Accounting Final

A company reports net accounts receivable of $ 152 comma 000$152,000 on its December​ 31, 2019 balance sheet. The Allowance for Bad Debts has a credit balance of $16,000. What is the balance of Accounts​ Receivable?

$168,000

What do you include on the "Book Side"

- bank collections - electronic funds transfer - service charge - interest revenue - nsf check

What do you include on the "Bank side"

- deposits in transit - outstanding checks - bank errors

What are the three way under allowance method in which they estimate?

1. % of sales 2. % of receivables 3. aging of receivables

If at the end of the accounting period the liabilities total $18,000, and equity totals $32,000, then what must be the total of the assets?

50,000

Assets total $100,000 and liabilities total $20,000. What is the equity of the business? A) $80 B) $800 C) $8,000 D) $80,000 E) None of the above

80,000

When a business buys supplies on account assets a) increase b) ncrease and liabilities decrease c) decrease d) decrease and liabilities increase

A

Beginning inventory 15 units @ $6 per unit, First purchase 30 units @ $7 per unit First sale 25 units Second purchase 35 units @ $8 per unit Second sale 40 units Third purchase 20 units @ $9 per unit What is the value of the ending inventory using a perpetual inventory system with the LIFO costing method? A) $270 B) $285 C) $300 D) $490 E) None of the above

A) $270

An account titled Prepaid Rent would be classified as which of the following? A) Asset account B) Liability account C) Revenue account D) Expense account E) None of the above

A) Asset account

How do you get the balance of a T Account??

Add the right side Add the left side Then subtract the two totals and put the balance on the debit(left) side.

Accounting Equation

Assets = Liabilities + Owner's Equity

Before the closing process is performed at the end of the accounting period, revenues and expenses should have which of the following? A) A balance of zero B) Balances of cumulative amounts of activity during the period C) A net balance (credits minus debits) equal to the capital account D) A net balance equal to assets minus liabilities E) None of the above

B

The bookkeeper recorded a bank deposit at $960, but the bank recorded the deposit at its correct amount of $690. How will this error be treated on the bank reconciliation? A) Addition per bank statement balance B) Deduction per book balance of cash C) Addition per book balance of cash D) Deduction per bank statement balance E) None of the above

B

When cash is received from a customer in payment for an account receivable, how are the elements of the accounting equation affected? A) Decrease assets (cash and increase assets (accounts receivable) B) Increase assets (cash) and decrease assets (accounts receivable) C) Increase assets and increase liabilities D) Increase assets and increase equity E) None of the above

B) Increase assets(cash) and decrease assets(Accounts receivable)

When prices are rising over time, which of the following inventory costing methods will result in the lowest gross margin? A) FIFO B) LIFO C) Weighted Average D) Cannot be determined E) None of the above

B) LIFO

FOB Shipping Point means that the A) Good are placed free on board to the buyer's place of business B) Buyer pays the freight C) Seller pays the freight D) The trucking company pays the freight E) None of the above

B) buyer pays the freight

The total assets and total liabilities of a firm are reported on which of the following? A) Income statement B) Balance sheet C) Statement of cash flows D) Statement of owner's equity E) None of the above

Balance Sheet

Beginning inventory 15 units @ $6 per unit, First purchase 30 units @ $7 per unit , First sale 25 units Second purchase 35 units @ $8 per unit Second sale 40 units Third purchase 20 units @ $9 per unit What is the value of the ending inventory using a perpetual inventory system with the FIFO costing method? A) $270 B) $275 C) $300 D) $460 E) None of the above

C

At the end of the accounting period, the business had $4,500 of office supplies on hand. At the beginning of the period, the amount of supplies on hand was $3,000. If the business purchased $12,000 of office supplies during the year, what amount of office supplies were used during year? A) $16,500 B) $14,250 C) $10,500 D) $ 9,750 E) None of the above

C) $10,500

An item of merchandise with a list price of $200 was purchased with a trade discount of 40% and credit terms of 3/10, n/30. The vendor was paid within the discount period. From the buyer's standpoint, which is the correct journal entry to record the payment? A) Accounts Payable, debit, $200.00; Purchases Discount, credit, $86.00; Cash, credit, $114.00 B) Accounts Payable, debit, $80.00; Merchandise Inventory, credit, $2.40; Cash, credit, $77.60 C) Accounts Payable, debit, $120.00; Merchandise Inventory, credit, $3.60; Cash, credit, $116.40 D) Purchases, debit, $200.00; Purchase Discount, credit, $86.00; Cash, credit, $114.00 E) None of the above

C) Accounts Payable, debit, $120.00; Merchandise Inventory, credit, $3.60; Cash, credit, $116.40

Purchasing equipment on account will have what effect on the components of the accounting equation? A) Increase in equipment and a decrease in equity B) Increase in equipment and an increase in equity C) Increase in equipment and an increase in liabilities D) Increase in equipment and a decrease in liabilities E) None of the above

C) increase in equipment and an increase in liabilites

The interest on a $12,800, 6%, 150-day note is closest to which amount? A) $3,200.00 B) $32.00 C) $13,120.00 D) $320.00

D

Which of the following is a limitation of the direct​ write-off method of accounting for​ uncollectible? A. The direct​ write-off method overstates assets on the balance sheet. B.The direct​ write-off method does not match expenses against revenue very well. C. The direct​ write-off method does not set up an allowance for uncollectible. D.All of the above

D

The records for Uptown Pet Shop showed the following:Sales $225,000 Beginning merchandise inventory $ 30,000 Purchases 135,000 Cost of goods sold 150,000 What was the ending merchandise inventory? A) $120,000 B) $ 75,000 C) $ 45,000 D) $ 15,000 E) None of the above

D) $15,000

Cash $15,000 Accounts Receivable 35,000 Supplies 4,000 Prepaid Insurance 3,000 Other Prepaids 1,000 Equipment 65,000 Buildings 140,000 Land 40,000 Patents 10,000 Accounts Payable $15,000 Notes Payable 25,000 Mortgage Payable 85,000 Capital, Mary Ling 195,000 Withdrawals, Mary Ling 22,000 Revenues 190,000 Salaries Expense 73,000 Rent Expense 65,000 Utilities Expense 37,000 Assuming all of the accounts have normal balances, what is the total of the trial balance? A) $532,000 B) $508,000 C) $488,000 D) $510,000 E) Does not balance

D) $510,000

Phillip Atwood received $5,000 after he completed excavation work for a local home builder. Recording the transaction requires which of the following? A) An asset to be debited, a liability to be credited B) A liability to be debited, an asset to be credited C) Withdrawal to be debited, an asset to be credited D) An asset to be debited, revenue to be credited E) An option other than these provided

D) an asset to be debited, revenue to be credited

Which of the following accounts is a temporary account? A) Accounts Payable B) Unearned Revenue C) Capital, Lola Delong D) Withdrawals E) Office Equipment

D) withdrawls

When you purchase merchandise inventory on account what is the journal entry?

Debit to merchandise inventory Credit to accounts payable

Normal Balances

Debits= Dividends, Expenses, Assets Credits= Liabilities, Equity, Revenues, and Common Stock

Which of the following is a purpose of an internal control system? A) To promote efficient operations B) To urge adherence to company policies C) To protect assets. D) To ensure reliable accounting E) All of the above

E

Which of the following is a type of adjusting journal entry? A) Prepaid (Deferred) expenses. B) Unearned (Deferred) revenues. C) Accrued revenues. D) Accrued expenses. E) All of the above

E) all of the above

How do you do target balance??

Ending balance of accounts receivable X %

When prices are rising, which of the following will result in the highest amount of income tax expense? A) LIFO B) Weighted average C) FIFO D) None of the above E) Not enough information is given

FIFO

How do you close out income summary??

Income Summary X Retained Earnings. X

When is bad debts expense recorded?

Only at December 31st

How do you compute the amount of interest

Principal X interest rate X time

What is a trial balance?

a list of accounts and their balances at a given time

Total assets are $22,000.00. Supplies are bought on account for $1,500.00. The total assets are now ____. a.$22,000.00 b..$23,500 c.$20,500.00 d.$25,000.00

b

What is the formula for cost of goods sold?

beginning inventory + purchases - ending inventory

What are temporary accounts?

revenues, expenses, dividends, and income summary