ACC-240 quiz 3

all of the following are qualities of useful information except

flexibility

at December 1, 2017, orear company's accounts receivable balance was 16,800. During December orear had credit sales at 45,000 and collected accounts receivable of 36000. At december 31, 2017 the accounts receivable is

$25,000

the Mac company has four plants nationwide that cost $50 million. The current fair value of the plants is $400 million. The plants will be reported as assets at

$350 million

on January 1, 2017, M. Johnson company purchased equipment for 54000. the company is depreciating the equipment at the rate of 750 per month. the book value of the equipment at december 31, 2017 is

45000

powers corparation received a cash advance of 500 from a customer. as a result of this event

assets increased by 500

if a company issues common stock for 40000 and uses 30000 of the cash to purchase a truck

assets will increased by 40000

otto's tune-up shop follows the revenue principle. ottos service a car on august 31. the customer picks up the vehicle on September 1 and mails the payment to otto on september 5. Otto receives the check in the mail on September 6. when should otto show that the revenue was recognized

august 31

Accounting information is relevant to business decisions when it

confirms prior expectations

on april 1, 2017, npropel corporation paid 48,000 cash for equipment that will be used in business operations. the equipment be used for four years. npropel records depreciation expense of 48000 for the calendar year ending december 31, 2017. which accounting principle has been violated?

expense recognition principle

the expense recognition principle matches

expenses with revenues

in order for accounting information to be relevant, it must

help predict future events or confirm prior expectations

baden industries borrows 20000 at 7% annual interest for six months on october 1 2017 which is the approprate adjustment to accrue interest if baden employs on december 31 2017 fiscal year.

increase interest expense 350; increase interest payable 350

the purchase of an assets on credit

increased assets and liabilities

boyce company purchased office supplies costing 7000, and increased supplies for the full amount. at the end at the accounting period, a physical count of office supplies revealed 1800 still on hand. the appropriate adjustment to be made at the end of the period would be

increased supplies expense, 5200, decrease supplies, 5200.

collection of a $900 account receivable

increases an assets $900; decreased an assets $900

which of the following items has no effect on retained earnings

land purchase

Adjustments would not be necessary if financial statement were prepared to reflect net income from

lifetime operations

on march 1 2017 freeze company hires a new employee who will start to work on march 6. the employee will be paid on the last day of each month. has an accounting transaction occurred on march 6? why or why not?

no hiring an employee is an important event however it is not an accounting transaction

A payment of a portion of an account payable will

not affect stockholders equity

the primary difference between prepaid and accrued expenses is that prepaid expenses have

not been recorded and accrued expenses have.

goods purchased for future uses in the business, such as supplies are called:

prepaid expenses

if an individual assets is increased, then

there could be an equal decreased in another assets

information is ________ if independent parties, using the same methods, obtain similar results

verifiable