acc final exam

If a company has assets of $5,000,000, liabilities of $3,000,000, and retained earnings of $1,200,000, how much is total stockholders' equity? a.$3,800,000 b.$1,800,000 c.$2,000,000 d.$800,000

c.$2,000,000

While preparing the April 30th bank reconciliation, the accountant identified the following items:Company's balance according to the general ledger$15,000Outstanding checks2,500Bank service charge15A customer's NSF check returned by the bank100What is the company's adjusted cash balance at April 30th? a.$12,385 b.$14,885 c.$12,500 d.$17,385

b.$14,885

A bond issuing at 101.25 means that the bond a.sold at a discount. b.sold for $1,012.50. c.sold for $101.25. d.stated rate is lower than the market rate of interest.

b.sold for $1,012.50.

Klump Co. uses a perpetual inventory system and had the following inventory transactions for the month of June.June1On hand, 50 units at $18.00 each$900.00 4Purchased 115 units at $18.20 each$2,093.00 5Sold 100 units 10Purchased 75 units at $18.25 each$1,368.75 24Sold 50 units Total cost of goods available for sale$4,361.75 30On hand, 90 units Refer to the information provided for Klump Co. If the company uses the FIFO inventory costing method, the amount of ending inventory reported on the balance sheet is: a.$1,810.00 b.$1,183.00 c.$2,720.00 d.$1,641.75

d.$1,641.75

Ladder DistributorsThe stockholders' equity section of the December 31, 2019, balance sheet is provided below:Common Stock, $30 par, 20,000 shares issued and outstanding$600,000Paid-in Capital in Excess of Par--Common Stock240,000Retained Earnings700,000Total Stockholders' Equity$1,540,000Assume that all of the 20,000 shares of stock that was issued as of December 31, 2019, was issued for $42 per share. On March 1, 2020, the company reacquired 4,000 shares of its common stock for $50 per share.Refer to Ladder Distributors. What is the total amount of stockholders' equity that will be presented on the company's March 31, 2020, balance sheet? a.$1,340,000 b.$1,372,000 c.$1,708,000 d.$1,740,000

a.$1,340,000

If a company has current assets of $2,100,000 and current liabilities of $500,000, calculate its working capital. a.$2,600,000 b.$1,600,000 c.$500,000 d.$2,100,000

b.$1,600,000

Carlock Systems received a 6-month, 12% note for $50,000 from a customer on November 1, 2019. The note is due on April 30, 2020. Assuming the company's accounting period ends on December 31, how much interest revenue should be recognized during 2019 and 2020?2019 2020 a.$2,000 $1,000 b.$1,000 $2,000 c.$1,000 $5,000 d.$0 $6,000

b. $1,000 $2,000

The asset account, Supplies, has a balance of $10,000 on January 1. During January, $22,000 of supplies were purchased on account and the liability was appropriately recorded. A count of supplies at the end of January indicates a balance of $2,000. What adjusting entry is necessary at January 31? a.Supplies Expense22,000Supplies20,000Accounts Payable2,000 b.Supplies22,000Accounts Payable22,000 c.Supplies Expense30,000Supplies30,000 d.Supplies Expense24,000Supplies24,000

c. Supplies Expense30,000 Supplies30,000

A company reported the following information: 20202019Accounts receivable$50,000$65,000Inventories43,00040,000Accounts payable29,00039,000Net income100,000 Depreciation expense11,000 If the indirect method is used to prepare the operating activities section of the statement of cash flows, what amount will be reported as net cash inflow from operating activities for 2020? a.$92,000 b.$109,000 c.$113,000 d.$111,000

c.$113,000

Klump Co. uses a perpetual inventory system and had the following inventory transactions for the month of June.June1On hand, 50 units at $18.00 each$900.00 4Purchased 115 units at $18.20 each$2,093.00 5Sold 100 units 10Purchased 75 units at $18.25 each$1,368.75 24Sold 50 units Total cost of goods available for sale$4,361.75 30On hand, 90 units Refer to the information provided for Klump Co. If the company uses the LIFO inventory costing method, cost of goods sold for the month of June is: a.$2,738.00 b.$2,720.00 c.$2,732.50 d.$2,722.50

c.$2,732.50

All of the following accounts have normal credit balances except a.accounts payable. b.unearned revenue. c.inventory. d.common stock.

c.inventory.

If the end-of-year supplies on hand totaled $200, and purchases totaled $300, and supplies on hand at the beginning of the year amounted to $100, how much will be reported as supplies expense for the current year? a.$200 b.$400 c.$300 d.$600

a.$200

Manatee Manufacturing sells a piece of equipment to make room for new machinery. Manatee will receive the sales price of $50,000 at the end of 4 years. Assuming interest at a rate of 6% per year, the Present Value of this future cash flow is how much? a.$39,604.50 b.$63,124.00 c.$39,515.50 d.$173,255.50

a.$39,604.50

A company purchased land and incurred the following costs:Purchase Price$500,000Excavation Costs50,000Razing Old Building12,500Broker Fees10,000Cost of a Parking Lot25,000What is the cost of the land? a.$572,500 b.$550,000 c.$562,500 d.$597,500

a.$572,500

The company reported the following items on its financial statements for the year ended December 31, 2019:Sales$780,000Cost of Sales$700,000Selling, general & administrative expense20,000Other Expense15,000Dividends5,000Income Tax Expense12,500Refer to Bay Camera. What amount will be reported as Retained Earnings on the Balance Sheet at December 31, 2019, assuming this is the first year of operations? a.$42,500 b.$27,500 c.$22,500 d.Not enough information is provided.

b.$27,500

A company needs to record 6 months of accrued interest on a 4-year, 12%, $12,000 promissory note payable. How much interest expense should be accrued? a.$2,160 b.$720 c.$1,440 d.$1,080

b.$720

This company purchased a truck at a cost of $12,000. The truck has an estimated residual value of $2,000 and an estimated life of 5 years, or 100,000 hours of operation. The truck was purchased on January 1, 2019, and was used 27,000 hours in 2019 and 26,000 hours in 2020.Refer to Fabian Woodworks. If the company uses the straight-line method of depreciation, what is the book value at December 31, 2021? a.$4,000 b.$10,000 c.$6,000 d.$8,000

c.$6,000

Dreammaker KitchensThe following information relates to the company's November bank reconciliation:Bank statement balance$10,700Unadjusted cash balance from the company's records?Deposit in transit2,100Outstanding checks1,200Bank service charges300Interest earned on the bank account100Customer's NSF check returned by the bank400Refer to Dreammaker Kitchens. As a result of the bank reconciliation process, what is the net increase or decrease in cash which must be recorded on the company's books? a.$400 decrease b.$100 decrease c.$600 decrease d.$300 decrease

c.$600 decrease

Failure to record the earned portion of unearned revenue would result in which of the following? a.No effect on total liabilities. b.Stockholders' equity being overstated. c.Net income being understated. d.Total assets being understated.

c.Net income being understated.

During the first quarter of the current year, the company sold 4,000 batteries on credit for $150 each plus state sales tax of 6%.Refer to General Lighting. Sales taxes are required to be paid to the state taxing authority at the end of the quarter. Which of the following records the sale of the batteries? a.Accounts Receivable600,000Sales Revenue600,000 b.Accounts Receivable636,000Sales Revenue600,000Sales Tax Payable36,000 c.Accounts Receivable600,000Sales Revenue564,000Sales Tax Payable36,000 d.Accounts Receivable636,000Sales Revenue636,000

Accounts Receivable636,000 Sales Revenue600,000 Sales Tax Payable36,000

Which of the following adjusting entries involves the cash account? a.Accrued Expenses b.Deferred Liabilities c.Deferred Revenues d.None of these choices are correct.

d.None of these choices are correct.

Data for the year ended December 31 are presented below:Sales (credit)$2,500,000Sales returns and allowances50,000Accounts Receivable (December 31)640,000Allowance for Doubtful Accounts (Before adjustment at December 31)20,000Estimated amount of uncollected accounts based on aging analysis45,000Refer to AT&U Company. If the company estimates its bad debts at 1% of net credit sales, what amount will be reported as bad debt expense? a.$44,500 b.$25,000 c.$4,500 d.$24,500

d.$24,500

Tom liquidates an investment, and his proceeds will be received in 8 annual payments of $10,000 each with interest computed at 7%. What is the Present Value of this Annuity? a.$89,228.00 b.$17,181.90 c.$5,820.10 d.$59,713.00

d.$59,713.00