accounting2

Roberto Designers was organized on January 1, 2021. The firm was authorized to issue 180,000 shares of $5 par value common stock. During 2021, Roberto had the following transactions relating to stockholders' equity:Issued 18,000 shares of common stock at $7 per share.Issued 36,000 shares of common stock at $8 per share.Reported a net income of $180,000.Paid dividends of $90,000.Purchased 4,500 shares of treasury stock at $10 (part of the 36,000 shares issued at $8).What is total stockholders' equity at the end of 2021?

$459,000. Common Stock (at par) (54,000 × $5)$270,000 Additional paid-in capital (18,000 × $2) + (36,000 × $3) 144,000 Net income 180,000 Dividends (90,000) Treasury stock (4,500 × $10) (45,000) $459,000

The following information was taken from a company's bank reconciliation at the end of the year: Bank balance$8,800Checks outstanding$7,500Note collected by the bank$1,800Service fee$35Deposits outstanding$5,700NSF check$370 What is the correct cash balance that should be reported in the company's balance sheet at the end of the year?

$7,000. Bank balance ($8,800) + deposits outstanding ($5,700) − checks outstanding ($7,500) = $7,000.

Clothing Emporium was organized on January 1, 2021. The firm was authorized to issue 170,000 shares of $7 par value common stock. During 2021, Clothing Emporium had the following transactions relating to stockholders' equity:Issued 51,000 shares of common stock at $9 per share.Issued 34,000 shares of common stock at $10 per share.Reported a net income of $170,000.Paid dividends of $85,000. What is total paid-in capital at the end of 2021?

$799,000. [(51,000 × $9) + (34,000 × $10)] = $799,000.

Treasury Stock is normally reported as:

A reduction of total stockholders' equity.

When preparing a bank reconciliation, a deposit outstanding would be:

Added to the bank's cash balance.

The Sarbanes-Oxley Act (SOX) mandates which of the following? Increased regulations related to auditor-client relations. Increased regulations related to internal control. Increased regulations related to corporate executive accountability. All of the other answers represent mandates of the Sarbanes-Oxley Act.

All of the other answers represent mandates of the Sarbanes-Oxley Act.

The financial statement that represents the accounting equation is the:

Balance Sheet

Which of the following is considered cash for financial reporting purposes?

Checks received from customers.

South Beach Apparel issued 11,000 shares of $2 par value stock for $10 per share. What is true about the journal entry to record the issuance?

Credit Additional Paid-In Capital $88,000 11,000x2=22,000 11,000x10=110,000 110,000-22,000=88,000

During the year, Cheng Company paid salaries of $22,700. In addition, $8,600 in salaries has accrued by the end of the year but has not been paid. The year-end adjusting entry would include which one of the following? Multiple Choice

Credit to salaries payable for $8,600

Liabilities normally carry a _______ balance and are shown in the ______________.

Credit; Balance sheet

On September 1, 2021, Gold Gaming sold 400 one-year subscriptions to its online gaming website for $90 each. The total amount received was credited to Deferred Revenue. What would be the required adjusting entry at December 31, 2021?

Debit Deferred Revenue and credit Service Revenue for $12,000. $90/12 months = $7.50 per month. $7.50 × 4 months × 400 subscriptions = $12,000.

After preparing the bank reconciliation, an NSF check would result in which of the following when recording the adjustment to the company's cash balance?

Debit to Accounts Receivable.

Journal entries to record cash dividends are made on the:

Declaration date and payment date.

An expense has what effect on the accounting equation?

Decrease stockholders' equity.

The statement of stockholders' equity shows:

How each equity account changed over time.

Purchasing office supplies on account will:

Increase assets and increase liabilities.

Separation of duties refers to:

Individuals who have physical responsibility for assets should not also have access to accounting records.

Retained Earnings represent a company's:

Net income less dividends since the company first began operations.

Keeping supplies in a locked room with access allowed only to authorized personnel is an example of which preventive control?

Physical controls

Financial accounting does not deal with which of the following? Measuring a company's economic activity. Providing information to internal users. Preparing financial reports. Communicating financial results to investors.

Providing information to internal users.

Which of the following does not represent a major provision of the Sarbanes-Oxley Act? Quarterly financial statements. Nonaudit services. Auditor rotation. Corporate executive accountability.

Quarterly financial statements.

Which of the following accounts has a debit balance? Accounts Payable. Deferred Revenue. Service revenue Salaries Expense.

Salaries Expense.

Of the following six accounts, which ones have temporary balances: (1) Service Revenue (2) Dividends (3) Salaries Expense (4) Common Stock (5) Retained Earnings (6) Cash

Service Revenue, dividends, salaries expense

Limited liability means:

Stockholders of a corporation are not obligated to pay the corporation's debts out of their own pocket.

The stockholders' interest in a corporation is called:

Stockholders' equity.

A company received a utility bill of $690 but did not pay it. Indicate the amount of increases and decreases in the accounting equation.

assets = liabilities + stockholders equity $0 = $690 + $-690

Which of the following is not a balance sheet item? Assets. Retained earnings expenses liabilities

expenses

A customer purchased a drill press on November 14 on account from Sears. The drill press was delivered two weeks later. The customer paid for the drill press on December 5. When should Sears record the revenue for this transaction according to the revenue recognition principle?

november

Which of the following would increase assets and increase liabilities? Provide services to customers on account. Purchase office supplies on account. Pay dividends to stockholders. Receive a utility bill for the current month. Plan to pay bill beginning of next month.

purchase supplies on account

Current liabilities are liabilities due within one year.

true

For financial reporting purposes, we typically recognize expenses in the same period as the revenues they help to generate.

true