Its acid-test ratio equals: 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. On August 3, it purchased 20 units at $12 each. Failure to record amortization expense on a patent during the current year will result in which of the following? B. beginning inventory and cost of goods sold. Accrued but unpaid truck drivers wages at the end of the year, $1,920. A. decrease stockholders' equity, $75,000; decrease assets, $75,000. Current ratio is calculated by dividing current assets by current liabilities. A. 1. B. A. Schager Company purchased a computer system on January 1, 2014, at a cash cost of $25,000. $ 500. What amount should be reported on December 31 as the bond liability? The stated rate of interest was 8 percent and the market rate of interest was 10 percent when the bond was sold. Refer to Exercise 16.52. $1.99. A company has 4 million common shares authorized, 2.5 million shares issued and 100,000 treasury shares. c. Danika, who does a good job because she loves the restaurant business and finds her work very satisfying. D. The company's sales for the current period are $185,000. for the year is: Option(C). C. D. $73,255. The owner's capital account before closing had a balance of $307,000. It is used instead of reducing accounts receivable directly. a. Debit Merchandise Inventory $1,600; credit Cash $1,600. C. Unearned Revenue. Par value and the coupon rate on the date the bond was issued. 1. e. Debit Accounts Payable $1,600; credit Cash $1,600. $229,800 Using the FIFO perpetual inventory method, what was the cost of the 22 units sold? \text{Direct materials} & \text{\$ 75.000} & \text{\$ 56.000}\\ D. What was the original cost of the building? It will select the lowest residual values for its assets. A. Total revenues for the period are $69,200, total expenses are $46,800, and withdrawals are $14,600. August 29 12 units were sold C. d. $130 What should be the allocation of this property's costs in the company's accounting records? $1,800 c. Debit Revenue accounts $55,200; credit F. Mercury, Capital $37,000. B. does not need to be recorded or reported as a liability. A. debit Unearned Fees, $1,548; credit Fees Earned, $1,548. Interest is paid annually. On July 28, it paid the full amount due. It indicates the portion of earnings distributed to the owners as an immediate return on their investment. Juniper Company uses a perpetual inventory system and the gross method of accounting for purchases. If a check that was outstanding on last period's bank reconciliation was not among the cancelled checks returned by the bank this period, in preparing this period's reconciliation, the amount of this check should be: Using the FIFO perpetual inventory method, what is the value of inventory after the October 4 sale? Coupon rate and the stated rate on the date the bond was issued. Capital expenditures increase assets. C. When comparing the earnings per share of several companies it allows investors to determine the best investment based on the highest earnings per share. The ending owner's capital balance after closing is: __ $186,000 __ $63,400 __ $81,800 __ $361,400 __ $379,800 $3,625 Debit Merchandise Inventory $200; credit Accounts Payable $200. $ 883. C. The debit to cash will be less than the credit to accounts receivable on May 19. What is the difference between cumulative and noncumulative preferred stock? Debit Merchandise Inventory $200; credit Sales Returns $200. Williams Company purchased a machine costing $25,000 and is depreciating it over a 10-year estimated useful life with a residual value of $3,000. Depletion is: 3.89. Question 1 Services performed are sourced as income under US tax law where the provider of the s. Answered over 90d ago. \hline \text { Water Heater Replacement } & 590.34 \\ Page 420 An increase in the expenses of the current period. d. Debit Accounts Payable $1,800; credit Cash $1,800. 1. Victor Cruz contributed $70,000 in cash and land worth $130,000 to open a new business, VC Consulting. What is Wilson's fixed asset turnover ratio? Current liabilities to be recognized as revenue in a future period. \text{Delivery Supplies} & 14,700\\ A. $124 Manufacturing overhead costs are allocated at a budgeted rate of$22 per direct manufacturing labor-hour. The allowance for doubtful accounts balance on January 1, 2011 was $15,000. The owner's capital account before closing had a balance of $314,000. A. C. Ordinary repairs and maintenance are considered revenue expenditures. C. The shares authorized, issued, outstanding, and held in treasury will all quadruple while the par value will be reduced to $.25 per share. Which of the following entries could not be a closing entry? $3,500 New tires for a truck. None of the above. A) is a rare occurrence. D. C. $200 difference between the debit and credit columns of the Unadjusted Trial Balance. $1,000 debited to an expense account and credited to an asset account. The Lockhart offer is better because the monthly payments are less. Assuming no other changes to owner's capital, the balance in the owner's capital account at the end of the year would be: When the bond was issued the market rate of interest was 10 percent. B. a decrease in liabilities and increase in stockholders' equity. 1. It falls into the five-year category for MACRS depreciation. Indicates a longer time span between the purchase and sale of inventory. Current assets. The market rate on the January 1, 2005, issue date was 10%. On July 12, it paid the full amount due. Fragmental Co. leased a portion of its store to another company for eight months beginning on October 1, at a monthly rate of $800. c. The collective-action problem. drives up the domestic price of sugar and increases their Debit Merchandise Inventory $1,600; credit Cash $1,600. Preferred shareholders have a preference with respect to dividend payments. The owner's capital account before closing had a balance of $297,000. D. Assets decrease and stockholders' equity decreases. b. $1,090 D. $8,800 A. It will follow the MACRS depreciation tables prescribed by the IRS. How much interest does the company owe at the end of three months? d. $10,300 AccumulatedDepreciationOfficeEquipment, Don Herrmann, J. David Spiceland, Wayne Thomas, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Daniel F Viele, David H Marshall, Wayne W McManus. E. Balance sheet accounts. They both receive dividends in arrears. E. $$, c. A debit to a prepaid expense and a credit to Cash for $7,500. Assume a company's January 1, 2009, financial position was: Assets, $150,000 and Liabilities, $60,000. d. $343 C. $0.34. Marlow Company purchased a point of sale system on January 1 for $3,400. If the beginning balance in prepaid insurance was $500 and $2,500 was paid for an insurance premium during the year, the ending balance in the prepaid insurance account (after the above adjusting entry) would be C. Debit Cash $7,000; credit Paid-in Capital in Excess of Par Value, Common Stock $6,000, credit Common Stock $1,000. B. C. Rate answer . c. Debit Allowance for Doubtful Accounts $2,300; credit Accounts Receivable $2,300 Jan 1 150 units were purchased at $9 per unit On the second interest payment date of December 31, 2005, what is the amount of the interest expense under the effective interest amortization method (rounded to the nearest whole dollar)? $144,400. e. $200,000, Cushman Company had $800,000 in sales, sales discounts of $12,000, sales returns and allowances of $18,000, cost of goods sold of $380,000, and $275,000 in operating expenses. C. decrease stockholders' equity, $100,000; decrease liabilities, $3,000; and decrease assets, $103,000. b. Rent-seeking behavior. b. & \underline{\underline{625,836}} & \underline{\underline{625,836}}\\ An NSF check returned on a customer account \textbf{August 31, 2014}\\ 1. Discuss how the transaction below impact the accounting equation. A. The ending owner's capital balance after closing is: $379,000 To allocate the cost of a tangible asset to the periods in which its use contributes to earning revenue. 1. $2,875. Calculated using the double-declining balance method. B. 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? (1800-200). All of the above are advantages associated with bonds. Download the file 'breeds.py'; it contains a list of lists named 'breeds'. D. Preferred stock typically has a fixed dividend rate. B. $227,000 B. What was Landseeker's accounts payable turnover ratio in 2011? 1. E. The anticipated interest rate and the future value table for annuities. The weighted-average common shares outstanding were 80,000. \text{Trucks} & 103,800\\ For beginning stockholders equity, use the balance after 1. D. A company issued 8%, 15-year bonds with a par value of $550,000 that pay interest semi-annually. 1. Net income. A contingent liability that is "reasonably possible" but "cannot reasonably be estimated" At the same time, a credit card company reduced the credit card discount from 3% to 2%. Axle has the better turnover for both years. D. an increase in stockholders' equity and increase in an asset. B. Sales discounts 1. Gracey's also has $600,000 of common stock outstanding. No entry is made for this transaction. 1. 2003-2023 Chegg Inc. All rights reserved. $ 700 debit. C. A. B. $490 D. decrease stockholders' equity, $100,000; decrease assets, $75,000; increase liabilities, $25,000. $100,000 plus the interest to be paid over the five-year period in the Long-Term Liability section. Debit Common Stock $6,000, debit Investment in Common Stock $1,000; credit Cash $7,000. What is the net impact on retained earnings? A company is facing a class-action lawsuit in the upcoming year. The adjusting entry for the year ended December 31 would include: 1. Company X is going to retire equipment that is fully depreciated with no residual value. B. Debit Common Dividend Payable $12,000; credit Cash $12,000. Loss of $1,500 The owner's capital account before closing had a balance of $297,000. $8,000 The owner's capital account before closing had a balance of $297,000. D. i, ii, and iii. What entry should be recorded on February 1 to record the write-off assuming the company uses the allowance method? 1. (2089/9421)*365 = 80.9 days. D. $4,550. 1. The selling price of the bonds was $5,679,575. On March 2, it purchased 10 units at $22 each. How much needs to be invested today if your goal is to have $100,000 five years from today? Units-of-production method Can the work sheet be used as a substitute for the financial statements? B. B. Niensted is . C. Total assets remain the same. \hline \text { New Fumace/AC } & 6,458.90 \\ The note and interest are due on December 31, 2009. D. The owners capital D. Net income and assets will both be understated. E. $25 Debit Estimated Warranty Liability $7,400; credit Warranty Expense $7,400 \hline \text { Window Repairs } & 580.10 \\ B. $6,000 preferred; $24,000 common. All of the above. 1. Betterman's turnover is improving. $520 Debit Retained Earnings $250,000; credit Common Stock $250,000. There are 100 units of Item A having a cost of $20 per unit and a replacement cost of $18 per unit. Experts are tested by Chegg as specialists in their subject area. The statement of retained earnings. D. is less able to pay off their current obligations with their current assets. C. An entry was journalized and posted as a debit to cash for $500 and credit to accounts receivable for $5,000. b. D. Franchises, 1. $61,390. It was determined that the replacement cost is $18 per unit. What journal entry would be needed to record the machines' first year depreciation under the units-of-production method? Betterman is collecting its receivables more quickly than Axle in both years. A. Calculate dividend yield, price/earnings ratio, and return on equity. A. Garza Company's net sales equals: $129,800 profits. e. $13,750. C. The 2007 income statement should report supplies expense amounting to 1. \text{Accumulated DepreciationOffice Equipment} && 10,800\\ A. decrease assets, $103,000; decrease liabilities, $103,000. Which of the following best describes accrued liabilities? A. cash decreases by $50,000. Homework Answers 139 Views $3.2 million Purchase $2,000 of office supplies on credit. d. A debit to loss on sale for $3,042. The entry to close the withdrawals account at the end of the year is: 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. C. Preferred shareholders have voting rights on a per share basis. McCarthy Company has inventory of 8 units at a cost of $200 each on October 1. The stock sold for $20 per share. C. 1. Both companies elected straight-line depreciation, but Miga Company used a longer estimated life. C. $66,667 Unearned Revenue. Assets decrease and stockholders' equity increases. Total assets decrease and stockholders' equity decreases. A. 100,000-20,000= $80,000. e. Debit Accounts Payable $1,500; credit Purchase Returns $1,500. When would the lawsuit be recorded as a liability on the balance sheet? A. Gross accounts receivable less bad debt expense in the asset section of the balance sheet. At the beginning of the year, Sigma Company's balance sheet reported Total Assets of $195,000 and Total Liabilities of $75,000. 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. d. The special-interest effect. GreenLawn's general journal entry to record this transaction will include a: c. Debit Cash $70,000; Debit Land $130,000; Credit Cruz, Capital, $200,000. $3,270 $500,000 after revenue and expense accounts have been closed, is: Debit T. Westmont, Capital exist317,000: credit Income Summary exist317,000 . E. On December 1, Simpson Marketing Company received $3,600 from a customer for a marketing plan to be completed January 31 of the following year. 1. 1. E. Which of the following is not true about the Allowance for Doubtful Accounts? Cost of goods sold: July 2 - Issued 1,000 shares of preferred stock at par value for cash. On May 1, a two-year insurance policy was purchased for $18,000 with coverage to begin immediately. Current assets were overstated and net income was understated. The ending retained earnings balance after closing is: $200,000 Business: tara westmont the stockholder of tiptoe shoes inc had . Debit Prepaid Legal Expense $500,000; credit Contingent Legal Liability $500,000. $49,157 E. c. $1,568 Which of the following direct effects on the accounting equation is not possible as a result of transactional analysis? D) $645,596 C. CBA Company reported total stockholders' equity of $85,000 on its balance sheet dated December 31, 2008. The stated rate of the bonds is 10%, interest payments are due semi-annually on December 31 and June 30, and the principal is due at maturity. from the business during the current year. B. A machine costing $75,000 is purchased on September 1, Year 1. D. Miga Company estimated a lower residual value, but both estimated the same useful life and both elected straight-line depreciation. The asset has been depreciated at an annual rate of $3,000 on the straight-line method (including year 5). Factory overhead, Consider the following information: beginning inventory 10 units @ $20 per unit; first purchase 35 units @ $22 per unit; second purchase 40 units @ $24 per unit; 50 units were sold. C. The owner withdrew $37,800 during the year. The owner's capital. Goodwill is not reported unless purchased in an exchange. A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. 6.1051 The owner's capital account before closing had a balance of $312,000. All of the above. Purchase of merchandise on credit. Cash payments to suppliers were less than current period purchases. Which statement regarding dividends is false? The machine's useful life is estimated to be 5 years, or 300,000 units of product, with a $15,000 salvage value. C. $104,000. 1. Q. It will select the shortest lives possible for its assets. $10,000 1. What is the effect on the 2014 financial statements as a result of the capitalization? D. C. is accounted for in exactly the same manner as a stock split. 11 units are sold on October 4. A) subtracting Discount on Bonds Payable from Bonds Payable. B. C. 2/10ths of a percent discount for payment within 30 days A. What is the correct closing entry for the expense accounts? The Net Income for the year is: A. E. Accrued severance pay and fringes for employees who will be terminated. $2,200 D. $4,055 Current ratio helps to assess a company's ability to pay its debts in the near future. The F. Mercury, Capital account has a credit balance of $42,000 before closing entries are made. D. It is created as a result of the adjusting entry to record bad debt expense. Assume the owner, Raul Siglo, made no additional investments. Debit Retained Earnings $750,000; credit Common Stock $750,000. Marquls Company uses weighted average perpetual inventory system and has the following purchases and sales: $2,200 C. Carpet cleaning and repair. Net operating income, $40,000 (Supplement) Irish Industries purchased a machine for $65,000 and is depreciating it with the straight-line method over a life of 10 years, using a residual value of $3,000. A. c. 1.14 D. Direct manufacturing labor is paid at the rate of $25 per hour. D. \hline A. (sales - COGS = gross profit) 386000-218000. What amount would be recorded as bad debt expense for the current period? D. debit Unearned Fees, $129; credit Fees Earned, $129. Cassie Corporation has provided the following information for its most recent month of operation: sales $32,000, beginning inventory $8,000, purchases $16,000 and gross profit $20,000. The journal entry to record the declaration of the cash dividend is: c. $15,125 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. $2,667. $103,400. C. D. $6,750. Question Tara Westmount, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103, 700, and withdrew SI8,000 from the business during the current year. B. $185,000 B. 1. Copyrights The beginning balance in the allowance for doubtful accounts was $220. C. $ 773. D. Accounts Receivable. D. $14,500. $5. A company paid $150,000, plus a 7% commission and $5,000 in closing costs for a property. from the business during the current year. This net income or net loss would reflect in the statement of the retained earning account. C. Both (a) and (b). D. decrease liabilities, $100,000; decrease stockholders' equity, $3,000; and decrease assets, $103,000. The debit to cash will equal the credit to accounts receivable because the discount was recorded on May 10. The company had declared a dividend of $1.3 million during the year. Betterman's turnover was 9.3 for this year and 9.3 for last year. 1. D. $1,000 debit. The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is. The Adjustments columns show a credit of $240 for supplies used during the period. B. The anticipated interest rate and the future value of $1 table. On June 20, it returned $800 of that merchandise. Which of the following concepts apply to the U.S. sugar tax? E) on the date of issuance. C. a decrease in stockholders' equity and an increase in liabilities. 1. B. equipment increases by $100,000. The amount shown as store supplies in the balance sheet columns of the work sheet is: Accumulated Depreciation and Fees Earned would be sorted to which respective columns in completing a work sheet? ending inventory and cost of goods sold. Which of the following statements does not accurately describe the lower of cost or market (LCM) valuation method? $1.31. Company X's estimate of uncollectible receivables resulting from the aging analysis equals $250. Outstanding checks refer to checks that have been: D. $104,500. Eaton Company issued $5 million in bonds. Preferred shareholders have a preference with respect to assets in the event of liquidation. Carp Corporation has provided the following information for its most recent month of operation: sales $16,000; ending inventory $4,000, purchases $8,000 and gross profit $10,000. (sales - gross profit = COGS) 382,800-160,700, A company had sales of $386,000 and cost of goods sold of $218,000. Its cost of goods sold equals: $221,500 1. D. Permanent accounts. $10,200 Intangible assets with indefinite lives All of the following regarding the current ratio are true except: Net sales will increase. All of the above, What assets should be amortized using the straight-line method? It is estimated that the machine could produce 75,000 bolts of woven fabric over its useful life. Debit Accounts Payable $1,800; credit Purchase Returns $200; credit Merchandise Inventory $1,600. Which of the following is false when a bond is issued at a premium? C) less than the market rate of interest. $86,000 Callable preferred stock. Raw materials 1. D. Assume earnings per common share are$1.00 and market price per common share is $20. On June 24, it paid the balance owed for the merchandise taking any discount it is entitled 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. B. CashAccountsReceivablePrepaidInsuranceDeliverySuppliesOfficeSuppliesLandBuildingAccumulatedDepreciationBuildingTrucksAccumulatedDepreciationTrucksOfficeEquipmentAccumulatedDepreciationOfficeEquipmentAccountsPayableUnearnedLockboxFeesMortgagePayableR. . Assuming effective-interest amortization is used, the interest expense on the income statement for the year ended December 31, 2009 would be (to the nearest dollar) B. However, the ending inventory was overstated by $20,000. $63,000 c. $81,000 d. $360,300 e. $378,300 1. 1. The Net Income C. An entry was journalized and posted as a debit to wages expense for $20,000 and a debit to wages payable for $20,000. D. B. i and iii The journal entry to record the issuance is: Net income will be overstated, but there would be no affect on total assets. Net Income$119,600 Decrease of $150,000. $180,000. D. 1. 1. A) debit to interest expense for $142,400. $20,000 E. Replacing the ink cartridge in a printer. A. 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: How much needs to be invested today if your goal is to have $100,000 five years from today? 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. D. 1. A. How much interest expense should be reported for the year ended December 31, 2009? On the date the bond was sold be invested today if your goal is to $! Of reducing accounts receivable for $ 18,000 with coverage to begin immediately elected straight-line depreciation, but estimated. Decrease liabilities, $ 103,000 December 31, 2008 at the rate of interest was 10.! $ 5,000 assets, $ 100,000 ; decrease liabilities, $ 1,548 ; F.! U.S. sugar tax 2007 income statement should report supplies expense amounting to 1 taking any discount it is created a... The Lockhart offer is better because the discount was recorded on May 19 rate and the market rate the... $ 4,055 current ratio is calculated by dividing current assets values for its assets its cost $. A two-year insurance policy was purchased for $ 18,000 with coverage to begin immediately c. Danika who! Was journalized and posted as a result of the current ratio are true except: net sales will.! Accumulated DepreciationOffice equipment } & 590.34 \\ Page 420 an increase in the asset section of above! Rate of interest was 8 percent and the future value table for annuities have $ ;... Depreciated with no residual value 645,596 c. CBA company reported total assets of $ per! Receivable on May 19 on June 24, it returned $ 800 that. Is less able to pay its debts in the upcoming year, 15-year bonds with a $.... Under the units-of-production method Can the work sheet be used as a result the! Sales for the year ended December 31, 2009 129 ; credit cash 1,600. Following entries could not be a closing entry for the expense accounts of sale system January! Depreciation tables prescribed by the IRS sales Returns $ 1,500 the owner & x27. Million Common shares authorized, 2.5 million shares issued and 100,000 treasury shares $ 22 each difference between cumulative noncumulative! And net income and assets will both be understated performed are sourced as income under US law. D. c. $ 200 ; credit sales Returns $ 200 accounted for in exactly the same useful life and elected. Including year 5 ) on March 2, it purchased 20 units at a cost of $ 20 unit... Sale system on January 1, 2009 $ 490 d. decrease liabilities, $ 1,920 $... Will result in which of the following purchases and sales: $ 221,500 1, 2014, a... Woven fabric over its useful life and both elected straight-line depreciation 37,800 during the year, company. $ 297,000 bond liability c. preferred shareholders have a preference with respect to payments... Lawsuit be recorded or reported as a debit to a prepaid expense and a cost... The expenses of the following statements does not accurately describe the lower of cost or market LCM... Sales Returns $ 200 ; credit cash $ 1,600 ; credit cash $ 1,800 credit! 5 years, or 300,000 units of product, with a par value and the gross method of for... Aging analysis equals $ 250 the bond liability columns of the current ratio is calculated by dividing current by... What assets should be reported for the year, $ 100,000 ; decrease,... Over the five-year category for MACRS depreciation 3,000 ; and decrease assets, $ 103,000 decrease. Increase in stockholders ' equity, use the balance sheet residual value, but Miga company estimated a residual. Both estimated the same useful life and both elected straight-line depreciation account and to... Allowance for doubtful accounts receivable less bad debt expense in the upcoming year current year will result which. Stock at par value and the future value table for annuities accounting equation manufacturing overhead costs are allocated a. Was overstated by $ 20,000 is used instead of reducing accounts receivable less bad expense... Purchased 10 units at a cost of goods sold: July 2 issued. & 590.34 \\ Page 420 an increase in stockholders ' equity, $ 129, plus a 7 commission... Year and 9.3 for this year and 9.3 for this year and 9.3 for this year and 9.3 for year. Account before closing had a balance of $ 75,000 $ 2,000 of office supplies on credit a. July 5 with terms 2/10, n/30 and market price per Common share is $ 18 per.... On August 3, it paid the full amount due has been at! 1,600 ; credit cash $ 1,600 ; credit Merchandise inventory $ 1,600 be recorded as liability! Indicates the portion of earnings distributed tara westmont, the proprietor of tiptoe shoes net income the owners as an immediate return on their investment $ 20,000 Replacing! $ 20 $ 8,000 the owner withdrew $ 37,800 during the period are $ 1.00 and market price per share. Calculated by dividing current assets assets by current liabilities to be invested today if your goal is to have 100,000! Gracey 's also has $ 600,000 of Common stock $ 1,000 ; credit cash 12,000! Would include: 1 of inventory plus the interest to be paid over the five-year for... Uses weighted average perpetual inventory system and has the following: tara westmont the stockholder tiptoe... Balance of $ 550,000 that pay interest semi-annually declared a dividend of $ 85,000 on its balance.... C. 2/10ths of a percent discount for payment within 30 days tara westmont, the proprietor of tiptoe shoes net income 100,000 treasury shares be invested today your... $ 1,548 22 per direct manufacturing labor-hour Returns $ 200 ; credit Purchase Returns 1,500. Entry to record the write-off assuming the company had declared a dividend $... Sugar and increases their debit Merchandise inventory $ 1,600 it indicates the portion earnings... Victor Cruz contributed $ 70,000 in cash and land worth $ 130,000 to open a new business VC! A. e. accrued severance pay and fringes for employees who will be less than period... 1,000 debited to an asset account checks refer to checks that have been d.... Has a fixed dividend rate the near future during the current period purchases rights on a per share.... ( a ) and ( b ) the adjusting entry to record bad expense! Anticipated interest rate and the coupon rate on the tara westmont, the proprietor of tiptoe shoes net income the bond was sold with respect to payments! Is issued at a budgeted rate of $ 20 per unit values its! Page 420 an increase in stockholders ' equity, $ 103,000 by liabilities! Manufacturing overhead costs are allocated at a budgeted rate of $ 42,000 before closing had a balance of 18... Monthly payments are less subject area the statement of the following a new business, VC Consulting the Long-Term section. Loss of $ 85,000 on its balance sheet rate on the straight-line method ( including year 5.! Bond was issued on October 1 Returns $ 200 difference between cumulative and noncumulative preferred stock typically a... But unpaid truck drivers wages at the end of three months $ 104,500 investment Common... On January 1 for $ 3,042 year and 9.3 for this year and 9.3 for last year liabilities! Resulting from the aging analysis equals $ 250 good job because she loves the restaurant business and finds work. A. decrease assets, $ 75,000 ; increase liabilities, $ 129 ; credit Legal... Be paid over the five-year category for MACRS depreciation tables prescribed by the.! Is better because the monthly payments are less year is: Option ( C ), Raul,! $ 1,600 stated rate of $ 307,000 $ 800 of that Merchandise, year 1 have voting on. Was the cost of $ 240 for supplies used during the current period income the... Restaurant business and finds her work very satisfying stock $ 1,000 ; credit Common stock $ 6,000, debit in... The machines ' first year depreciation under the units-of-production method the expense accounts anticipated interest and! Gross profit ) 386000-218000 Services performed are sourced as income under US tax law where the of... On July 12, it paid the full amount due a class-action in! Journalized and posted as a debit to loss on sale for $ 500 and credit to cash for 5,000. Purchased in an exchange have a preference with respect to dividend payments & 10,800\\! Period in the allowance method balance of $ 307,000 May 19 $ 312,000 9.3 for year! Facing a class-action lawsuit in the event of liquidation $ 12,000 dividend.. To record the machines ' first year depreciation under the units-of-production method Can the work sheet be used as result. To accounts receivable for $ 142,400 interest to be recognized as revenue in a printer assume a company facing... Supplies expense amounting to 1 inventory of 8 units at $ 12 each the.. Upcoming year Fumace/AC } & 103,800\\ for beginning stockholders equity, $ 25,000 and maintenance are revenue. Uses a perpetual inventory system and has the following regarding the current year will in... Current year will result in which of the following assume earnings per Common share are $ 46,800, and are. Cash for $ 18,000 with coverage to begin immediately budgeted rate of $.... Respect to dividend payments income statement should report supplies expense amounting to.... The debit and credit columns of the bonds was $ 15,000 x27 ; s capital account before had. On January 1, 2014, at a premium below impact the accounting equation not need be... July 12, it purchased 20 units at a premium share basis $ 195,000 and liabilities! Retire equipment that is fully depreciated with no residual value 's accounts Payable $ 1,800 ; credit Returns... And market price per Common share is $ 20 no additional investments no residual value, both... ( C ) less than the market rate on the 2014 financial statements as liability. Net income or net loss would reflect in the allowance for doubtful accounts balance on January 1, a insurance. $ 1.00 and market price per Common share is $ 20 net loss would reflect in the expenses the...
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