managerial accounting cumulative quiz questions

Bob Stein's hourly wage is $45.00, and he worked 42 hours during the week. Assuming an overtime rate of time and a half over 40 hours, Bob's gross pay is:

$1,935

Strawberry Supreme purchased new baking equipment for $17,000 subject to a discount of 3%. The discount was taken. Additional costs included sales tax $700, installation of $500 and insurance for the first year of $1,000. The total cost to be added to the equipment account is:

$17,690

Harvest Moon Company has total assets of $20,000. If $2,000 cash is used to purchase a new computer, the total assets would be:

$20,000.

Nittany Company purchased a machine at an invoice cost of $25,000 subject to a discount of 3%. The discount was taken. Additional costs were installation of $1000, freight of $500 and insurance on the machine after it was placed in operation of $500. The total cost to be captialized to the machinery account is:

$25,750

Bob Love earned $126,400 prior to the payroll period ending June 15. For the current payroll, Bob Love earned $5,000 and has the following deductions: FICA-OASDI (with a limit of $128,400), FICA-Medicare; federal income tax of $300; and state income tax $40. What is his net pay?

$4,463.50

Vanessa's Gymnastics' cash register tapes do not agree with cash receipts. The facts are: total cash register tapes $400; total coins and currency $404. The summary journal entry to record the day's transactions would include a:

$404 debit to Cash; $4 credit to Cash Short and Over; and $400 credit to Service Revenue

What would the book value be at the end of year 6 for a piece of equipment using the straight-line method when cost is $11,000, residual value is $1,000, and the expected life is 10 years?

$5,000

Lacy purchased equipment for $76,000 on January 1. Its residual value is $4,000 with a useful life of 8 years. The amount of depreciation expense each year under the straight-line method is:

$9,000

What would the book value be at the end of year 5 for a piece of equipment using the straight-line method when cost is $16,000, residual value is $2,000, and the expected life is 10 years?

$9,000

If the balance of food inventory at the start of the month was $24,700 and at the end of the month you had $21,500 on hand, the adjusting entries for Food Inventory/Food Expense would be:

.credit to Food Inventory for $3,200; debit to Food Expense for $3,200

Robert purchased a truck for $30,000 with a life expectancy of 5 years; using straight-line depreciation, what would the book value of the truck be at the end of the first year?

24,000

An employee has gross earnings of $1,200 with withholdings of 6.2% FICA-OASDI, 1.45% FICA-Medicare, $50 for federal income tax and $10 for state income tax. How much is the net pay?

A. $791.15 B. $781.15 C. $900.00 D. $1,048.20 D. $1,048.20

Internal control over a company's assets should include the following procedures:

A. All cash receipts will be deposited into the bank the same day they arrive. B.All cash payments will be made by check (except petty cash). C.Responsibilities and duties of employees will be divided. D.All of these answers are correct. D. all answers are correct

If the employee has $800 withheld from their check for federal income tax, what is the amount that the employer would need to pay for their portion of the federal income tax?

A.$0 B.$400 C.$800 D.$100 A.$0

Dave Brown's cumulative earnings are $127,200, and his gross pay for the week is $5,300. If the FICA rates are: Social Security 6.2% and Medicare is 1.45%, what are his FICA-OASDI and FICA-Medicare taxes for the week? Assume the Social Security threshhold is $128,400.

A.$328.60; $76.85 B.$74.40; $76.85 C.$74.40; $17.40 D.$0; $76.85 B.$74.40; $76.85

The May bank statement for legal services shows a balance of $6,000, but the book balance shows a cash balance of $7,680. Other information includes: 1. A check for $200 to pay the electric bill was recorded on the books as $20 2. Included on the bank statement was a note collected by the bank for $400 plus interest of $30 3. Checks outstanding totaled $260 4. Bank service charges were $50 5. Deposits in transit were $2,140 The adjusted cash balance at the end of May should be:

A.$7,880 B.$7,620 C.$9,810 D.$7,150 A.$7,880

An account that would be increased by a credit is:

Accounts Payable.

A check deposited for $646 is incorrectly accounted for as $464. The error should be shown on the bank reconciliation as:

Added to the balance per books

Which of the following groups of accounts have a normal debit balance?

Assets, expenses, and withdrawals

The May bank statement for Rental shows a balance of $6,300, but the balance per books shows a cash balance of $7,980. Other information includes:1. A check for $200 to pay the electric bill was recorded on the books as $20. 2. Included on the bank statement was a note collected by the bank for $400 plus interest of $30. 3. Checks outstanding totaled $260. 4. Bank service charges were $50. 5. Deposits in transit were $2,140. Which item(s) will require a journal entry to update the balance in the Cash account?

Bank service charges, note collected by the bank, and error made by Accounting Services

On July 10, a customer of Delight's Restaurant paid the restaurant $500 as a partial payment toward a catering event held in June. The journal entry on July 10th to record this transaction is:

Debit Cash; Credit Accounts Receivable

You started the month with $100 in petty cash fund and at the end of the month you have cash of $20 and valid receipts for food expenses of $40. The entry to replenish the fund would be:

Debit Food Expense $40; Debit Over/Short $40; Credit Cash $80

Both employees and employers pay which of the following taxes?

FICA taxes (OASDI and Medicare)

Which of the following is a non-depreciable asset?

Land

What type of an account is Wages and Salaries Payable?

Liability

Which of the following items are on both the income statement and the statement of owner's equity?

Net Income

The May bank statement for Consulting Services shows a balance of $7300, but the balance per books shows a cash balance of $8,980. Other information includes:1. A check for $200 to pay the electric bill was recorded on the books as $20.2. Included on the bank statement was a note collected by the bank for $400 plus interest of $30.3. Checks outstanding totaled $260.4. Bank service charges were $50.5. Deposits in transit were $2,140.Which item should be subtracted from bank balance during the bank reconciliation?

Outstanding check

Happy Valley Catering prepaid rent of $36,000 on January 1, 2019 for the following year. The Journal Entry for rent for each month during 2018 would be:

Prepaid Rent, credit $3,000; Rent Expense, debit $3,000

Which of the following accounts would NOT appear on the Balance Sheet?

Rent Expense

The beginning balance in the Capital account would appear on which financial statement?

Statement of Owner's Equity

Which of the following transactions would cause an asset to decrease and the owner's equity to decrease?

The owner withdrew cash from the business

The employer's total FICA, SUTA and FUTA tax is recorded as:

a debit to Payroll Tax Expense

The employer's total FICA, SUTA, and FUTA tax is accounted for as:

a debit to Payroll Tax Expense

The bank statement included bank charges. On the bank reconciliation, this item is:

a deduction from the balance per company books.

If a company's revenues are higher than its expenses, it will cause:

an increase in owner's equity.

The employer records deductions from the employee's paycheck:

as credits to liability accounts until paid.

You meant to debit an asset account but posted it to an expense account by mistake. This would cause:

assets to be lower than they should be.

If the Prepaid Insurance account is NOT adjusted:

assets will be overstated and expenses will be understated.

Expenditures for changing oil in a machine or a car would be:

charged to an expense account

The correct journal entry to record the payment of FUTA to the Federal Government is to:

debit FUTA Payable; credit Cash.

The beginning balance for the month in the Equipment account was $3,000. The company purchased an additional $1000 worth of Equipment during the month. The ending balance in the account is:

debit of $4,000.

Greetings Online disposed of a van for $4,000 with an original cost of $22,000 with accumulated depreciation of $15,000. The journal entry would include a:

debit to Loss on Disposal of Plant Asset $3,000

A $100 petty cash fund has cash of $20 and valid receipts for $40. The entry to replenish the fund would include a:

debit to Over/Short for $40.

Mark paid $500 cash to partially reduce the amount owed for equipment that was previously bought on account. This transaction would:

decrease both assets and liabilities.

Sam's catering made a payment via check for $64 but it is incorrectly recorded on the books as $46. The $18 error should be shown on the bank reconciliation as:

deducted from the balance per books.

The account for Payroll Tax Expense includes all of the following except:

federal income tax

The number of allowances claimed by an employee determines how much will be withheld from their paycheck for:

federal income tax.

Outstanding checks:

have not been processed by the bank for payment but have been subtracted in the checkbook.

Net income or net loss is calculated on the:

income statement

Katelyn purchased $10,000 of new electronic equipment for her DJ Company on account. The effect on the basic accounting equation was to:

increase Equipment $10,000 and increase Accounts Payable $10,000.

A credit to a liability account was posted to the capital account. This would cause:

liabilities to be understated.

A dishwasher that originally cost $5,000 has no estimated salvage value and was depreciated over 5 years (straight-line depreciation). At the end of the second year, it was sold for $2,500 cash. The transaction would result in a:

loss of $500

If beginning capital was $150,000, ending capital is $180,000, and the owner's withdrawals were $15,000, the amount of net income or net loss was:

net income of $45,000.

As Withdrawals increase:

owner's equity decreases.

Which of the following accounts would NOT appear on the Balance Sheet?

rent expense

A gain on the sale of an asset occurs when:

the cash received is greater than the book value of the asset.

The debit amount to Payroll Tax Expense represents:

the employer's portion of the payroll taxes

The depreciation of equipment will require an adjustment that results in:

total assets decreasing and total expenses increasing.