ACT 211 Test 1

Use the following information for Meeker Corporation to determine the amount of equity to report. Cash$ 63,000 Buildings 121,500 Land 202,000 Liabilities 127,000

$259,500

If assets are $395,000 and equity is $135,000, then liabilities are:

$260,000

A company reported total equity of $149,000 at the beginning of the year. The company reported $214,000 in revenues and $167,000 in expenses for the year. Liabilities at the end of the year totaled $94,000. What are the total assets of the company at the end of the year?

$290,000 Assets = Liabilities + Equity Assets = $94,000 + (Beginning Equity + Revenues − Expenses) Assets = $94,000 + ($149,000 + $214,000 − $167,000) Assets = $94,000 + $196,000; Assets = $290,000

Zinc has beginning equity of $273,000, total revenues of $73,000, and total expenses of $48,000. The company has no other transactions impacting equity. Its ending equity is

$298,000.

Use the following information as of December 31 to determine equity Cash $71,000 Buildings 189,000 Equipment 220,000 Liabilities 155,000

$325,000

Darden has beginning equity of $290,000, total revenues of $76,000, and total expenses of $38,000. The company has no other transactions impacting equity. The company's ending equity is:

$328,000.

On August 31 of the current year, the assets and liabilities of Gladstone, Incorporated are as follows: Cash $31,050; Supplies, $690; Equipment, $10,800; Accounts Payable, $9,500. What is the amount of equity as of August 31 of the current year?

$33,040

During the month of February, Rubio Services had cash receipts of $8,400 and cash payments of $10,400. The February 28 cash balance was $3,600. What was the February 1 beginning cash balance?

$5,600.

The assets of a company total $708,000; the liabilities, $204,000. What is the amount of equity?

$504,000

On April 30, Gomez Services had an Accounts Receivable balance of $22,400. During the month of May, total credits to Accounts Receivable were $56,800 from customer payments. The May 31 Accounts Receivable balance was $17,000. What was the amount of credit sales during May?

$51,400.

If equity is $329,000 and liabilities are $189,000, then assets equal

$518,000

Zippy had cash inflows from operating activities of $78,500; cash outflows from investing activities of $63,000; and cash inflows from financing activities of $41,000. The net change in cash was

$56,500 increase Net Change in Cash = Cash Flows from Operating Activities + Cash Flows from Investing Activities + Cash Flows from Financing Activities Inflows (+) Outflows (-)

At the beginning of January of the current year, Sorrel Company's ledger reflected a normal balance of $66,000 for accounts receivable. During January, the company collected $17,600 from customers on account and provided additional services to customers on account totaling $13,900. Additionally, during January one customer paid Mikey $6,400 for services to be provided in the future. At the end of January, the balance in the accounts receivable account should be:

$62,300.

If assets are $103,000 and liabilities are $34,500, then equity equals:

$68,500

A company's balance sheet shows cash of $37,000, accounts receivable of $43,000, equipment of $76,000, and equity of $85,000. What is the amount of liabilities?

$71,000

During the month of March, Harley's Computer Services made purchases on account totaling $44,900. Also, during the month of March, Harley was paid $10,100 by a customer for services to be provided in the future and paid $37,600 of cash on its accounts payable balance. If the balance in the accounts payable account at the beginning of March was $78,000, what is the balance in accounts payable at the end of March?

$85,300.

Doc's Ribhouse had beginning equity of $64,000; net income of $23,000. The company has no other transactions impacting equity. Calculate the ending equity.

$87,000

A company's balance sheet shows: Cash $40,000, Accounts receivable $25,000, Office equipment $59,000, and Accounts payable $26,000. What is the amount of total equity

$98,000

Speedy Company has net income of $38,955, and assets at the beginning of the year of $220,000. Assets at the end of the year total $266,000. Compute its return on assets. HINT AFTER ADDING ASSETS TOGETHER DIVIDE BY TWO

16.0%

Chou Company has a net income of $47,000, assets at the beginning of the year are $254,000 and assets at the end of the year are $304,000. Compute its return on assets.

16.8%

Cage Company had net income of $353 million and average total assets of $2,010 million. Its return on assets (ROA) is:

17.6%

Jennings Company has total assets of $463 million. Its total liabilities are $129.5 million. Its equity is $333.5 million. Calculate the debt ratio.

28.0%.

Sanders Company has total assets of $425 million. Its total liabilities are $120.1 million, and its equity is $304.9 million. Calculate its debt ratio

28.3%.

On May 31, the Cash account of Tesla had a normal balance of $5,100. During May, the account was debited for a total of $12,300 and credited for a total of $11,600. What was the balance in the Cash account at the beginning of May?

A $4,400 debit balance

On January 1 of the current year, Jimmy's Sandwich Company reported total equity of $129,500. During the current year, total revenues were $109,000, while total expenses were $118,500. No other changes in equity occurred during the year. The change in total equity during the year was:

A decrease of $9,500.

Saddleback Company paid off $36,000 of its accounts payable in cash. What would be the effects of this transaction on the accounting equation?

Assets decrease $36,000; liabilities decrease $36,000

If a company receives $10,800 from a client for services provided, the effect on the accounting equation would be:

Assets increase $10,800 and equity increases $10,800.

If a company purchases equipment costing $3,600 on credit, the effect on the accounting equation would be:

Assets increase $3,600 and liabilities increase $3,600.

Echo Company has assets of $612,000, liabilities of $256,000, and equity of $356,000. It buys office equipment on credit for $81,000. What would be the effects of this transaction on the accounting equation?

Assets increase by $81,000 and liabilities increase by $81,000

If the liabilities of a company increased $96,000 during a period of time and equity in the company decreased $30,000 during the same period, what was the effect on the assets?

Assets would have increased $66,000

Received $970 cash for services provided to a customer during July. Collected $3,400 cash for services previously completed in June. Received $820 from a customer in partial payment of his account receivable which arose from sales in June. Provided services to a customer on credit, $445. Borrowed $6,700 from the bank by signing a promissory note. Received $1,320 cash from a customer for services to be performed next year.

$1,415.

Nexis had beginning equity of $79,000; revenues of $111,000, and expenses of $81,700. The company had no other transactions impacting equity. Calculate the ending equity

$108,300 Ending Equity = Beginning Equity + Revenues − Expenses

If assets are $319,000 and liabilities are $190,000, then equity equals:

$129,000

A company is considering purchasing a parcel of land that was originally acquired by the seller for $94,000. While the land is currently offered for sale at $168,000, it is considered by the purchaser as easily being worth $158,000, and is finally purchased for $155,000, the land should be recorded in the purchaser's books at:

$155,000

Determine the net income of a company for which the following information is available for the month of July Employee salaries expense $ 199,000 Interest expense 29,000 Rent expense 39,000 Consulting revenue 476

$209,000 Net Income= Revenues - expenses

Charlie's Chocolates' has accounts receivable of $60,000 and accounts payable of $25,000. The company has revenues of $93,000 and expenses of $69,000. Calculate its net income

$24,000

On May 31 of the current year, the assets and liabilities of Riser, Incorporated are as follows: Cash $13,800; Accounts Receivable, $6,900; Supplies, $650; Equipment, $11,450; Accounts Payable, $8,800. What is the amount of equity as of May 31 of the current year?

$24,000

At the end of its first month of operations, a company reported Revenue of $38,200. It also reported Wages Expense, $6,400; Rent Expense, $5,400; and Utilities Expense, $1,200. Calculate net income reported on the income statement at month-end.

$25,200

A $28 credit to Revenue was posted as a $280 credit. By what amount is the Revenue account in error?

$252 overstated.

A law firm billed a client $2,000 for work performed in the current month. Which of the following general journal entries will the firm make to record this transaction?

Debit Accounts Receivable, $2,000; credit Services Revenue, $2,000.

Alicia Tax Services paid $540 to settle an account payable. Which of the following general journal entries will Alicia Tax Services make to record this transaction

Debit Accounts payable, $540; credit Cash, $540

Edison Consulting received a $370 utilities bill and immediately paid it. Edison's general journal entry to record this transaction will include a:

Debit to Utilities Expense for $370.

If Dallas Company billed a client for $15,000 of consulting work completed, the accounts receivable asset increases by $15,000 and:

Revenue increases $15,000

A $330 credit to Supplies was credited to Revenue by mistake. By what amounts are the accounts under- or overstated as a result of this error?

Supplies, overstated $330; Revenue, overstated $330.

The credit purchase of a new oven for $5,400 was posted to Kitchen Equipment as a $5,400 debit and to Accounts Payable as a $5,400 debit. What effect would this error have on the trial balance?

The total of the Debit column of the trial balance will exceed the total of the Credit column by $10,800.

Cruz Company had revenues of $104,000 and expenses of $62,000 for the year. Its assets at the beginning of the year were $412,000. At the end of the year, assets were worth $462,000. Calculate its return on assets.

9.6% NI= revenues-expenses

Flitter reported net income of $26,000 for the past year. At the beginning of the year the company had $217,000 in assets and $67,000 in liabilities. By year end, assets had increased to $317,000 and liabilities were $92,000. Calculate its return on assets:

9.7%

At the beginning of the current year, Snell Company's total assets were $251,400 and its total liabilities were $172,500. During the year, the company reported total revenues of $93,000 and total expenses of $81,000. There were no other changes in total equity during the year, and total assets at the end of the year were $263,400. The company's debt ratio at the end of the current year is:

65.5%.

At the end of the current year, James Company reported total liabilities of $305,000 and total equity of $105,000. The company's debt ratio was:

74.4%.

Rush Company had net income of $169 million and average total assets of $1,870 million. Its return on assets (ROA) is

9.0%

GreenLawn Company provides landscaping services to clients. On May 1, a customer paid GreenLawn $66,000 for 6-months services in advance. GreenLawn's general journal entry to record this transaction will include a:

Credit to Unearned Revenue for $66,000

A company receives $8,100 cash for performing landscaping services. Which of the following general journal entries will the company make to record this transaction?

Debit Cash $8,100; credit Landscaping Revenue, $8,100

A law firm collected $2,500 on account for work performed and billed in the previous month. Which of the following general journal entries will the firm make to record this collection of cash?

Debit Cash, $2,500; credit Accounts Receivable, $2,500.

A law firm collected $3,200 in advance for work to be performed in three months. Which of the following general journal entries will the firm make to record this transaction?

Debit Cash, $3,200; credit Unearned Revenue, $3,200.

Green Cleaning purchased $580 of office supplies on credit. The company's policy is to initially record prepaid and unearned items in balance sheet accounts. Which of the following general journal entries will Green Cleaning make to record this transaction?

Debit Office supplies, $580; credit Accounts payable, $580

A company purchased $20,200 of supplies on credit. The journal entry to record this transaction consists of a:

Debit Supplies for $20,200; credit Accounts Payable for $20,200

If the assets of a business increased $123,000 during a period of time and its liabilities increased $84,000 during the same period, equity in the business must have:

Increased $39,000

If the liabilities of a business increased $85,000 during a period of time and equity in the business decreased $35,000 during the same period, the assets of the business must have:

Increased $50,000.

If a company uses $1,580 of its cash to purchase supplies, the effect on the accounting equation would be:

One asset increases $1,580 and another asset decreases $1,580, causing no effect.

At year-end, a trial balance showed total credits exceeding total debits by $5,400. This difference could have been caused by:

The balance of $6,040 in the Office Equipment account being mistakenly entered on the trial balance as a debit of $640.

Identify the item below that would cause the trial balance to not balance?

The cash payment of a $1,030 account payable was posted as a debit to Accounts Payable and a debit to Cash for $1,030.