Please Note: It is recommended that you save your response as you complete each question. Question 1 (2 points) On July 1 of the current year, the assets and liabilities of John Wong, DVM, are as follows: Cash, $15,000; Accounts Receivable, $12,300; Supplies, $3,100; Land, $35,000; Accounts Payable, $8,700. What is the amount of owner’s equity (John Wong’s capital) as of July 1 of the current year?Question 1 options: $32,100 $43,700 $56,700 $65,400 SaveQuestion 2 (2 points) If beginning capital was $70,000, ending capital is $48,000, and the owner’s withdrawals were $21,000, the amount of net income or net loss wasQuestion 2 options: net income of $42,000 net income of $17,000 net loss of $22,000 net loss of $1,000 SaveQuestion 3 (2 points) Collins Landscape Company purchased various landscaping supplies on account to be used for landscape designs for their customers. How will this business transaction affect the accounting equation?Question 3 options: Increase Assets (Supplies) and increase Liabilities (Accounts Payable) Increase Assets (Supplies) and decrease Assets (Cash) Increase Assets (Supplies) and decrease Owner’s Equity (Supplies Expense) Increase Owner’s Equity (Supplies Expense) and increase Liabilities (Accounts Payable) SaveQuestion 4 (2 points) Gomez Service Company paid their first installment on their Notes Payable in the amount of $2,000. How will this transaction affect the accounting equation?Question 4 options: Increase Liabilities (Notes Payable) and decrease Assets (Cash) Decrease Assets (Cash) and decrease Owner’s equity (Note Payable Expense) Decrease Assets (Cash) and decrease Assets (Notes Receivable) Decrease Assets (Cash) and decrease Liabilities (Notes Payable) SaveQuestion 5 (2 points) Which of the following is not a business transaction?Question 5 options: Erin deposits $15,000 in a bank account in the name of Erin’s Lawn Service. Erin provided services to customers earning fees of $600. Erin purchased hedge trimmers for her lawn service agreeing to pay the supplier next month. Erin pays her monthly personal credit card bill. SaveQuestion 6 (2 points) Which of the following financial statements reports information as of a specific date?Question 6 options: income statement statement of owner’s equity statement of cash flows balance sheet SaveQuestion 7 (2 points) Cash investments made by the owner to the business are reported on the statement of cash flows in theQuestion 7 options: financing activities section investing activities section operating activities section supplemental statement SaveQuestion 8 (2 points) If the owner wanted to know how money flowed into and out of the company, what financial statement would she use?Question 8 options: Income Statement Statement of Cash Flows Balance Sheet None are correct. SaveQuestion 9 (2 points) Which of the following is not a principle financial statement?Question 9 options: Income Statement Statement of Resources Owned Statement of Owner’s Equity Statement of Cash Flows Balance Sheet SaveQuestion 10 (2 points) The unit of measure concept: Question 10 options: is only used in the financial statements of manufacturing companies. is not important when applying the cost concept. requires that different units be used for assets and liabilities. requires that economic data be reported in yen in Japan or dollars in the U.S. SaveQuestion 11 (2 points) In accordance with the debit and credit rules, which of the following is true?Question 11 options: Debits increase assets Credits increase assets Debits increase both assets and capital Credits increase both assets and liabilities. SaveQuestion 12 (2 points) Expenses follow the same debit and credit rules asQuestion 12 options: Revenues Drawing Account Capital Account Liabilities SaveQuestion 13 (2 points) Net income will result whenQuestion 13 options: revenues (credits) > expenses (debits) revenues (debits) > expenses (credits) expenses (credits) < revenues (debits) revenues (credits) = expenses (debits) SaveQuestion 14 (2 points) 2,000 4,700 Which is the best explanation for this journal entry?Question 14 options: Purchased equipment, paid cash of $2,000, with the remainder to be paid in payments Purchased equipment, paid cash of $2,000, with the remainder to be received in the future. Purchased equipment, paid cash for the entire amount Purchased equipment on credit. SaveQuestion 15 (2 points) The post reference columns are used to trace transactions from the journal to the accounts. What will be posted on the post reference column of (a) the journal and (b) on the account?Question 15 options: (a) the amount of the debit or credit (b) the journal page number (a) the journal page number (b) the date of the transaction (a) the journal page number, (b) the account number (a) the account number, (b) the journal page number SaveQuestion 16 (2 points) The chart of account for the Miguel Company includes some of the following accounts:Account Name Account Number Cash 11 Accounts Receivable 13 Prepaid Insurance 15 Accounts Payable 21 Unearned Revenue 24 Miguel, Capital 31 Miguel, Drawing 32 Fees Earned 41 Salaries Expense 54 Rent Expense 56 On the journal page 5, the following transaction was found:525 What is the post reference that will be found on the Salaries Expense account?Question 16 options: 5 11 54 None SaveQuestion 17 (2 points) The accounts in the ledger of Monroe Entertainment Co. are listed in alphabetical order. All accounts have normal balances.Fees Earned 3,000 Insurance Expense 1,300 Land 3,000 Wages Expense 1,400 Owner’s Equity 8,800 Prepare a trial balance. The total of the debits isQuestion 17 options: $13,300 $9,400 $9,100 $9,600 $20,600 SaveQuestion 18 (2 points) When a transposition error is made on the trial balance, the difference between the debit and credit totals on the trial balance will beQuestion 18 options: zero twice the amount of the transposition one-half the amount of the transposition divisible by 9 SaveQuestion 19 (2 points) Which of the following errors will cause the trial balance totals to be unequal?Question 19 options: amount incorrectly entered on the trial balance failure to record a transaction or to post a transaction recording the same transaction more than once recording the same erroneous amount for both the debit and the credit parts of a transaction posting a part of a transaction correctly as a debit or credit but to the wrong account SaveQuestion 20 (2 points) Which of the following is not a short-cut in finding errors on the trial balance?Question 20 options: Determine the difference between debits and credits and look for the amount. Determine the amount and change any account to make the trial balance correct. Determine the difference between debits and credits, divide the amount by 2, look for the amount. Determine the difference between debits and credits, divide the amount by 9, if it divides evenly, look for a transposition or slide error. SaveQuestion 21 (2 points) Prepaid advertising, representing payment for the next quarter, would be reported on the balance sheet as a(n)Question 21 options: asset liability contra asset expense SaveQuestion 22 (2 points) The general term employed to indicate a delay of the recognition of an expense already paid or of a revenue already received isQuestion 22 options: depreciation deferral accrual inventory SaveQuestion 23 (2 points) The unearned rent account has a balance of $36,000. If $4,000 of the $36,000 is unearned at the end of the accounting period, the amount of the adjusting entry isQuestion 23 options: $4,000 $40,000 $32,000 $36,000 SaveQuestion 24 (2 points) What effect will this adjustment have on the accounting records?3,300 Question 24 options: Increase net income Increase revenues reported for the period Decrease liabilities All are true. SaveQuestion 25 (2 points) How will the following adjusting journal entry affect the accounting equation?.11,500 Question 25 options: Increase assets, increase revenues Increase liabilities, increase revenues Decrease liabilities, increase revenues Decrease liabilities, decrease revenues SaveQuestion 26 (2 points) The account type and normal balance of Accumulated Depreciation isQuestion 26 options: revenue, credit expense, debit asset, credit asset, debit SaveQuestion 27 (2 points) The balance in the supplies account, before adjustment at the end of the year is $725. The proper adjusting entry if the amount of supplies on hand at the end of the year is $300 would beQuestion 27 options: debit Cash $300, credit Supplies $300 debit Supplies Expense $425, credit Supplies $425 debit Supplies Expense $300, credit Supplies $300 debit Supplies $425, credit Supplies Expense $425 SaveQuestion 28 (2 points) At the end of the fiscal year, the usual adjusting entry for depreciation on equipment was omitted. Which of the following statements is true?Question 28 options: Total assets will be understated at the end of the current year. The balance sheet and income statement will be misstated but the statement of owner’s equity will be correct for the current year. Net income will be overstated for the current year. Total liabilities and total assets will be understated. SaveQuestion 29 (2 points) Which of the accounts below would appear on an adjusted trial balance but probably would not appear on the trial balance?Question 29 options: Fees Earned Accounts Receivable Unearned Fees Depreciation Expense SaveQuestion 30 (2 points) What is the purpose of the adjusted trial balance?Question 30 options: to verify that all of the adjusting entries have been posted to verify that the net income <loss> is correctly reported to verify that no adjusting journal entry has been omitted. to verify that the debits and credits balance SaveQuestion 31 (2 points) Use the following worksheet to answer the following questions. Finley CompanyWorksheetFor the Year Ended December 31, 2010 Adjusted Trial Balance Income Statement Balance Sheet Account Title Debit Credit Debit Credit Debit Credit 18,000 30,000 6,000 33,000 Totals 228,000 228,000 96,000 141,000 132,000 87,000 45,000 141,000 141,000 132,000 132,000 The journal entry to close revenues would be:Question 31 options: debit Income Summary $141,000, credit Fees Earned $141,000 debit C. Finley, Capital $141,000, credit Fees Earned $141,000 debit Fees Earned $141,000; credit Income Summary $141,000 credit Fees Earned $141,000; credit C. Finley, Capital $141,000 SaveQuestion 32 (2 points) Use the following worksheet to answer the following questions. Finley CompanyWorksheetFor the Year Ended December 31, 2010 Adjusted Trial Balance Income Statement Balance Sheet Account Title Debit Credit Debit Credit Debit Credit 18,000 30,000 6,000 33,000 Totals 228,000 228,000 96,000 141,000 132,000 87,000 45,000 141,000 141,000 132,000 132,000 Based on the preceding trial balance, the ending balance in C. Finley, Capital is:Question 32 options: $33,000 $75,000 $30,000 $78,000 SaveQuestion 33 (2 points) The following are steps in the accounting cycle. Of the following, which would be prepared last?Question 33 options: An adjusted trial balance is prepared. Transactions are posted to the ledger. An unadjusted trial balance is prepared. Adjusting entries are journalized and posted to the ledger. SaveQuestion 34 (2 points) The natural business yearQuestion 34 options: is a fiscal year that ends when business activities are at its lowest point. is a calendar year that ends when business activities are at its lowest point. is a fiscal year that ends when business activities are at its highest point. is a calendar year that ends when business activities are at its highest point. SaveQuestion 35 (2 points) When a work sheet is complete, the adjustment columns should haveQuestion 35 options: total credits greater than total debits if a net income was earned total debits greater than total credits if a net loss was incurred total debits greater than total credits if a net income was earned total debits equal total credits SaveQuestion 36 (2 points) After net income is entered on the work sheet, the Balance Sheet debit and credit columns mustQuestion 36 options: be the same amount as the total amount of the Income Statement debit and credit columns equal each other be the same amount as the total amount in the Adjusted Trial Balance debit and credit columns not be equal to each other and need not be the same total amounts as any other pair of columns on the work sheet SaveQuestion 37 (2 points) Which of the accounts below would not appear in the balance sheet columns of the worksheet?Question 37 options: Chad Daniels, Drawing Rent Earned Unearned Revenue Chad Daniels, Drawing and Unearned Revenue SaveQuestion 38 (2 points) An indication that the work sheet columns are in balance and the work sheet is completed isQuestion 38 options: the word “Total” is written at the bottom of each pair of columns each pair of columns is double underlined each pair of columns has the totals circled the final figures are written in ink SaveQuestion 39 (2 points) On March 1, a company collects revenue in advance for the next twelve months and credits a liability account. The adjusting entry at year end on the work sheet wouldQuestion 39 options: increase a liability account decrease an asset account decrease a revenue account decrease a liability account SaveQuestion 40 (2 points) The income statement columns in the worksheet show that debits are equal to $55,800 and credits are $62,705. What does this information mean to the accountant?Question 40 options: Net income of $6,905 Net loss of $6,905 The accounts are out of balance, indicating an error has been made. The accounts have not been updated. SaveQuestion 41 (2 points) An investment made by the owner should be recorded on the Question 41 options: cash receipts journal purchases journal cash payments journal general journal SaveQuestion 42 (2 points) Which journal would adjusting entries be found?Question 42 options: Cash Receipts Journal Cash Payments Journal General Journal General Ledger SaveQuestion 43 (2 points) Special journal entries are Question 43 options: all posted at the end of the accounting period posted either daily or monthly depending on the accounts used all posted daily recorded in addition to the same information being recorded in a general journal SaveQuestion 44 (2 points) Beachside Coffee Shop, in an effort to stream line its accounting system, has decided to utilize a Cash Receipts Journal in its operation. If the company is to record the cash sale of food for $35 plus $2 of sales taxes. Which is the correct entry?Cash Receipts Journal Date AccountCredited Post Ref CashDr BevRevenueCr FoodRevenueCr RetailRevenueCr Sales TaxPayable Cr Question 44 options: Cash Dr. $35, Food Revenue Cr. $35, Sales Tax Payable $2 Cash Dr. $37, Food Revenue Cr. $37 Cash Dr. $37, Food Revenue Cr. $35, Sales Tax Payable $2 Cash Dr. $2, Food Revenue Cr. $2 SaveQuestion 45 (2 points) Beachside Coffee Shop, in an effort to stream line its accounting system, has decided to utilize a Cash Receipts Journal in its operation. What would be recorded in the Post Ref column for this transaction?Cash Receipts Journal Date AccountCredited Post Ref CashDr BevRevenueCr FoodRevenueCr Sales Tax Pay.Cr OtherCr 345 Question 45 options: 15 43 10 Ö SaveQuestion 46 (2 points) Beachside Coffee Shop, in an effort to stream line its accounting system, has decided to utilize a Cash Receipts Journal in its operation. What would be recorded as the Post Ref for the Sales Tax Pay. column, and where on the journal would it appear?Cash Receipts Journal Date AccountCredited Post Ref CashDr BevRevenueCr FoodRevenueCr Sales Tax Pay.Cr OtherCr 5,444 3,089 1,907 55 393 Question 46 options: (23) in the Post Ref column (Ö) Post Ref for the total of the Sales Tax Pay column (55) under the Sales Tax Pay column (23) under the Sales Tax Pay column SaveQuestion 47 (2 points) Which of the following is not true about computerized accounting systems?Question 47 options: Include authorization controls before a transaction can be completed Computer accounting systems require less internal controls. The computer screen is often designed to make a specific transaction easy to input. The database is updated once the transaction is submitted, making it easy to run updated reports. SaveQuestion 48 (2 points) Which of the following is not an advantage of a computer accounting systems?Question 48 options: Special journals are not typically used. Reports are easy to generate. Automatic posting to account balances. Month end postings to controlling accounts. SaveQuestion 49 (2 points) A reverse auction isQuestion 49 options: similar to EBay, except that the bidders are wholesalers, not consumers. when companies request vendors to provide quotes for common items such as supplies they wish to purchase. when companies solicit on-line orders from customers at lower than retail prices. when companies receive payment for products or services before receiving their goods. SaveQuestion 50 (2 points) Many companies are using the Internet for other business purposes except Question 50 options: Supply chain management Product life-cycle management Customer relationship management Reporting management SaveQuestion 51 (2 points) 1. $7,000 of merchandise inventory was ordered on September 2, 2009 2. $3,000 of this merchandise was received on September 5, 2009 3. On September 6, 2009, an invoice dated September 4, 2009, with terms of 3/10, net 30 for $3,250 which included a $250 prepaid freight cost, was received. 4. On September 10, 2009, $800 of the merchandise was returned to the seller. Based on the above information, what would the journal entry for September 10, 2009 include?Question 51 options: Debit to Merchandise Inventory 0 Debit to Purchases Returns $800 Credit to Merchandise Inventory 0 Credit to Accounts Payable $800 SaveQuestion 52 (2 points) Who pays the freight costs when the terms are FOB shipping point?Question 52 options: the ultimate customer the buyer the seller either the seller or the buyer SaveQuestion 53 (2 points) Which of the following accounts, will only be found in the chart of accounts of a merchandising company?Question 53 options: Sales Accounts Receivable Merchandise Inventory Accounts Payable SaveQuestion 54 (2 points) If title to merchandise purchases passes to the buyer when the goods are shipped from the seller, the terms are Question 54 options: n/30 FOB shipping point FOB destination consigned SaveQuestion 55 (2 points) When the perpetual inventory system is used, the inventory sold is debited to Question 55 options: supplies expense cost of merchandise sold merchandise inventory sales SaveQuestion 56 (2 points) Which of the following items should not be included in the cost of ending merchandise inventory?Question 56 options: units on consignment purchased units in transit, shipped FOB destination units on hand in the warehouse both (a) and (c) SaveQuestion 57 (2 points) Which account will be included in both service and merchandising companies closing entries?Question 57 options: Sales Cost of Merchandise Sold Sales Discounts Sales Returns and Allowances SaveQuestion 58 (2 points) What is the major difference between a periodic and perpetual inventory system?Question 58 options: Under the periodic inventory system, the purchase of inventory will be debited to the Purchases account Under the periodic inventory system, no journal entry is recorded at the time of the sale of inventory. Under the periodic inventory system, all adjustments such as purchases returns and allowances and discounts are reconciled at the end of the month. All are correct. SaveQuestion 59 (2 points) Under the periodic inventory system, the journal entry to record the cost of merchandise sold at the point of sale will include the following accountQuestion 59 options: No entry is made. Cost of merchandise sold Inventory Purchases sold SaveQuestion 60 (2 points) Which of the following accounts should be closed to Income Summary at the end of the fiscal year?Question 60 options: Merchandise Inventory Accumulated Depreciation Drawing Cost of Merchandise Sold SaveQuestion 61 (2 points) During a period of consistently rising prices, the method of inventory that will result in reporting the greatest cost of merchandise sold is Question 61 options: FIFO LIFO average cost weighted average SaveQuestion 62 (2 points) During a period of falling prices, which of the following inventory methods generally results in the lowest balance sheet amount for inventory.Question 62 options: average method LIFO method FIFO method can not tell without more information SaveQuestion 63 (2 points) If a manufacturer ships merchandise to a retailer on consignment, the unsold merchandise should be included in the inventory of the Question 63 options: consignee retailer manufacturer shipper SaveQuestion 64 (2 points) Merchandise inventory at the end of the year was understated. Which of the following statements correctly states the effect of the error?Question 64 options: net income is understated net income is overstated cost of merchandise sold is understated merchandise inventory reported on the balance sheet is overstated SaveQuestion 65 (2 points) If the cost of an item of inventory is $50 and the current replacement cost is $57, the amount included in inventory according to the lower of cost or market is Question 65 options: $7 $50 $57 $107 SaveQuestion 66 (2 points) If a company mistakenly counts more items during a physical inventory than actually exist, how will the error affect their bottom line?Question 66 options: No change to net income. Net income will be overstated Net income will be understated. Only gross profit will be affected. SaveQuestion 67 (2 points) The method of computing inventory that uses records of the selling prices of the merchandise is called Question 67 options: retail method last-in, first-out first-in, first-out average cost SaveQuestion 68 (2 points) Too much inventory on hand Question 68 options: reduces solvency increases the cost to safeguard the assets increases the losses due to price declines all of the above SaveQuestion 69 (2 points) Garrison Company uses the retail method of inventory costing. They started the year with an inventory that had a retail cost of $45,000. During the year they purchased an inventory with a retail cost of $300,000. After performing a physical inventory, they calculated their inventory at $80,000. The mark up is 100% of cost. Determine the ending inventory at its estimated cost.Question 69 options: $160,000 $80,000 $40,000 $45,000 SaveQuestion 70 (2 points) The following lots of a particular commodity were available for sale during the year:Beginning inventory 5 units at $61 First purchase 15 units at $63 Second purchase 10 units at $74 Third purchase 10 units at $77 The firm uses the periodic system and there are 20 units of the commodity on hand at the end of the year. What is the amount of the inventory at the end of the year according to the average cost method?Question 70 options: $1,380 $1,375 $1,510 $1,220 SaveQuestion 71 (2 points) Receipts from cash sales of $7,500 were recorded incorrectly in the cash receipts journal as $5,700. This item would be included on the bank reconciliation as a(n) Question 71 options: deduction from the balance per company’s records addition to the balance per bank statement deduction from the balance per bank statement addition to the balance per company’s records SaveQuestion 72 (2 points) The amount of the outstanding checks is included on the bank reconciliation as a(n) Question 72 options: deduction from the balance per company’s records addition to the balance per bank statement deduction from the balance per bank statement addition to the balance per company’s records SaveQuestion 73 (2 points) During the month, a company was informed that a check they had issued was accidentally destroyed. On the bank reconciliation, the company would Question 73 options: deduct the amount from the balance per the company’s records deduct the amount from the balance per the bank statement Add the amount to the balance per the bank statement Add the amount to the balance per the company’s records SaveQuestion 74 (2 points) Which of the following would be subtracted from the balance per books on a bank reconciliation?Question 74 options: Outstanding checks Deposits in transit Notes collected by the bank Service charges SaveQuestion 75 (2 points) Derek Company gathered the following reconciling information in preparing its September bank reconciliation:Cash balance per books, 9/30 $2,750 Deposits in transit 200 Notes receivable and interest collected by bank 630 Bank charge for check printing 30 Outstanding checks 1,250 NSF check 190 The adjusted cash balance per books on September 30 is Question 75 options: $5,050. $2,110. $3,160. $1,910. SaveQuestion 76 (2 points) A $150 petty cash fund has cash of $28 and receipts of $110. The journal entry to replenish the account would include aQuestion 76 options: credit to Petty Cash for $82. debit to Cash for $110. debit to Cash Over and Short for $12. credit to Cash for $110 SaveQuestion 77 (2 points) The type of account and normal balance of Petty Cash is a(n) Question 77 options: revenue, credit asset, debit liability, credit expense, debit SaveQuestion 78 (2 points) Cash equivalents Question 78 options: are illegal in some states will be converted to cash within two years will be converted to cash within 90 days will be converted to cash within 120 days SaveQuestion 79 (2 points) During 2009, Tempo Inc has monthly cash expenses of $120,000. On December 31, 2009, their cash balance is $1,860,000. The ratio of cash to monthly cash expenses is Question 79 options: 6.5 15.5 77.4 12.0 SaveQuestion 80 (2 points) In the normal operation of business you receive a check from a customer and deposit it into your checking account. With your bank statement you are advised that this check for $425 is “NSF”. The bank also informs you that due to the amount of activity on your business account the monthly service charge is $45. During a bank reconciliation:Question 80 options: subtract both values from balance according to bank. add both values from balance according to books. add both values from balance according to bank. subtract both values from balance according to books. SaveQuestion 81 (2 points) To record estimated uncollectible accounts using the allowance method, the adjusting entry would be aQuestion 81 options: debit to Bad Debts Expense and a credit to Allowance for Doubtful Accounts. debit to Accounts Receivable and a credit to Allowance for Doubtful Accounts. debit to Allowance for Doubtful Accounts and a credit to Accounts Receivable. debit to Loss on Credit Sales and a credit to Accounts Receivable. SaveQuestion 82 (2 points) Under the allowance method, when a year-end adjustment is made for estimated uncollectible accountsQuestion 82 options:Liabilities decrease. Net Income is unchanged. Total Assets are unchanged. Total Assets decrease. SaveQuestion 83 (2 points) Interest on a note can be calculated without knowledge of the Question 83 options: note’s maturity date rate of interest notes duration principal amount SaveQuestion 84 (2 points) A $6,000, 60-day, 12% note recorded on November 21 is not paid by the maker at maturity. The journal entry to recognize this event is Question 84 options: debit Cash, $6,120; credit Notes Receivable, $6,120 debit Accounts Receivable, $6,120; credit Notes Receivable, $6,000; Credit Interest Receivable, $120 debit Notes Receivable, $6,060; credit Accounts Receivable, $6,060 debit Accounts Receivable, $6,120; credit Notes Receivable, $6,000; Credit Interest Revenue, $120 SaveQuestion 85 (2 points) When a company receives an interest-bearing note receivable, it willQuestion 85 options: debit Notes Receivable for the maturity value of the note. debit Notes Receivable for the face value of the note. credit Notes Receivable for the maturity value of the note. credit Notes Receivable for the face value of the note. SaveQuestion 86 (2 points) Harper Company lends Hewell Company $40,000 on March 1, accepting a four-month, 6% interest note. Harper Company prepares financial statements on March 31. What adjusting entry should be made before the financial statements can be prepared?Question 86 options:200200 800800 200200 40,00040,000 SaveQuestion 87 (2 points) Receivables are usually listed in order Question 87 options: of the due date of the size alphabetically of liquidity SaveQuestion 88 (2 points) The amount received by the endorser after discounting a note receivable at the bank is called the Question 88 options: proceeds maturity value face value realizable value SaveQuestion 89 (2 points) A 60-day, 12% note for $10,000, dated May 1, is received from a customer on account. If the note is discounted on May 21 at 15%, the amount of interest revenue or expense to be recorded by the payee of the note on May 21 is Question 89 options: $30 interest expense $30 interest revenue $170 interest revenue $170 interest expense SaveQuestion 90 (2 points) A 90-day, 12% note for $20,000, dated April 10, is received from a customer on account. If the note is discounted at 15% on May 20, the days in the discount period are Question 90 options: 50 90 120 40 SaveQuestion 91 (2 points) Computer equipment was acquired at the beginning of the year at a cost of $65,000 that has an estimated residual value of $3,000 and an estimated useful life of 5 years. Determine the 2nd year’s depreciation using straight-line depreciation.Question 91 options: $26,000 $24,800 $12,400 $13,000 SaveQuestion 92 (2 points) A fixed asset with a cost of $41,000 and accumulated depreciation of $36,000 is traded for a similar asset priced at $50,000. Assuming a trade-in allowance of $4,000, the cost basis of the new asset is Question 92 options: $54,000 $45,000 $51,000 $50,000 SaveQuestion 93 (2 points) The Bacon Company acquired new machinery with a price of $15,200 by trading in similar old machinery and paying $12,700. The old machinery originally cost $9,000 and had accumulated depreciation of $5,000. In recording this transaction, Bacon Company should record Question 93 options: the new machinery at $16,700 the new machinery at $12,700 a gain of $1,500 a loss of $1,500 SaveQuestion 94 (2 points) When a company exchanges machinery and receives a trade-in allowance greater than the book value, this transaction would be recorded with the following entry:Question 94 options: debit Machinery and Accumulated Depreciation; credit Machinery, Cash, and Gain on Disposal debit Machinery and Accumulated Depreciation; credit Machinery and Cash debit Cash and Machinery; credit Accumulated Depreciation debit Cash and Machinery; credit Accumulated Depreciation and Machinery SaveQuestion 95 (2 points) On December 31, Strike Company has decided to sell one of its batting cages. The initial cost of the equipment was $215,000 with an accumulated depreciation of $185,000. Depreciation has been taken up to the end of the year. The company found a company that is willing to buy the equipment for $30,000. What is the amount of the gain or loss on this transaction?Question 95 options: Gain of $30,000 Loss of $30,000 No gain or loss Cannot be determined SaveQuestion 96 (2 points) On December 31, Strike Company has decided to trade-in one of its batting cages for another one that has a cost of $500,000. The seller of the batting cage is willing to allow a trade-in amount of $40,000. The initial cost of the old equipment was $225,000 with an accumulated depreciation of $195,000. Depreciation has been taken up to the end of the year. The difference will be paid in cash. What is the amount of the gain or loss on this transaction?Question 96 options: The gain will not be recognized and will be added to the price of the old equipment. The gain will not be recognized and will be added to the price of the new equipment The gain will not be recognized and will be subtracted from the price of the old equipment The gain will not be recognized and will be subtracted from the price of the new equipment. SaveQuestion 97 (2 points) When a company replaces a component of property, plant and equipment, which statement below does not account for one of the steps to this process?Question 97 options: book value of the replaced component is written off to depreciation expense the asset cost of the replaced component is credited any cost to remove the old component is charged to expense the identifiable direct costs associated with the new component are capitalized SaveQuestion 98 (2 points) The Weber Company purchased a mining site for $500,000 on July 1, 2009. The company expects to mine ore for the next 10 years and anticipates that a total of 100,000 tons will be recovered. The estimated residual value of the property is $80,000. During 2009 the company extracted 4,000 tons of ore. The depletion expense for 2009 is Question 98 options: $10,500 $43,200 $16,800 $20,000 SaveQuestion 99 (2 points) Xtra Company purchased goodwill from Argus for $144,000. Argus had developed the goodwill over 6 years. How much would Xtra amortize the goodwill for its first year?Question 99 options: $8,640 $24,000 Goodwill is not amortized. Not enough information. SaveQuestion 100 (2 points) Fixed assets are ordinarily presented in the balance sheet Question 100 options: at current market values at replacement costs at cost less accumulated depreciation in a separate section along with intangible assets SaveQuestion 101 (2 points) An employee receives an hourly rate of $15, with time and a half for all hours worked in excess of 40 during the week. Payroll data for the current week are as follows: hours worked, 46; federal income tax withheld, $120; cumulative earnings for the year prior to this week, $5,500; Social security tax rate, 6% on maximum of $100,000; and Medicare tax rate, 1.5% on all earnings; state unemployment compensation tax, 3.4% on the first $7,000; federal unemployment compensation tax, .8% on the first $7,000. What is the employer’s payroll tax expense?Question 101 options: $55.13 $61.01 $86.00 $141.13 SaveQuestion 102 (2 points) Assume that social security taxes are payable at a 6% rate on the first $100,000 of earnings and medicare taxes are payable at a 1.5% rate with no maximum earnings, and that federal and state unemployment compensation taxes total 4.6% on the first $7,000 of earnings. If an employee, George Jones, earns $2,500 for the current week and Jones’ year-to-date earnings before this week were $6,800, what is the total payroll taxes related to the current week?Question 102 options: $187.50 $196.70 $344.50 none of the above SaveQuestion 103 (2 points) Which of the following is not an internal control procedure for payroll?Question 103 options: employees observed clocking in and out payroll depends on a fired employee’s supervisor to notify them when an employee has been fired payroll requires employees to show identification when picking up their paychecks changes in pay rates on a computerized system must be tested by someone independent of payroll SaveQuestion 104 (2 points) Vacation pay payable is reported on the balance sheet as Question 104 options: current liability or long-term liability, depending upon when the vacations will be taken by employees current liability owner’s equity long-term liabilities SaveQuestion 105 (2 points) The journal entry a company uses to record partially funded pension rights for its salaried employees, at the end of the year is Question 105 options: debit Salary Expense; credit Cash debit Pension Expense; credit Unfunded Pension Liability debit Pension Expense; credit Unfunded Pension Liability and Cash debit Pension Expense; credit Cash SaveQuestion 106 (2 points) Quick assets include Question 106 options: cash; cash equivalents, receivables, prepaid expenses, and inventory cash; cash equivalents, receivables, and prepaid expenses cash; cash equivalents, receivables, and inventory cash; cash equivalents, and receivables SaveQuestion 107 (2 points) Research Company sells merchandise with a one year warranty. In 2009, sales consisted of 2,500 units. It is estimated that warranty repairs will average $10 per unit sold, and 30% of the repairs will be made in 2009 and 70% in 2010. In the 2009 income statement, Searches should show warranty expense ofQuestion 107 options: $25,000 $7,500 $17,500 $0 SaveQuestion 108 (2 points) Elgin Company sells merchandise with a one year warranty. In 2009, sales consisted of 2,500 units. It is estimated that warranty repairs will average $10 per unit sold, and 30% of the repairs will be made in 2009 and 70% in 2010. In the 2009 income statement, Elgin should show warranty expense of Question 108 options: $7,500 $17,500 $25,000 $0 SaveQuestion 109 (2 points) Power Company sells merchandise with a one year warranty. In 2009, sales consisted of 1,600 units. It is estimated that warranty repairs will average $10 per unit sold, and 30% of the repairs will be made in 2009 and 70% in 2010. In the 2009 income statement, Power should show warranty expense of Question 109 options: $4,800 $11,200 $16,000 $0 SaveQuestion 110 (2 points) Estimating and recording product warranty expense in the period of the sale best follows which of the following accounting concepts?Question 110 options: Cost concept Business entity concept Matching Concept Materiality concept SaveQuestion 111 (1 point) The principle of Accounting that requires revenue to be recorded as soon as it is earned is called the Question 111 options:Principle B) Cost Principle C) Full Disclosure Principle D) Revenue Recognition Principle SaveQuestion 112 (1 point) The __________ principle requires that expenses be allocated to the period that they helped create income. Question 112 options: A) Revenue Recognition Principle C) Cost Principle D) Full Disclosure Principle. SaveQuestion 113 (1 point) The business entity concept means that Question 113 options: A) The owner is part of the business entity B) An entity is organized according to state or federal statues C) An entity is organized according to set by FASB D) The entity is an individual economic unit for which data are recorded, analyzed, and reported SaveQuestion 114 (1 point) All of the following are required steps in the accounting cycle except: Question 114 options: A) Preparing a work sheet B) Journalizing and posting closing entries C) Journalizing the transactions D) Preparing financial statements SaveQuestion 115 (1 point) ______________ are necessary at the end of an accounting period because some account balances do not show proper financial statement balances caused by the passage of time. Question 115 options: A) Adjusting Entries B) Analyzing Entries C) Closing Entries D) Reversing Entries SaveQuestion 116 (1 point) The first or original step in recording transactions is in the Question 116 options: A) Ledger B) Trial Balance C) Balance Sheet D) Journal SaveQuestion 117 (1 point) The financial statement that reports assets, liabilities, and owner?s equity is the Question 117 options: A) Owner’s Equity Statement B) Income Statement C) Statement of Cash Flows D) Balance Sheet SaveQuestion 118 (1 point) Question 118 options: A) Accounts Payable B) Owner’s Investment C) Withdrawals D) Rent Income SaveQuestion 119 (1 point) Liabilities are reported on the Question 119 options: A) Balance sheet B) Statement of owner’s equity C) Statement of cash flows D) Income statement SaveQuestion 120 (1 point) Which of the following would not qualify as an internal control procedure within a business: Question 120 options: A) Allow good employees to skip taking their vacations for extra pay. B) Use an internal auditor to determine if procedures are being followed C) Separate responsibilities for cash handling and record keeping. D) Rotate duties of personnel. SaveQuestion 121 (1 point) A necessary element of internal control is Question 121 options: A) Systems analysis B) Database C) Information and communication D) Systems design SaveQuestion 122 (1 point) Internal control does not consist of policies and procedures that Question 122 options: A) Guarantee the company will not go bankrupt B) Ensure that business information is accurate C) Protect assets from misuse D) Aid management in directing operations toward achieving business goals SaveQuestion 123 (1 point) Buehler Company on June 15 sells merchandise on account to Chaz Co. for $1000 terms 2/10, n/30. Chaz Co. returns merchandise of $300 to Buehler Company on June 17. On June 24 payment is received from Chaz Co. for the balance due. What should be the amount of cash received? Question 123 options: A) $700 B) $680 C) non of the above D) $686 SaveQuestion 124 (1 point) Using the term ______________ means that the buyer will pay the freight charges of the merchandise to the buyer’s place of business. Question 124 options: A) N/A B) N/A C) FOB Shipping Point D) FOB Destination SaveQuestion 125 (1 point) Taking a physical count of inventory Question 125 options: A) Has no internal control relevance B) Is a detective control C) Is not necessary when a periodic inventory system is used D) Is not necessary when a perpetual inventory system is used.