ACCOUNTING FINAL

The amount of CPP to be deducted from an employee with earnings this week of $800 and cumulative earnings for the year has reached its max would be A) $762.63. B) $37.06. C) $0.00. D) $37.37.

$0.00

Fred's Footwear started with $7,000 in Inventory and had the following transaction totals for the month of April: Sales$20,000 Sales Returns and Allowances2,000 Cost of Goods Sold8,000 Purchases14,000 Freight1,000 Purchases Returns and Allow.2,000 Purchases Discounts??? If ending Inventory for the period is $11,000, what is the total of purchase discounts experienced?

$1,000

On March 30, Francine's Bakery purchased $1,000, plus 13% HST, of merchandise on account from Smithers Company. The goods were shipped F.O.B. shipping point. The freight charge of $80 (includes HST) was paid by Smithers Company and added to the invoice. The amount to record in the Inventory account is

$1,080

On March 30, Francine's Bakery purchased $1,000, plus 13% HST, of merchandise on account from Smithers Company. The goods were shipped F.O.B. shipping point. The freight charge of $80 (includes HST) was paid by Smithers Company and added to the invoice. The amount to record in the Accounts Payable account is

$1,210

If the employees had $250 CPP, $350 EI and $450 Income Tax deducted from their paycheques, then the total amount to be remitted to the Receiver General would be

$1,790.

Inventory shrinkage is $100. The income statement debit and credit columns of the worksheet total $2,500 and $2,500, respectively, not including the adjustment amounts for shrinkage. The net income or loss for the period is

$100 net loss

What is the threshold at which employers would be required to send in their remittance more often than monthly?

$15,000

Hardware Restoration had a purchase of $40,000, a purchase return of $10,000, and a purchase discount of $1,500. What is the impact on Inventory?

$28,500

If the employees' CPP deductions for the week total $300, the employer's CPP contribution will be

$300

R&R Lumber reports a purchases of $40,000, a purchase return of $6,000, and a purchase discount of $1,500. What is the impact on Inventory?

$32,500

On February 12, Clare purchased $350 of merchandise on account from Larsen's Accessories, terms 2/10, n/30. The goods were shipped F.O.B. destination. The freight charge was $40. The amount to be recorded in the Accounts Payable Subsidiary ledger is

$350

The amount of CPP to be deducted from an employee with earnings this week of $800 and cumulative earnings for the year of $21,000 would be A) $37.62 B) $37.37. C) $762.63 D) $798.01.

$37.37

Jackson purchased $400 of goods and received credit terms of 2/10, n/30. How much did he pay if payment was made during the discount period?

$392

Jackson purchased $400 of goods on Feb 8 and received credit terms of 2/10, n/30. How much did he pay if payment was made on Feb 21?

$400

If the employees' EI deductions for the week total $300, the employer's EI contribution will be

$420

Kim received $1,780 for working 40 regular hours. What was Kim's rate of pay per hour? A) $45.00 B) $40.00 C) $44.50 D) $44.00

$44.50

Georgia Ally's hourly rate is $10.00, and she worked 44 hours during the week. Assuming an overtime rate of time and a half over 40 hours, Georgia's gross pay is A) $460. B) $400. C) $350. D) $430.

$460

What is the price of the merchandise if the list price is $800, trade discount is 40%, and the terms are 2/10, EOM?

$480

Susie's Shoes had a purchase of $6,000, freight charges of $150, a purchase return of $750, and a purchase discount of $225. What is the impact on Inventory?

$5,175

Barnie's Cafe started with $4,000 in Inventory and had the following transaction totals for the month: Sales$10,000 Sales Returns and Allowances1,000 Cost of Goods Sold$4,000 Accounts Payable5,500 Purchases7,000 Purchases Returns and Allowances1,000 Purchases Discounts700 Net purchases for the period are

$5,300

If the employees' CPP deductions for the week total $500, the employer's CPP contribution will be

$500

Valerie Chandler works 46 hours as a coffee barista and earns $12 per hour. Compute her weekly pay assuming an overtime (more than 40 hours) rate of 1.5. A) $624 B) $588 C) $480 D) $552

$588

If the employees have had $200 in CPP contributions and $300 in EI contributions deducted from their paycheques, then the Employer's Benefits Expense would be

$620

On June 15, the Greater Gravel Company purchased $700 of merchandise on account from the Digga Ditch Company, terms 4/10, n/30. The goods were shipped F.O.B. shipping point. The freight charge of $40 was paid by Digga Ditch Company and added to the invoice. The amount to record in the Inventory account is

$740

Blue's Tax Service has two types of employees, management and clerical support. The company estimates that it will pay the clerical support $240,000 next year and the managers $315,000. For every $100, the company pays $0.14 into the workers' compensation insurance. Calculate the amount of worker's compensation insurance.

$777

Todd earns an hourly rate of $20 and had taxes, CPP, and EI withheld totaling $200. What would his net earnings be if he worked 46 hours (assuming double time over 40 hours)? A) $860 B) $720 C) $840 D) $780

$840

Francis works 44 hours at a rate of pay of $20 per hour. He receives double pay over 40 hours. What is his gross pay? A) $900 B) $880 C) $960 D) $800

$960

Bob Hill's hourly rate is $25.00, and he worked 39 regular hours during the week. What is his gross pay for the week? A) $1,000 B) $950 C) $780 D) $975

$975

If Sheila worked 8 hours a day for a total of 40 hours this week, how many hours of overtime will Sheila earn? Assume that she normally works 5 days at 8 hours a day in her regular work schedule. A) 1 B) 5 C) 9 D) 0

0

The employer pays EI premiums in what ratio to employee EI deductions?

1.4 times employee EI deductions

Credit terms of 2/10, n/30 mean that

2% discount is allowed if the bill is paid within 15 days, or the entire amount is due within 30 days

If Sheila worked 12 hours on Tuesday and 5 hours on Wednesday this week, how many hours of overtime will Sheila earn if overtime is more than 8 hours a day?

4

The entry to adjust for Inventory Shrinkage includes

A credit to Inventory

The basic concept of the quick method of accounting for GST/HST is best described as follows:

A smaller company will remit about as much tax as they would if detailed records were maintained.

A credit memorandum decreases which account on the seller's books?

Accounts Receivable

Capital Assets includes which of the following?

Accumulated Depreciation on office machines

The payroll register does NOT contain

All cumulative payroll information for each individual employee

The actual tax Bram pays for the year will be affected by A) any deductible tuition he has paid. B) the amount of earnings he makes from all sources. C) his charitable donations made. D) All of the above.

All of the above

A pay period is defined as A) weekly. B) monthly. C) bi-weekly. D) All of the above are correct.

All of the above are correct

Workers' compensation A) is based on the total estimated payroll. B) is paid for by the employer. C) insures employees against losses they may incur due to injury or death while on the job. D) All of the above are correct.

All of the above are correct

Prepaid Worker's Compensation Insurance is what type of account?

Asset

The payroll register A) shows all employee information related to an entire pay period. B) is a worksheet. C) keeps track of an individual employee's payroll history for a calendar year. D) Both A and B are correct.

Both A and B are correct

The law requires all employees to complete and sign TD1 exemption forms A) at the beginning of employment. B) every year. C) whenever there is a change in circumstances. D) both A and C are correct.

Both A and C are correct

The employee earnings record A) shows all employee information related to an entire pay period. B) keeps track of an individual employee's payroll history for a calendar year. C) is one of two primary records used to track payroll information. D) Both B and C are correct.

Both B and C are correct.

Employment Insurance premiums are paid by

Both the employer and the employee

Which of the following is an amount paid by both employee and employer?

CPP & EI

Which of the following is a law that has no effect on payroll net earnings?

Canada Savings Bond

Which of the following accounts will appear on the post-closing trial balance?

Capital

The special journal used to record all transactions involving payment of cash is a

Cash Payments journal

Which of the following is an optional payroll deduction?

Charitable Contributions

The physical count of inventory was incorrect which overstated the ending inventory. This would cause

Cost of Goods Sold to be understated

The normal balance of the accounts receivable subsidiary ledger is

Debit

Unlimited Materials sold goods for $1,800 plus 5% GST to a charge customer, terms n/30. Which entry is required to record this transaction (exclude the entry to Cost of Goods Sold and Inventory)?

Debit Accounts Receivable for $1,890; credit GST Payable $90 and credit Sales for $1,800

Lanny's Levers sold 50 levers at $45.00 each to a customer on account, terms 2/15, n/30. The levers cost Lanny's $20.00 each. Which entry is required to record the sale portion of this transaction?

Debit Accounts Receivable for $2,250; credit Tile Sales for $2,250

Flat Tire Company sold tires to a charge customer, including PST and GST. What entry is required to record this transaction?

Debit Accounts Receivable, credit Sales, credit GST Payable, credit PST Payable, Debit Cost of Goods Sold, Credit Inventory

Cynthia's Crystals sold $1,000 worth of crystal plus 5% GST and 8% PST to a charge customer with terms 2/10, n/30. The invoice was paid within terms. The entry to record receipt of payment is

Debit Cash $1,110, debit Cash Discounts $20, credit Accounts Receivable $1,130.

Singh Company received payment in full within the credit period for goods sold for $400 plus 13% HST. Terms of the sale were n/30. Which entry records this transaction?

Debit Cash, $452, credit Accounts Receivable, $452

Joe received $4,000 in advance for renting part of his building. What is the entry to record the receipt of payment?

Debit Cash; credit Unearned Rent

How is Income Summary closed if the company had a net income?

Debit Income Summary; credit Capital

The employer pays employee Income Tax premiums in what ratio to employee deductions?

Does not contribute

What does a check mark in the PR column of a journal indicate?

During the month the subsidiary ledger is updated.

The journal entry to record the EHT amount owing for the year is

Employer Health Tax Expense Employer Health Tax Payable

The journal entry to record the payment of the EHT liability for the year is

Employer Health Tax Payable Cash

The term used when the seller is responsible for the cost of freight is

F.O.B. destination.

The term used when the purchaser is responsible for the cost of freight is

F.O.B. shipping point.

The forms T4 and T4-T4A Summary must be submitted to the employees and Federal Government respectively by

February 28 of the year following.

Employers must send employees their T4 by

February 28th.

The liability account used to record GST owed is

GST Payable.

Net Sales + Sales Discounts + Sales Returns and Allowances equals

Gross Sales

The liability account used to record HST owed is

HST payable

If gross profit exceeds expenses, the company

Had a net income

Workers' compensation provides insurance for employees who are A) unemployed due to an economic downturn. B) unemployed due to a plant closing. C) not paid enough. D) injured while on the job.

Injured while on the job

The credit that a company receives for the GST/HST it pays is called

Input Tax Credit.

What type of account is CPP Payable?

Liability

What type of an account is Wages and Salaries Payable?

Liability

An employer might agree to pay a portion of the following items to which the employees contribute.

Medical plan

Payment discounts received on merchandise purchased for resale under the perpetual inventory method are subtracted from

Merchandise Inventory

Sales discounts are NOT taken on which of the following?

Merchandise returned, HST added, and Freight

Which amount is not directly found on the worksheet?

Net Sales

The ending merchandise inventory was overstated. This error would cause

Net income to be overstated

Gross pay is the same as

Pay before deductions

What inventory method is used when the inventory balance is updated only at the end of the accounting period?

Periodic

Which of the following is NOT a main type of Special Journal?

Personnel Journal

Which of the following is an operating expense?

Postage Expense, and Salaries Expense

The journal entry to record the estimated advance premium payment for workers' compensation is

Prepaid Insurance, Workers' Compensation Cash

Which account is not used with a perpetual inventory system?

Purchase Returns and Allowances

The value of inventory includes

Purchases + Freight - Purchases Discount - Purchases Returns and Allowances

Which special journal is used to record merchandise or other items bought on account?

Purchases Journal

Which of the following not a statutory payroll deduction?

Registered Retirement Savings Plans

Gross Earnings are the same as

Regular earnings only

gross profit is

Sales revenue less cost of goods sold

The form that contains information about gross earnings given to each employee by February 28 of the year following is the

T4

The form used to determine an employee's net claim code is called a

TD1

Which of the following statements about subsidiary ledgers is most accurate?

The accounts receivable subsidiary ledger is a book of accounts that provides supporting detail for Accounts Receivable.

The Balance Sheet columns on a worksheet have subtotals as follows debit column, $1,000, and credit column, $900. This indicates that

The company earned a net income of $100

The information needed to make the journal entries to record the wages and salaries expense comes from

The payroll register

What liability account is reduced when the employees are paid?

Wages and Salaries Expense

The T4 Summary form is filed:

With the T4's

Which of the following accounts will NOT appear on the post-closing trial balance?

Withdrawals

As the Prepaid Workers Compensation is recognized, the amount will transfer to

Workers Compensation Insurance Expense.

The main reason most businesses do not use only a General Journal is

a General Journal is much too inefficient and two or more clerks cannot use the General Journal at the same time

The normal balance of the HST Collected is

a credit

Bruno's Fashions bought 60 nose-rings for $20 each on account. The invoice included $60 GST (5%) and payment terms of 2/10, n/30. Ten nose-rings were returned prior to payment. The entry to record the payment (within the discount period) would include

a credit to Cash for $1,030

Sold merchandise subject to GST, accepting cash. This will be recorded with

a credit to a liability account.

A customer returned merchandise for credit. This will be recorded with

a credit to an asset account

A customer returned merchandise having already paid for it within the cash discount period. The return will be recorded with

a credit to an asset account

Received payment, within the discount period, for merchandise sold previously. This will be recorded with

a credit to an asset account.

An entry for a purchase return will include

a credit to inventory

Bruce's Jewelry bought 50 rings for $10 each on account. The invoice included 13% HST and payment terms of 2/10, n/30. In addition, five rings were later returned prior to payment. The entry to record the return would include

a credit to inventory for $50.00

The normal balance for inventory is

a debit

The normal balance of the Sales Returns and Allowances account is

a debit

Sue's Jewelry sold 25 necklaces for $25 each to a credit customer. The cost of the necklaces to Sue's Jewelry was $15 plus 5% GST. The invoice included a 6% provincial sales tax, 5% GST, and payment terms of 2/10, n/30. Five necklaces were returned prior to payment. The entry to record the original sale would include

a debit to Accounts Receivable for $693.75

Sue's Jewelry sold 25 necklaces for $25 each to a credit customer. The cost of the necklaces to Sue's Jewelry was $15 plus 13% HST. The invoice included HST at 13% and payment terms of 2/10, n/30. Five necklaces were returned prior to payment. The entry to record the return would include

a debit to Sales Returns and Allowances for $125.00.

Purchased office supplies on account. This will be recorded with

a debit to Supplies and a credit to Accounts Payable.

The closing entry for the $700 balance of Wages Expense includes

a debit to income summary for $700

Bruce's Jewelry bought 50 rings for $10 each on account. The invoice included 13% HST and payment terms of 2/10, n/30. In addition, five rings were later returned prior to payment. The entry to record the original purchase would include

a debit to inventory for $500.00

If a credit memorandum is issued, what account will be increased on the seller's books?

accounts receivable

A record showing the activity and the balances owed by each customer is called the

accounts receivable subsidiary ledger

As supplies are used, they become

an expense

Adjusting entries from the worksheet

are journalized and posted to the ledger

Owner's Capital would be found on the worksheet in the

balance sheet credit column.

F.O.B Shipping point means

buyer pays for freight and the title passes at time of shipment

Current assets are

cash and other assets that will be converted or consumed during the normal operating cycle of the company or one year, whichever is longer

When a customer pays an account, the transaction would be recorded in the

cash receipt journal

When using a subsidiary ledger, the Accounts Payable account in the general ledger is called the

controlling account

When using a subsidiary ledger, the Accounts Receivable account in the general ledger is called the

controlling account

Sales discounts are usually allowed only on

credit sales to customers

The entry to record a purchase of $2,000 on account, terms of 2/10, n/30, would include a

credit to Accounts Payable for $2,000.

recording to the accounts receivable ledger is done

daily

When remitting CPP, the entry would be

debit CPP Payable, credit Cash.

Fong returned $200 of merchandise within the discount period. The entry to record the return is

debit to Accounts Payable for $200, credit Inventory for $200.

The entry to record a payment on a $500 account within the 2% discount period would include a

debit to Accounts Payable for $500

Tyler returned $400 of merchandise within the discount period. The entry to record the return is to

debit to Accounts Payable/Suppliers Name for $400; credit Inventory for $400.

Depreciation on equipment was recorded twice this period. This would cause

expenses to be overstated and total assets to be understated

The term F.O.B. means

free on board

A debit memo for the return of merchandise is usually recorded in the

general journal

The principal ledger containing all the balance sheet and income statement accounts is the

general ledger

The 'entry' to record payment of statutory payroll deductions is generally recorded first in the

general or cash payments journal.

The Wages and Salaries Expense account would be used to record

gross earnings for the office workers.

All payroll registers include sections for recording

gross pay, deductions and net pay.

Interest Expense is

has a normal debit balance, a cost of borrowing money, and included in the "Other Expenses" on the income statement

a trade discount would

have no effect on the books

In addition to CPP and EI, employers often share the expense of

health care plans.

Sales would be found on the worksheet in the

income statement credit column.

The employer's remittance to CRA includes

income tax, CPP, and EI

The automatic increase of claim amounts that account for inflation is called

indexing

a credit memorandum is sent to a customer for the purpose of

informing the customer an amount has been deducted from their account.

Workers' Compensation Insurance

insures employees against losses due to workplace injury or death.

Canada's tax legislation allows the use of the quick method of accounting for GST/HST because

it wants to simplify tax handling for some smaller companies.

Provincial Sales Tax Payable is a

liability account with a credit balance

Harmonized Sales Tax Payable is a

liability account with a credit balance.

The accounts payable subsidiary ledger

lists accounts with which the company does business on a regular basis, lists accounts alphabetically, and has a controlling account in the general ledger

The T4 Summary

must equal the total of the year's T4 Forms.

Office Supplies (not used for resale) bought on account were returned for credit and recorded with a debit to Accounts Payable and a credit to Cost of Goods Sold. This error will cause

net income to be overstated

A merchandise company's interest expense is a(n)

other expense

the purchases journal is used for

recording purchases on account.

customer returns of product in new condition

reduce cost of goods sold and increase inventory

The contra-revenue accounts include

sales discounts, returns, and allowances

When merchandise is sold on account, it is usually recorded in the

sales journal

Which account is used by management to keep track of possible customer dissatisfaction?

sales returns and allowances

A TD1 Form:

specifies the claim code for each employee.

Accounts of a single type (i.e., Accounts Receivable) are kept in this form of ledger.

subsidiary ledger

Accounts of a single type are kept in this ledger.

subsidiary ledger.

To calculate gross profit,

subtract cost of goods sold from net sales.

The financial statement on which Unearned Rent would appear is

the balance sheet

The balance sheet columns on the worksheet prepared for Boston Foods had subtotals as follows: debit column, $11,000, and credit column, $10,400. This information indicates that

the company incurred a net income of $600

The income statement columns on a worksheet have subtotals as follows: debit column, $9,500, and credit column, $9,000. This indicates that

the company incurred a net loss of $500

The return of merchandise by a credit customer was recorded with a debit to Accounts Payable and a credit to Accounts Receivable and the subsidiary ledger. This error will cause

the net income for the period to be overstated.

The collection of an invoice for $5,000 plus HST of 13% within the 2/10 n/30 discount period was recorded using a 3% discount rather than a 2% discount in both the controlling and subsidiary accounts. This error will cause

the net income for the period to be understated.

A sales discount correctly taken by the charge customer was debited to Sales at the time the entry was recorded. This error will cause

the sales to be overstated

cost of goods sold is

total cost of merchandise sold during the period

Discounts which reduce the price for customers who buy items for resale or to produce other goods are

trade discounts

Personal Income Tax rates

vary from province to province.