Accounting 201 Bass/Test 2 Taylor

#4. If the end of the 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. $400 b. $300 c. $200 d. $600

200

#1. Under accrual accounting when is revenue recognized? a. when earned, and expenses when incurred b. when cash is received, and expenses when cash is paid c. when cash is received, and expenses when the cost are incurred d. when earned, and expenses when cash is paid

When earned, and expenses when incurred.

#11 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.$12,500 b.$12,385 c.$17,385 d.$14,885

$14,885

#15. Data for the year ended December 31st are presented below Sales (credit) $2,500,000 Sales returns and allowances $50,000 Accounts receivable (December 31) $40,000 Allowance for doubtful accounts (Before adjustment at December 31) $20,000 Estimated amount of uncollected accounts based on aging analysis $45,000 refer to AT&U company. If the company estimates its bad debts at 1% of non credit sales what amount will be reported as bad debt expense? a. $4500, b. $25,000 c. 24,500 d. 44,500

$24,500

#12 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 bank400 Refer 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.$600 decrease c.$100 decrease d.$300 decrease

$600 decrease

#16. Data for the year ended December 31st are presented below Sales (credit) $2,500,000 Sales returns and allowances $50,000 Accounts receivable (December 31) $40,000 Allowance for doubtful accounts (Before adjustment at December 31) $20,000 Estimated amount of uncollected accounts based on aging analysis $45,000 Refer to the AT&U company. If the company estimates its bad debt to be 2% of non credit sales what will the balance in the allowance for doubtful accounts account after the adjustment for bad debt. a. 49,000 b. 20,000 c. 19,000 d. 69,000

$69,000

#3. Cozy Corporation purchased supplies at a cost of $15,000 during the year. At January 1 supplies on hand were $5000. At December 31 supplies on hand were $2000. Calculate supplies expense for the year. a. $2000 b. 10,000 c. 15,000 d. 13,000

18,000

#14 Calculator A company receiving payment of a $20,000 accounts receivable within 10 days with terms of 2/10, n/30, would record a sales discount of: a.2% of $20,000 b.10% of $20,000 c.(100% - 10%) x $20,000 d.(100% - 2%) x $20,000

2% of $20,000

#2. Carlock System's 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 companies accounting period ends on December 31, how much interest revenue should be recognized during 2019-2020. 2019 2020 A. $2000 $ 1000 B. $0 $ 6000 C $1000 $5000 D $1000 $2000

2019: 1,000 2020: 2,000

#19.The company received a promissory note on March 1, 2019. The principal amount of the note is $20,000: the terms are 3 months and 9% annual interest. Refer to the information for accent flooring . What is the total of the interest the company will receive when the note is collected? a. $300 b. $1800 c. $150 d $450

450

#17. A company need to record a 6 month of accrued interest on a 4 year, 12%, 12,000 promissory note payable. How much interest expense should be accrued? a. $1440 b. $2160 c. $720 d. $1080

720

#13 A customer's check for $25 that had been deposited into the company's checking account the previous month was returned stamped "NSF" by the bank. Which of the following journal entries is required? a.Cash25Accounts Receivable 25 b.Accounts Receivable25Cash 25 c.Account Receivable25Petty Cash 25 d.Cash25Accounts Payable 25

Accounts Receivable25 Cash 25

8. Which of the following entries properly closes temporary account? a Income Summary $400 Salary expense $400 b. Dividends $200 Retained earnings $200 c. Accumulated depreciation $1600 Income Summary $1600 d. Income summary $20,000 Service Revenue $20,000

Income Summary400 Salaries Expense400

#20. The company received a promissory note on March 1, 2019.The principal amount of the note is $20,000: the terms are 3 months and 9% annual interest. Refer to the information for accent flooring. At the maturity date, the customer pays the amount due for the note and the interest. What entry is required on the Books of Accent Flooring on the maturity date assuming that none of the interest had already been recognized? a. increase cash by $20,450, increase Notes Receivable by $20,000, and increase interest revenue $450 b. increase cash by $20,450, increase interest revenue by $450, decrease Notes Receivable by $20,000 c. increase cash and decrease Notes Receivable by $20,000 d. no entries required; the customer pays the amount due to Accent Flooring

Increase Cash by $20,450, increase Interest Revenue by $450, and decrease Notes Receivable by $20,000

#7. Failure to record the earned portion of unearned revenue would result in which of the following? a. no effect on total liability b. net income being understated c. total assets being understated d. stock holders equity being overstated

Net income being understated.

#18. The college store accepts mastercard for payment of purchases made by students. The credit card drafts are deposited directly in a bank account. Mastercard charges a 1.55% collection fee credit card drafts totaling $10,000 are deposited during in August recording the sales and deposits in an increase in a. accounts receivable for $9854 b. service charge expense for $155 c. cash for $10,000 d. sales for $9854

Service Charge Expense for $155

#6. The asset account, supplies, has a balance of $10,000 on January 1st. During January, $22,000 of supplies were purchased on the account and the liability was approximately recorded. A count of supplies at the end of January indicates a balance of $2000. What adjusting entry is necessary at January 31st? a. supplies $22,000 Accounts payable $22,000 b. supplies expense $22,000 supplies $20,000 accounts payable $2,000 c. supplies expense $30,000 supplies $30,000 d. supplies expense $ 24,000 supplies $24,000

Supplies Expense: 22,000 Supplies: 20,000 Accounts Payable: 2,000

#9. Each of the following items is considered a cash equivalent except a. a 30 day certificate of deposit b. a 75 day U.S. Treasury Bill c. a 60 day corporate commercial paper d. a 180 day note issued by local government

a 180-day note issued by a local government.

#10. Which of the following items would be added to the companies cash balance on a bank reconciliation? a. deposit in transit b. bank service charges c. outstanding checks d. interest earned on the bank account

interest earned on the bank account

#5. Which of the following adjusting entries involves the cash amount? a. accrued expenses b. deferred revenues c. deferred liabilities d. none of these choices are correct

none