600 ; credit Contingent Legal $...
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