final exam 1

Use present value tables to compute the present value of $600,000 to be paid in 10 years, with an interest rate of 10 percent. (Future Value of $1, Present Value of $1, Future Value Annuity of $1, Present Value Annuity of $1) (Use appropriate factor(s) from the tables provided. Round "Present Value" to nearest whole dollar amount.)

Future Value of $1 $600000 n=10 i=10% $231326

Which of the following is merchandise inventory? Multiple Choice Office supplies that a company plans to use in the next few months Goods held for sale in the normal course of business Equipment used to manufacture products which will be sold later Raw materials and work in process

Goods held for sale in the normal course of business

Which of the following items would not be considered a long-lived asset? Multiple Choice Buildings Inventory Land Land improvements

Inventory

Obligations due to be paid within one year or the company's operating cycle, whichever is longer, are classified as: Multiple Choice noncurrent liabilities. current liabilities. current assets. earned revenues.

current liabilities

Ordinary repairs and maintenance: Multiple Choice are part of the asset cost of equipment and facilities. improve the asset beyond the current accounting period. are recorded as expenses. are always recorded as liabilities.

are recorded as expenses

A company issues 1 million shares of common stock with a par value of $0.13 for $16.10 a share. The entry to record this transaction includes a debit to Cash for: Multiple Choice $130,000, a debit to Capital Receivable for $15,970,000, a credit to Common Stock for $130,000, and a credit to Additional Paid-in Capital for $15,970,000. $130,000 and a credit to Common Stock for $130,000. $16,100,000 and a credit to Common Stock for $16,100,000. $16,100,000, a credit to Common Stock for $130,000, and a credit to Additional Paid-in Capital for $15,970,000

$130,000, and a credit to Additional Paid-in Capital for $15,970,000

Seasons has sales of $59,000, beginning inventory of $7,500, purchases of $34,000, and ending inventory of $3,000. The cost of goods sold is: Multiple Choice $41,500. $23,500. $38,500. $34,500.

$38,500.

Avalon Industries buys equipment for $48,000, expects to use it for ten years, and then sell it for $6,000. Using the straight-line method, the company should report annual depreciation for the equipment of: Multiple Choice $9,600. $4,200. $8,400. $4,800.

$4,200.

Kelton Inc. reported net credit sales of $450,000 for the current year. The unadjusted credit balance in its Allowance for Doubtful Accounts is $875. The company has experienced bad debt losses of 1% of credit sales in prior periods. Using the percentage of credit sales method, what amount should the company record as an estimate of Bad Debt Expense? Multiple Choice $2,625 $3,500 $4,500 $5,375

$5,375

Jackson Manufacturing Company had a beginning inventory of $19,500. During the year, the company recorded inventory purchases of $90,000 and cost of goods sold of $59,000. The ending inventory must equal: Multiple Choice $31,500. $50,500. $29,500. $30,500.

$50,500.

Your company sells $50,000 of one-year, 10% bonds for an issue price of $52,000. The journal entry to record this transaction will include a credit to Bonds Payable in the amount of:$50,000. $52,000. $57,000. $55,000.

50,000

AAA Co. uses a periodic inventory system and has the following information in regard to its inventory: Beginning inventory 200 units @ 19 $ 3,800 Purchase on January 25 300 units @ 20 6,000 Purchase on March 15 200 units @ 21 4,200 Purchase on October 2 400 units @ 22 8,800 Goods available for sale $ 22,800 There are 550 units in ending inventory. What is the amount of the ending inventory using the FIFO method? Multiple Choice $9,800 $11,950 $8,800 $3,800

?$9,800?

Which of the following must be paid by both the employee and the employer? Multiple Choice Federal unemployment tax State unemployment tax State withholding tax FICA taxes

?FICA taxes?

A retailer is a company that buys products from manufacturers and sells them to wholesalers. Group starts True or False

True

Bonds allow a company to borrow large sums of money from many different investors. starts True or False

True

Treasury stock is a corporation's own stock that has been issued and subsequently repurchased by the corporation. Group starts True or False

True

When a company routinely sells on credit, it is inevitable that some of its customers will not pay the amount owed. Group starts True or False

True

The Discount on Bonds Payable account is reported in the financial statements as: Multiple Choice a reduction from the Bond Payable account on the balance sheet. an asset on the balance sheet. an expense on the income statement. revenue on the income statement.

a reduction from the Bond Payable account on the balance sheet

The LIFO inventory cost flow assumes that the cost of the newest goods purchased are: Multiple Choice assumed to be the last ones to be sold. assumed to be the first ones sold. not included in cost of goods sold or ending inventory. assumed to be the first ones included ending inventory.

assumed to be the last ones to be sold