gateway problems pratice

Soprano Design Services issued a $10,000 four-year, 5% bond on January 1, 2007. The bond interest is paid each December 31. Assume that Soprano's bonds were sold at an issue price of $8,415 to yield 10% interest. What will be the carrying value of the bonds after the first interest payment?

$ 8,757

Dexter Inc. issued a $1,000,000 10-year, 10% bond on January 1, 2015 and pay interest semiannually. What is the issue price of the bond and is it issued at a discount, premium, or face value if the market rate is 8%?

$1,135,907 Premium

nventory records for Marvin Company revealed the following: Date Transaction Number of Units Unit Cost Total Cost Mar. 1 Beginning inventory 2,000 $1 2,000 Mar. 10 Purchase 1,200 2 2,400 Mar. 16 Purchase 1,600 3 4,800 Mar. 23 Purchase 1,200 4 4,800 Total 6,000 14,000 Marvin sold 4,600 units of inventory during the month. The ending inventory assuming LIFO would be:

$1,400.

Walker Co. uses the LIFO inventory method. On January 1, of the current year, Walker had 50 units of inventory that had cost $20 per unit. On January 15, Walker purchased additional 100 units of inventory for $10 per unit. On January 20, Walker purchased 25 units of inventory for $5 per unit. During January, Walker sold 150 units for $20 per unit. What is Walker's cost of goods sold for January?

$1,625

Church Corp., a newly formed corporation, recently sold 1,000 shares of its $10 par value stock for $30,000. Assuming there have been no other stock sales to date, what balance should Church Corp. report as "Common Stock" on its balance sheet?

$10,000

The beginning balance in retained earnings for the year is $100,000 for Riddick Company. Riddick had a net loss for the year of $5,500 and an ending balance in retained earnings of $84,500. What amount of dividends did Riddick pay for the year?

$10,000

Soprano Design Services issued a $10,000 four-year, 5% bond on January 1, 2007. The bond interest is paid each December 31. Assume that Soprano's bonds were sold to yield 4%. What will be the total issue price? From the present value of $1 table, if n=4 and i = 5%, 0.8227; if n=4 and i = 4%, 0.8548 From the present value of annuity of $1 table, if n=4 and i = 5%, 3.5460; if n=4 and i = 4%, 3.6299

$10,363

On October 1, Angel Investigations loans Cordelia $100,000 and accepted a 5%, 10-month note from Cordelia. How much is the total amount Cordelia will pay back to Angel Investigations (the maturity value of the note)?

$104,167

GreatWhiteShark Company will open a new store on January 1. Based on experience from its other retail outlets, GreatWhiteShark Company is making the following sales projections. Cash Sales Credit Sale January $80,000 $95,000 February $40,000 $60,000 March $75,000 $55,000 April $50,000 $90,000 GreatWhiteShark Company estimates that 65% of the credit sales will be collected in the month following the month of sale with the balance (the remaining 35%) collected in the second month following the month of sale. (January credit sales will be collected in February and March, February credit sales will be collected in March and April, etc.) How much total cash will be collected in the month of April?

$106,750

The following information pertains to Julia & Co.: March 1. Beginning inventory = 30 units @ $5 March 3. Purchased 15 units @ $4 March 9. Sold 25 units @ $8 What is the cost of goods sold for Julia & Co. assuming it uses LIFO?

$110

Fifth Element borrowed $25,000 to purchase a work vehicle by agreeing to a 6% 4-year loan with the bank. Payments of $587.13 are due at the end of each month, with the first installment due on January 31, 2015. What will the interest expense be for the first payment on January 31, 2015?

$125

Consider the following costs: Direct materials $63,000 Depreciation on factory equipment $22,000 Factory janitor's salary $13,000 Direct labor $18,000 Factory utilities $ 9,000 Selling expenses $16,000 Factory supervisor salary $84,000 Administrative expenses $21,000 What is the total amount of manufacturing overhead included above?

$128,000

Cutter Enterprises purchased equipment for $72,000 on January 1, 2010. The equipment is expected to have a five-year life, with a residual value of $6,000 at the end of five years. Using the straight-line method, depreciation expense for 2011 and the book value at December 31, 2011 would be:

$13,200 and $45,600.

On January 1, 2007 Elliott Medical Supplies, Inc. received cash by signing a note payable for $200,000. The note carries an interest rate of 9% and equal payments of $79,011 are due each December 31. After Elliott makes the first payment of $79,011 on December 31, 2007 what will the balance be in the "Notes Payable" account?

$138,989

Baker Fine Foods has beginning inventory for the year of $12,000. During the year, Baker purchases inventory for $150,000 and ends the year with $20,000 of inventory. Baker will report cost of goods sold equal to:

$142,000

Eve's Apples opened business on January 1, 2010, and paid for two insurance policies effective that date. One insurance policy was $36,000 for eighteen-months, and the crop damage policy was $12,000 for a two-year term. What was the balance in Eve's prepaid insurance as of December 31, 2010?

$18,000.

Izzo Manufacturing produces two types of cameras: 35mm and digital. The cameras are produced using one continuous process. Four activities have been identified: machining, setups, receiving, and packing. Resource drivers have been used to assign costs to each activity. The overhead activities, their costs, and the other related data are as follows. Product Machine Hours Setups Receiving Orders Packing Orders 35mm 10,000 100 200 400 Digital 10,000 250 800 2,000 Costs $60,000 $40,000 $8,000 $24,000 Calculate the total overhead assigned to the 35mm cameras using packing orders to calculate a plantwide rate.

$22,000

Daryl Inc. purchased machinery on January 1 of 2014 for $50,000, which has an expected useful life of 5 years and a residual value of $2,000. What would be the accumulated depreciation on June 30, 2016 if Dexter uses straight-line depreciation?

$24,000

The following table contains financial information for Fast & Furious, Inc. before closing entries: Cash $6,000 Supplies $1,000 Prepaid Rent $2,500 Salary Expense $3,000 Equipment $25,000 Service Revenue $30,000 Other Expenses $15,000 Dividends $1,500 Accounts Payable $4,000 Capital Stock $20,000 How must will be included in Long term assets?

$25,000

Curtis Enterprises purchased equipment for $144,000 on January 1, 2010. The equipment is expected to have a five-year life, with a residual value of $12,000 at the end of five years. Using the straight-line method, depreciation expense for 2011 and the book value at December 31, 2011 would be:

$26,400 and $91,200.

On January 1, 2007 Elliott Medical Supplies, Inc. received cash by signing a note payable for $400,000. The note carries an interest rate of 9% and equal payments of $158,022 are due each December 31. After Elliott makes the first payment of $158,022 on December 31, 2007 what will the balance be in the "Notes Payable" account?

$277,978

VIN, Inc. has an ending retained earnings balance of $5,000. If during the year VIN paid dividends of $500 and had net income of $2,000, then what was the beginning retained earnings balance?

$3,500

On August 1st Terminus' Board of Directors declared a dividend for shareholders of record on August 15th. On August 31st, Terminus paid dividends of $50,000 to all shareholders. Terminus has 20,000, $1 par common shares outstanding and 10,000, 1%, $100 par cumulative preferred shares outstanding. Last year was the only year Fifth Element did not pay a dividend to shareholders. How much will the common shareholders receive?

$30,000

he following table contains financial information for Fast & Furious, Inc. before closing entries: Cash $6,000 Supplies $1,000 Prepaid Rent $2,500 Salary Expense $3,000 Equipment $25,000 Service Revenue $30,000 Other Expenses $15,000 Dividends $1,500 Accounts Payable $4,000 Capital Stock $20,000 What is the amount of total stockholder's equity?

$30,500

Kramer, Inc., manufactures a product that passes through two processes: mixing and molding. all manufacturing costs are added uniformly in the mixing department. Information for the mixing department for April follows: Work in process, April 1: Units (35% complete) 5,000 Direct materials $24,000 Direct labor $30,000 Overhead $10,000 During April, 25,000 units were completed and transferred to the molding department. The following costs were incurred by the mixing department during April: Direct materials $90,000 Direct labor $120,000 Overhead $30,000 By April 30, 2,500 units that were 80 percent complete remained in Mixing. Kramer uses the weighted average method. Kramer's total costs to account for would be:

$304,000

Escareno Corporation has provided its contribution format income statement for June. The company produces and sells a single product. Sales (8,400 units) $764,400 Variable expenses 445,200 Contribution margin 319,200 Fixed expenses 250,900 Net operating income $68,300 If the company sells 8,100 units, its total contribution margin should be closest to:

$307,800

Warden Company reflected the following balances in the stockholders' equity section at December 31, 2007: Common Stock, par $15, 30,000 shares outstanding; Preferred Stock, 6%, $100 par, 1,000 shares outstanding. Based on these terms, the preferred stock should receive dividends of $6 per share each year. Warden Co. has not paid any dividends since its formation on January 1, 2005. Assuming that the preferred stock is cumulative and Warden's pays $50,000 in dividends during the current year, how much will the common stockholders receive?

$32,000

As of December 31, of the current year, Shady Company had adjusted account balances in accounts receivable of $100,000 and $1,000 (debit) in the allowance for uncollectible accounts. Shady Company decided that the allowance for uncollectible accounts should be 3% of accounts receivable. Bad debt expense for the year should be:

$4,000

On September 1, 2010, Middelton Corp. issues cash and accepts a $1,000 note receivable that offers 12% interest and is due in six months. How much interest revenue will Middleton Corp report during 2010?

$40.

On April 1st, Saviors Industries paid $10,000 of insurance in advance for 18 months. What is the insurance expense (adjusting entry) for December of the current year?

$5,000

At December 31, Amy Jo's Appliances had adjusted account balances in accounts receivable of $311,000 and $970 (credit) in the allowance for uncollectible accounts. An analysis of Amy Jo's December 31 accounts receivable suggests that the allowance for uncollectible accounts should be 2% of accounts receivable. Bad debt expense for the year should be:

$5,250.

On November 1, Angel Investigations purchased land for $500,000. The following costs were also incurred at the time of purchase: (1) $5,000 of closing costs, (2) $10,000 of back taxes, (3) $2,000 in current year property taxes, (4) $25,000 for demolition of an old structure on the land, (5) $1,000 received for salvaged materials, and (6) $4,000 to level the land. All costs were paid in cash. What is the amount that should be recorded in the "Land" account?

$543,000

Fifth Element had a Net Loss of $5,000 and distributed dividends of $15,000. The ending balance in retained earnings was $36,000. What was the beginning balance in retained earnings?

$56,000

On March 1, Wright Company purchased new equipment for $50,000. Wright paid cash for the equipment. Other costs associated with the equipment were: transportation costs, $1,000; sales tax paid $3,000; and installation cost, $2,500. The cost recorded for the equipment was:

$56,500

On September 1, 2010, Floral co. signed an $200,000, 9%, six-month note payable with the amount borrowed plus accrued interest due six months later on March 1, 2011. Floral co. should report interest payable at December 31, 2010, in the amount of:

$6,000

On January 1, 2010, Future Farming Inc. purchases a tractor for $100,000, which has an expected useful life of 10 years and an estimated residual value of $5,000. What would the accumulated depreciation be on June 30, 2016, assuming Future Farming Inc. uses straight-line method for depreciation?

$61,750

On September 1 of the current year Walters Co. loaned $70,000 to a supplier and accepted a 3%, 6-month note from the supplier. How much interest receivable should Walters record with respect to this note on December 31, 2009?

$700

Panhandle Corporation was organized on January 3, 2010. The firm was authorized to issue 200,000 shares of $5 par common stock. During 2010, Panhandle had the following transactions relating to shareholders' equity: Issued 60,000 shares of common stock at $7 per share. Issued 40,000 shares of common stock at $8 per share. Reported a net income of $200,000. Paid dividends of $100,000. What is total Paid-in capital at the end of 2010?

$740,000.

"Receiving" unloaded 600 crates and processed 7,500 items through thte department in the last year. Receiving has three activities: unloading, counting goods, and inspecting. Unloading uses a forklift that is leased for $14,000 per year. The forklift is used only for unloading. The fuel for the forklift is $1,400 per year. Other operating costs (maintenance) for the forklift total $1,500. Inspection uses some special testing equipment that has a depreciation of $2,800 per year and an operating cost of $2,500. Receiving has three employees who have an average salary of $40,000 per year. The work distribution matrix for the receiving personnel is as follows. Activity % of Time on each activity Unloading 50 Counting 15 Inspecting 35 No other resources are used for these activities. What is the cost of the unloading activity?

$76,900

Bakeman Corporation has provided the following production and average cost data for two levels of monthly production volume. The company produces a single product. Production volume 2,000 units 3,000 units Direct materials $36.10/unit $36.10/unit Direct labor $48.00/unit $48.00/unit Manufacturing overhead $51.00/unit $40.90/unit The best estimate of the total variable manufacturing cost per unit is:

$84.10

Soprano Design Services issued a $10,000 four-year, 5% bond on January 1, 2007. The bond interest is paid each December 31. Assume that Soprano's bonds were sold to yield 6% (market interest rate). What will be the total issue price? From the present value of $1 table, if n=4 and i = 5%, 0.8227; if n=4 and i = 6%, 0.7921 From the present value of annuity of $1 table, if n=4 and i = 5%, 3.5460; if n=4 and i = 6%, 3.4651

$9,654

On March 3, Cobra Inc. purchased a desk for $450 on account. On March 22, Cobra purchased another desk for $500 also on account, and then on March 24, Cobra paid $400 on account. At the end of March, what amount should Cobra report for desks (assuming these two desks were the only desks they had)?

$950

Walker Enterprises accrued interest from a loan to another company of $1,000. This would be recorded as:

Debit Interest Receivable, credit Interest Revenue

ABO purchased a truck at the beginning of 2010 for $140,000. They sold the truck at the end of 2011 for $95,000. If the expected life of the truck was six years with a residual value of $20,000 and ABO uses straight-line depreciation, which of the following is true regarding the journal entry to record the sale of the truck?

Debit Loss 5k

Which of the following is a possible closing entry for Walker, Inc.?

Debit Retained Earnings, Credit Loss on Sale of Land

Carol, Inc. used up $500 of supplies during the year. The adjusting entry would be recorded as:

Debit Supplies Expense, credit Supplies

On September 27, 2009, Ichi Co., which uses a perpetual inventory system, purchased 100 units of Product W from Howard Co. for $7 per unit. On October 13, Ichi returned 5 units to Howard because they were defective. The journal entry to record this return would be:

Debit accounts payable and credit inventory.

On July 10, 2010, Cowboy Co., which uses a periodic inventory system, purchased 20 units from Pete Co. for $10 per unit. On October 13, Cowboy returned 15 units to Pete because they were defective. The journal entry Cowboy Co would record for this return would be:

Debit accounts payable and credit purchase returns.

Childers Service Company provides services to customers totaling $3,000, for which it billed the customers. How would the transaction be recorded?

Debit accounts receivable $3,000, credit service revenue $3,000.

Die Hard Company provides services to customers totaling $5,000, for which it billed the customers. How would the transaction be recorded?

Debit accounts receivable $5,000, credit service revenue $5,000.

A company received a bill for newspaper advertising services for the current period, $400. The bill will be paid in 10 days. How would the transaction be recorded today?

Debit advertising expense $400, credit accounts payable $400.

On January 2, 2009, Yoo Corporation, which uses a periodic inventory system, purchased 200 units of Product E for $14.49 per unit on account. Yoo expects to be able to sell 100 of these units within a week of their receipt. The journal entry that Yoo should make to record this purchase would be:

Debit purchases and credit accounts payable.

Credit sales are recorded as:

Debit revenues, credit accounts receivable.

At the beginning of December, Global Corporation had $1,000 in supplies on hand. During the month, supplies purchased amounted to $2,000, but by the end of the month the supplies balance was only $1,200. What is the appropriate month-end adjusting entry?

Debit supplies expense $1,800, credit supplies $1,800

Stark Industries had $10,000 supplies at the beginning of the year and purchased $5,000 additional supplies during the year. At the end of the year, there were $3,500 supplies on hand. What is the appropriate adjusting entry?

Debit supplies expense $11,500, credit supplies $11,500

When the Board of Directors declares a dividend, the resulting entry would include:

Debit to Dividends

On October 1, Governor Corp. loans Rick $50,000 and accepted an 8%, 6-month note from Rick. Assuming Rick pays the note in full on the due date, and Rick has a fiscal year end of December 31, the journal entry for Rick will include:

Debit to Interest Payable for $1,000

Re acquisition of common stock that was previously issued would result in:

Debit to Treasury Stock

If Willis Corp makes a sale in year 1 but provides the services in year two, what adjusting entry is required in Year 2 when services are rendered?

Debit unearned revenues, credit revenue.

On July 4th, Terminus Corp received $10,000 of services that they prepaid in the prior month. How does this transaction affect the accounting equation?

Decrease assets and decrease stockholders' equity.

Purchasing office supplies on account will:

Increase assets and increase liabilities.

During October, The Allen Corp received $20,000 in advance for managment fees to be completed in future years. How does this transaction affect the accounting equation?

Increase assets by $20,000 and increase liabilities by $20,000

On September 1, Morgan Lab Supplies purchased $30,000 in inventory on account. How does this transaction affect the accounting equation?

Increase assets by $30,000 and increase liabilities by $30,000

On January 1, Oceanic Airlines sold equipment with an original cost of $450,000 and accumulated depreciation of $300,000 for $200,000 cash. How does this transaction affect the accounting equation?

Increase assets by $50,000 and increase stockholders' equity by $50,000

Yummy Foods purchased a one-year hazard insurance policy on August 1 and recorded the $4,200 premium to prepaid insurance. At its December 31 year-end, Yummy Foods would record which of the following adjusting entries?

Insurance Expense dr 1750 prepaid insurance cr 1750

Dexter Inc. issued a bond on January first and created the following partial amortization schedule: Date Cash Paid Interest Expense Change in Carrying Value Carrying Value 1/1/15 $93,205 6/30/15 $3,500 $3,728 $228 $93,433 12/31/15 $3,500 $3,737 $237 $93,671 6/30/16 $3,500 $3,747 $247 $93,917 12/31/16 $3,500 $3,757 $257 $94,174 6/30/17 $3,500 $3,767 $267 $94,441 12/31/17 $3,500 $3,778 $278 $94,719 How much interest was paid to bondholders in 2016 and how much interest expense was recorded in 2016?

Interest expense of $7,504 and interest paid of $7,000

The following information pertains to Die Hard Enterprises: January 1 Die Hard purchases inventory January 10 Customer order products from Die Hard January 15 Die Hard sends an invoice to customer for products ordered January 20 Die Hard delivers products to customer January 25 Customer pays Die Hard for products What date does Die Hard recognize income from the sale under the accrual basis of accounting?

January 20

In December, Morgan Lab Supplies collected $10,000 in cash for sales from November. Assuming the November transaction was properly recorded, what net effect does the December collection have on the accounting equation?

No effect

When a stock split occurs, what is the effect on the accounting equation?

No effect

On January 1st, Avengers Corp. paid $5,000 for 5 months' rent in advance ($1,000/month). How does this transaction affect the accounting equation?

No effect.

Sam Company borrowed $1,000,000 on June 30th of the current year and signed an 18-month note bearing 10% interest. Interest is payable in full on November 30th of the following year, along with the principal. How much cash would Sam report on the December 31st adjusting journal entry of the current year?

None

An understatement of Yardley Co.'s 2009 beginning inventory would cause:

None of the other answers is correct.

On December 29, 2009, Innovator Co., purchased $3,200 of goods from Eagleton Co., FOB destination. The goods were shipped the following day and were received by Innovator on January 3, 2010. How should these goods appear on the December 31, 2010, balance sheets of Innovator and Eagleton respectively?

None on Innovator's balance sheet and all $3,200on Eagleton's balance sheet.

Arrow Printers paid $2,000 interest on short-term notes payable, $10,000 interest on long-term bonds, and $6,000 in dividends on its common stock. Arrow would report cash outflows from activities, as follows:

Operating, $12,000; financing $6,000.

The employees of Neat Clothes work Monday through Friday. Every other Friday the company issues payroll checks totaling $32,000. The current pay period ends on Friday, January 3. Neat Clothes is now preparing financial statements for the year ended December 31. What is the adjusting entry to record accrued salaries at the end of the year?

Salaries Expense dr: 22,400 Salaries Payable cr: 22,400

If a company has stockholders' equity of $100,000 at the end of the year, which of the following statements is always true?

The company's assets exceed liabilities by $100,000.

If a company has stockholders' equity of $60,000 at the end of the year, which of the following statements is always true?

The company's assets exceed liabilities by $60,000.

On September 1, 2010, Gold Magazine sold 600 one-year subscriptions for $90 each. The total amount received was credited to unearned subscriptions revenue. What would be the required adjusting entry at December 31, 2010?

Unearned subscription rev dr 18k subscription rev cr 18k

On July 1, 2009, Pearson Co. sold 60 cases of Product Zippy to Robertson Co. for $5 per case, terms 2/10, n/30. The goods had cost Pearson $5 per case. On July 5, 2009, Robertson returned 15 of the cases. Assuming Pearson uses a perpetual inventory system, the journal entry to record the return would include:

a debit to inventory of $75

Abbott Company purchased a computer that cost $10,000. It had an estimated useful life of 5 years and no residual value. The computer was depreciated by the straight-line method and was sold at the end of the fourth year of use for $3,000 cash. Abbott should record:

a gain of 1000

Rick Inc. purchases $10,000 of inventory with terms of 5/15, n/30 from Morgan Co. on June 1st on account. On June 10th, Rick pays the account to Morgan, in full. What is the journal entry using the periodic inventory method?

accounts payable 10000 purchase discount 500 cash 9500

Ramirez Mining Co. (RMC) issued callable bonds on January 1, 2010. RMC's accountant has projected the following amortization schedule from issuance until maturity: Date Cash Paid Interest Expense Increase in Carrying Value Carrying Value 1/1/10 $194,758 6/30/10 $7,000 $7,790 790 195,548 12/31/10 $7,000 $7,822 822 196,370 6/30/11 $7,000 $7,855 855 197,225 12/31/11 $7,000 $7,889 889 198,114 6/30/12 $7,000 $7,925 925 199,039 12/31/12 $7,000 $7,961 961 200,000 RMC issued the bonds:

at a discount

Under absorbtion costing, PRODUCT costs include: Fixed Manufacturing Overhead Variable Manufacturing Overhead Direct Materials Direct Labor 1. No No Yes Yes 2. No Yes Yes No 3. Yes Yes Yes Yes 4. No Yes No Yes

choice 3

Berwin Company had the following per unit costs for one if its products: Direct materials $4.50 Direct labor 3.10 Overhead 7.00 Sales Commission 1.00 Calculate the per unit prime cost per unit conversion cost. Prime Cost per unit Coversion Cost per unit 1. $14.60 $7.60 2. $10.10 $7.60 3. $4.50 $11.10 4. $7.60 $10.10

choice 4

Which of the following performancy measures will increase if the minimum required rate of return on an investment decreases? Return on Investment Residual Income a. Yes Yes b. No Yes c. Yes No d. No No

choice b

If Willis Corp assesses their supplies at the end of the period and discovers that the supplies present are less than amount of supplies currently listed in the account on the books, what type of adjusting entry should be made?

debit Supplies Expense, credit Supplies.

On January 1, Hilton company sold equipment with an original cost of $1,800,000 and accumulated depreciation of $1,200,000 for $800,000 cash. How does this transaction affect the accounting equation?

increase assets by 200k and increase SE by 200k

Kahn Company produces and sells 8,000 units of Product Zebra each year. Each unit of Product Zebra sells for $10 and has a contribution margin of $6. Kahn is considering dropping Product Zebra and wants to know what the effect will be on operating income. It is estimated that if Product Zebra is discontinued, $50,000 of the $60,000 in fixed costs charged to Product Zebra could be eliminated. These data indicate that if Product Zebra is discontinued, overall company operating income should:

increase by $2,000 per year

Cowboy Company purchased a two-year hazard insurance policy on July 1 and recorded the $3,600premium to prepaid insurance. At its December 31 year-end, Cowboy Company would record which of the following adjusting entries?

insurance expense dr 900 prepaid insurance cr 900

A company provided the following information on sales for the coming year: Quarter 1 Quarter 2 Quarter 3 Quarter 4 Units 40,000 40,000 30,000 80,000 Average selling price $5 $5 $5 $6 Assuming that the beginning inventory is 3,000 units, and that the company policy is to have 25% of the next quarter's sales in ending inventory, which quarter will have the lowest production?

quarter 2

Woodman Company uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. Estimated and actual data for labor and manufacturing overhead for last year are as follows. Estimated Actual Direct labor-hours 600,000 550,000 Manufacturing overhead $720,000 $680,000 The manufacturing overhead for Woodman Company for last year was:

underapplied by 20,000

Aerotoy Company makes toy airplanes. One plane is an excellent replica of a 737; it sells for $5. Vacation Airlines wants to purchase 12,000 planes at $1.75 each to give to children flying unaccompanied. Costs per plane are as follows: Direct materials $1.00 Direct labor 0.50 Variable overhead 0.10 Fixed overhead 0.90 No variable marketing costs would be incurred. The company is operating significantly below the maximum productive capacity. No fixed costs are avoidable. However, Vacation airlines wants its own logo and colors on the planes. The cost of the decals is $0.01 per plane and a special machine costing $1,500 would be required to affix the decals. After the order is complete, the machine would be scrapped. Should the special order be accepted?

yes, income will increase by 180

Bobick Company provided the following information for last year: Operating income $64,000 Sales $200,000 Beginning operating assets $387,000 Ending operating assets $413,000 Bobick's turnover ratio for last year was:

.5

LittleFish Company makes four products in a single manufacturing facility. Each unit must pass through multiple processes, including forging, shaping, and grinding. These products have the following unit product costs. ___________Product __ A __B __C ___D Direct materials $10.70 $5.40 $5.10 $7.20 Direct labor $19.10 $21.40 $29.00 $34.40 Variable manufacturing overhead 1.20 1.50 1.80 1.60 Fixed manufacturing overhead 22.40 16.00 15.00 17.60 Unit product cost $53.40 $44.30 $50.90 $60.80 Additional data concerning these products are listed below. ___________Product __A ___B ___C ___D Grinding minutes per unit 2.20 1.20 1.70 1.80 Selling price per unit $65.40 $58.50 $70.70 $76.20 Variable selling cost per unit $3.60 $3.80 $2.00 $3.40 Monthly demand in units 1,000 4,000 1,000 4,000 There is sufficient capacity in forging and shaping, but the grinding machines are potentially the constraint in the production facility. A total of 16,400 minutes are available per month on these machines. Direct labor is a variable cost in the company. How many units of A,B,C, and D should be produced if the maximum demand for each product is unlimited?

0 units of A; 13,667 units of B; 0 units of C; 0 units of D

The balance sheet for Crutcher Corporation reported 147,000 shares of common stock outstanding, 200,000 shares authorized, and 43,000 shares unissued. How many shares of treasury stock does Crutcher hold?

10,000

At December 31, 2009, Dawkins' inventory consists of 160 units of Inventory Item A, that has a cost of $3 per unit and a market value of $1 per unit; and 140 units of Inventory Item B, that has a cost of $6 per unit and a market value of $8 per unit. Dawkins applies LCM on an item-by-item basis. What should be the dollar amount of inventory presented on Dawkins' 12/31/09 balance sheet?

1000

Flying High Company manufactures model airplanes. During the month, it manufactured 10,000 airplanes. Each one used an average of 6.5 direct labor hours and an average of 1.5 sheets of aluminum. It normally manufactures 7,500 airplanes. materials and labor standards for making the airplanes are as follows: Direct Materials (1 sheet of aluminum @ $10.00) $10.00 Direct Materials (other accessories @ $8.75) 8.75 Direct Labor (6 hours @ $7.00) 42.00 Compute the standard number of sheets of aluminum allowed.

10000 sheets

Assume that net income was $100,000, depreciation expense was $5,000, accounts receivable increased by $7,500 and accounts payable increased by $2,500. The amount of cash flows from operating activities is:

100k

Inventory Records for Kingdom Co. revealed the following: Date Transaction # of Units Unit Cost 1/1 Beginning Inventory 20 $1 1/15 Purchase 25 $2 1/20 Purchase 30 $3 1/25 Purchase 15 $4 Kingdom sold 60 units of inventory for $5 per unit during the month. The ending inventory assuming FIFO would be:

105

The following table contains information for Bayern, Inc. in the current year before closing entries: Cash $6,000 Supplies $1,000 Prepaid Rent $2,500 Salary Expense $3,000 Equipment $25,000 Service Revenue $30,000 Other Expenses $15,000 Dividends $1,500 Accounts Payable $4,000 Capital (Common) Stock $20,000 How much will be in Retained earnings after closing entries?

10500

Cowboy Company sells a product for $20, variable costs are $9 per unit, and total fixed costs are $5,040. What is the per unit contribution margin?

11

At January 1, 2009, Iverson Co., which uses a weighted-average cost-flow assumption, had 30 units of inventory that had cost $7 per unit. On January 4, Iverson purchased an additional 40 units for $9 per unit; and on January 19, they purchased an additional 50 units at $12 per unit. During January, Iverson sold 114 units for $15 per unit. How much was Iverson's cost of goods sold for January 2009?

1112

Consider the following inventory transactions for September. beginning inventory 15 units @ $3.00 purchase on 9/12 20 units @ $3.50 purchase on 9/23 10 units @ $4.00 For the month of September, the company sold 35 units. What is costs of good sold under the average cost method (round the average unit cost to four decimals if necessary before computing the total)?

121

On January 1, 2010, Cow Farming Inc. purchases a tractor for $200,000 which has an expected useful life of 10 years and an estimated residual value of $10,000. What would the accumulated depreciation be on June 30, 2016, assuming Future Farming Inc. uses straight-line method for depreciation?

123,500

Sorrell Company makes all its sales on account. Accounts receivable payment experience is as follows: Percent paid in the month of sale 30% Percent paid in the month after the sale 60% Percent paid in the second month after the sale 8% Sorrell provided information on sales as follows: May $100,000 June $120,000 July $130,000 August (expected) $150,000 What is budgeted cash to be collected on account for the month of August?

132600

Inventory records for Marvin Company revealed the following: Date Transaction Number of Units Unit Cost Total Cost Mar. 1 Beginning inventory 2,000 $1 2,000 Mar. 10 Purchase 1,200 2 2,400 Mar. 16 Purchase 1,600 3 4,800 Mar. 23 Purchase 1,200 4 4,800 Total 6,000 14,000 Marvin sold 4,600 units of inventory during the month. The ending inventory assuming LIFO would be:

1400

At December 31, 2009, ABC's inventory consists of 160 units of Inventory Item A, that has a cost of $3 per unit and a market value of $4 per unit; and 140 units of Inventory Item B, that has a cost of $8 per unit and a market value of $7 per unit. ABC applies LCM on an item-by-item basis. What should be the dollar amount of inventory presented on ABC's 12/31/09 balance sheet?

1460

Simpleton Company engages in the following cash payments: Purchase equipment 2k Pay rent 500 Repay loan to the bank 5k Pay workers' salaries 1k what is the total amount of cash paid for operating activities?

1500

Stimpleton Company engages in the following cash payments: purchase equipment 2k pay rent 500 repay loan to the bank 5k pay workers' salaries 1k What is the total amount of cash paid for operating activities?

1500

Inventory records for Marvin Company revealed the following: Date Transaction Number of Units Unit Cost Total Cost Mar. 1 Beginning inventory 1,000 $7.20 7,200 Mar. 10 Purchase 600 7.25 4,350 Mar. 16 Purchase 800 7.30 5,840 Mar. 23 Purchase 600 7.35 4,410 Total 3,000 21,800 Marvin sold 2,300 units of inventory during the month. The cost of goods sold assuming FIFO would be:

16660

On January 1, 2007 Elliott Medical Supplies, Inc. received cash by signing a note payable for $200,000. The note carries an interest rate of 9% and principal plus interest are payable on December 31, 2009. How much interest expense should Elliott record for 2007?

18k

Church Corp., a newly formed corporation, recently sold 1,000 shares of its $10 par value stock for $30,000. Assuming there have been no other stock sales to date, what balance should Church Corp. report as "Paid-In Capital in Excess of Par" on its balance sheet?

20000

The Bayou company makes crab pots. Last month, direct materials costing $126,000 were put into production. Direct labor of $78,000 was incurred and overhead equaled $84,000. Selling and administrative expenses totaled $66,000 for the month and the company manufactured 3,000 crab pots. Compute the total prime cost.

204000

The Bayou company makes crab pots. Last month, direct materials costing $126,000 were put into production. Direct labor of $78,000 was incurred and overhead equaled $84,000. Selling and administrative expenses totaled $66,000 for the month and the company manufactured 3,000 crab pots. Compute the total prime cost

204k

Lopez Plastics Co. (LPC) issued callable bonds on January 1, 2010. LPC's accountant has projected the following amortization schedule from issuance until maturity: Date Cash Paid Interest Expense Decrease in Carrying Value Carrying Value 1/1/10 $207,020 6/30/10 $7,000 $6,211 789 206,230 12/31/10 $7,000 $6,187 813 205,417 6/30/11 $7,000 $6,163 837 204,580 12/31/11 $7,000 $6,137 863 203,717 6/30/12 $7,000 $6,112 888 202,829 12/31/12 $7,000 $6,085 915 201,913 6/30/13 $7,000 $6,057 943 200,971 12/31/13 $7,000 $6,029 971 200,000 LPC issued the bonds for:

207,020

Consider the year-end information for Spitzer Corporation. Cost of Goods Sold $420,000 Net Sales 800,000 Nonoperating expenses 10,000 Operating expenses 170,000 Income tax expenses 80,000 What amount will Spitzer report for operating income?

210k

John Smith has just invested $360,000 in a day spa. He expects to receive income of $80,000 a year, and to have the investment for 10 years. What is the accounting rate of return?

22.22%

Rizzo Manufacturing produces two types of cameras: 35mm and digital. The cameras are produced using one continuous process. Four activities have been identified: machining, setups, receiving, and packing. Resource drivers have been used to assign costs to each activity. The overhead activities, their costs, and the other related data are as follows. Product Machine Hours Setups Receiving Orders Packing Orders 35mm 10,000 100 200 400 Digital 10,000 250 800 2,000 Costs $60,000 $40,000 $8,000 $24,000 Calculate the total overhead assigned to the 35mm cameras using packing orders to calculate a plantwide rate.

22000

The following amounts are reported in the ledger of Willis Company: Assets $10,000 Liabilities $7,500 Retained Earnings $250 What is the balance in the common stock account?

2250

Suppose that GOPOKES Manufacturing has two classes of distributors: JIT distributors and non-JIT distributors. The JIT distributor places small, frequent orders; and the non-JIT distributor tends to place larger, less frequent orders. Both types of distributors are buying the same product. GOPOKES Manufacturing provides the following information about customer-related activities and costs for the last quarter of 2008: JIT Distributors Non-JIT Distributors Cost Drivers: Sales Orders 200 20 Sales Calls 150 150 Service Calls 900 100 Average order size 50 500 Manufacturing cost/unit $100 $100 Customer Costs: Processing sales orders $880,000 Selling goods $320,000 Servicing goods $300,000 Total $1,500,000 Unit selling price is cost plus 100 percent (equals $200). Using the listed cost drivers to allocate customer costs with Activity-Based Costing, how much customer cost would be allocated to the Non-JIT distributors (round to the nearest whole dollar)?

270k

Prior to year-end adjusting entries, Cowboy Co. had a balance in accounts receivable of $300,000 and an allowance for uncollectible accounts of $5,000. Cuomo then recorded bad debt expense of $3,000. What is the net realizable value of Cuomo's accounts receivable after this adjustment?

292,000

As of October 1, 2009, Cowboy Co. had a balance in accounts receivable of $300,000 and the net realizable value of their accounts receivable was $295,000. On October 2, Cowboy wrote off a $5,000 bad debt. What is the net realizable value of Cowboy's accounts receivable after this write-off?

295,000

YellowFishwithOrangeSpots Enterprises, LLC, wants to buy an automated machine to be used in producing gears for manufacturers of large construction equipment. The initial investment required is $1,500,000. The machine will last five years with no expected salvage value. The expected after-tax cash flows associated with the project are as follows: Year Cash Revenues Cash Expenses 1 $1,500,000 $1,000,000 2 $1,500,000 $1,000,000 3 $1,500,000 $1,000,000 4 $1,500,000 $1,000,000 5 $1,500,000 $1,000,000 What is the payback period for the investment in the automated machine?

3.00 years

Given the information below about David Corp, how much dividends did the company pay? Beginning retained earnings 35000 ending retained earnings 90000 increase in cash 25000 net income 85000 change in SE 20000

30000

Kramer, Inc., manufactures a product that passes through two processes: mixing and molding. all manufacturing costs are added uniformly in the mixing department. Information for the mixing department for April follows: Work in process, April 1: Units (35% complete) 5,000 Direct materials $24,000 Direct labor $30,000 Overhead $10,000 During April, 25,000 units were completed and transferred to the molding department. The following costs were incurred by the mixing department during April: Direct materials $90,000 Direct labor $120,000 Overhead $30,000 By April 30, 2,500 units that were 80 percent complete remained in Mixing. Kramer uses the weighted average method. Kramer's cost of April's ending work in process for the mixing department would be:

304000

Beginning retained earnings 35k ending retained earnings 90k increase in cash 25k net income 85k change in SE 20k

30k

The Cowboy company makes crab pots. Last month, direct materials costing 252,000 were put into production. Direct labor of $156,000 was incurred and overhead equaled $168,000. Selling and administrative expenses totaled $132,000 for the month and the company manufactured 3,000 crab pots. Compute the total conversion cost.

324k

Melody Company sells a product for $14, variable costs are $10 per unit, and total fixed costs are $5,040. What is the per unit contribution margin?

4

The following table contains information for Bayern, Inc. in the current year before closing entries: Cash $6,000 Supplies $1,000 Prepaid Rent $2,500 Salary Expense $3,000 Equipment $25,000 Service Revenue $30,000 Other Expenses $15,000 Dividends $1,500 Accounts Payable $4,000 Capital (Common) Stock $20,000 How many of the above accounts are temporary?

4

On September 1 of the current year Middelton Corp. issues cash and accepts a $1,000 note receivable that offers 12% interest and is due in six months. How much interest revenue will Middleton Corp report during the current year?

40

Delson Company produces two types of piano legs, plain and fancy, with unit contribution margins of $8 and $12, respectively. Each piano leg must spend time on a special machine. The firm owns four machines that together provide 10,000 hours of machine time per year. The plain leg requires 0.25 hours of machine time, the fancy leg requires 0.5 hours of machine time. How many of each type of leg must be sold to optimize total contribution margin?

40,000 plain legs; 0 fancy legs

A company provided the following data: Sales $540,000 Variable costs $378,000 Fixed costs $120,000 Expected production and sales in units 40,000 What is the break-even point in sales dollars?

400000

Allen Company has had a net income of $15,000, $8,000, $19,000, and $6,000 over the first four years of the company's existence. If the average amount of dividends paid over the last four years is $1,500, what is the ending retained earnings balance?

42,000

Tarzan Company makes jungle gyms for children. The price is $120 and variable expenses are $90 per unit. Total fixed expenses are $253,750. Last year, Tarzan sold 12,000 jungle gyms. What was the margin of safety for Tarzan last year? (Round to the nearest whole number.)

425000

Warden Company reflected the following balances in the stockholders' equity section at December 31, 2007: Common Stock, par $15, 30,000 shares outstanding; Preferred Stock, 6%, $100 par, 1,000 shares outstanding. Based on these terms, the preferred stock should receive dividends of $6 per share each year. Warden Co. has not paid any dividends since its formation on January 1, 2005. Assuming that the preferred stock is noncumulative and Warden's pays $50,000 in dividends during the current year, how much will the common stockholders receive?

44k

Honeydew Company produces two products, a high end laptop computer under the label Bunsen Laptops, and an inexpensive desktop computer under the label Beaker Computers. The total overhead from the two products is $14,000. The controller has collected the expected annual prime costs for each product, the machine hours, the setup hours, and the expected production. Bunsen Beaker Total prime costs $96,000 $102,000 Units 2,000 3,000 Direct Labor Hours 20,000 5,000 Machine Hours 750 1,500 Setup Hours 50 50 Calculate the overhead cost allocated to the Bunsen Laptops, using a plantwide rate based on machine hours.

4667

Pete Company manufactures footballs. The management accountant wants to calculate the fixed and variable costs associated with the leasing of machinery. Data for the past four months were collected. Month Lease cost Machine hours April $21,000 550 May 17,000 400 June 19,000 510 July 22,230 570 Using the high-low method calculate the fixed cost of leasing

4694

Pete Company manufactures footballs. The management accountant wants to calculate the fixed and variable costs associated with the leasing of machinery. Data for the past four months were collected. Month Lease cost Machine hours April $21,000 550 May 17,000 400 June 19,000 510 July 22,230 570 Using the high-low method calculate the fixed cost of leasing.

4694

"Receiving" unloaded 600 crates and processed 7,500 items through thte department in the last year. Receiving has three activities: unloading, counting goods, and inspecting. Unloading uses a forklift that is leased for $14,000 per year. The forklift is used only for unloading. The fuel for the forklift is $1,400 per year. Other operating costs (maintenance) for the forklift total $1,500. Inspection uses some special testing equipment that has a depreciation of $2,800 per year and an operating cost of $2,500. Receiving has three employees who have an average salary of $40,000 per year. The work distribution matrix for the receiving personnel is as follows. Activity % of Time on each activity Unloading 50 Counting 15 Inspecting 35 No other resources are used for these activities. What is the cost of the inspecting activity?

47300

Gentry Company produces speaker systems for trucks. Estimated sales (in units) in January are 20,000; in February 25,000; and in March 22,000. Each unit is priced at $45. Gentry wants to have 25% of the following month's sales in ending inventory. That requirement was met on January 1. Each speaker system requires 2 boxes and 10 yards of wire. Boxes cost $5 each and wire is $0.90 per yard. Gentry wants to have 30% of the following month's production needs in ending raw materials inventory. On January 1, Gentry had 9,000 boxes and 100,000 yards of wire in inventory. How many boxes does Gentry expect to purchase in January?

48050

Darth Company is considering the purchase of new heavy construction equipment that will cost $2,000,000 and have a life of 8 years with no expected salvage value. The expected cash flows associated with the project are as follows: Year Cash Revenues Cash Expenses & Depreciations 1 $2,400,000 $1,900,000 2 $2,400,000 $1,900,000 3 $2,400,000 $1,900,000 4 $2,400,000 $1,900,000 5 $2,400,000 $1,900,000 6 $2,400,000 $1,900,000 7 $2,400,000 $1,900,000 8 $2,400,000 $1,900,000 What is the average annual income for this project?

500000

Given the information below, what is the gross profit? sales revenue $320,000 accounts receivable 50,000 ending inventory 100,000 cost of goods sold 250,000 sales returns 20,000

50k

Inventory records for Marvin Company revealed the following: Date Transaction Number of Units Unit Cost Total Cost Mar. 1 Beginning inventory 1,000 $7.20 7,200 Mar. 10 Purchase 600 7.25 4,350 Mar. 16 Purchase 800 7.30 5,840 Mar. 23 Purchase 600 7.35 4,410 Total 3,000 21,800 Marvin sold 2,300 units of inventory during the month. The ending inventory assuming FIFO would be:

5140

David Inc. incurred the following costs associated with the purchase of a piece of land that it will use to build an office building: sales price of land $500,000 sale of salvaged parts already on land (20,000) demolition of old building 30,000 ground breaking ceremony (food and supplies 1,500 legal fees to lawyers 7,500 What amount should be recorded for the purchase of the land?

517500

The accounts payable account has a beginning balance of $12,000 and the company purchased $50,000 of supplies on account during the month. The ending balance was $10,000. How much did the company pay to creditors during the month?

52k

As of October 1, 2009, Cuomo Co. had a balance in accounts receivable of $580,000 and an allowance for uncollectible accounts of $6,000. On October 2, Cuomo wrote off a $3,000 bad debt. What is the net realizable value of Cuomo's accounts receivable after this write-off?

574,000

Job 910 was recently completed. The following data was recorded on its job cost sheet. Direct materials $3,193 Direct labor - hours 21 labor - hours Direct labor wage rate $12 per labor-hour Machine - hours 166 machine - hours The company applies manufacturing overhead on the basis of machine-hours. The predetermined overhead rate is $15 per machine-hour. The total cost that would be recorded on the job cost sheet for Job 910 would

5935

Job 910 was recently completed. The following data was recorded on its job cost sheet. Direct materials $3,193 Direct labor - hours 21 labor - hours Direct labor wage rate $12 per labor-hour Machine - hours 166 machine - hours The company applies manufacturing overhead on the basis of machine-hours. The predetermined overhead rate is $15 per machine-hour. The total cost that would be recorded on the job cost sheet for Job 910 would be:

5935

The following table contains financial information for Fisher Inc. in 2010 before closing entries: Cash $26,000 Common Stock $40,000 Supplies $ 4,000 Other Expenses $ 1,500 Accounts Payable $20,000 Revenues $40,000 Wage Expense $ 3,000 Prepaid Rent $ 4,000 Dividends $ 3,000 Equipment $45,000 How many of the above accounts are permanent?

6

The following table contains financial information for Fisher Inc. in 2010 before closing entries: Cash $26,000 Common Stock $40,000 Supplies $ 4,000 Other Expenses $ 1,500 Accounts Payable $20,000 Revenues $40,000 Wage Expense $ 3,000 Prepaid Rent $ 4,000 Dividends $ 3,000 Equipment $45,000 How many of the above accounts are permanent?

6

Paney Company makes calendars. Information on cost per unit is as follows: Direct materials $1.50 Direct labor 1.20 Variable overhead 0.90 Fixed overhead 1.00 Variable marketing expense 0.40 Fixed marketing expense totaled $13,000 and fixed administrative expense totaled $35,000. The price per calendar is $10. What is the contribution margin ratio?

60%

The following financial information is from Shovels Construction Company for 2010. Accounts Payable $5,000 Buildings 70,000 Cash 10,500 Accounts Receivable 9,500 Sales taxes payable 12,000 Retained Earnings 47,500 Office supplies 40,000 Notes payable due in 18 months 3,000 Interest payable 35,000 Common stock What amount should be reported as "Current Assets" on the 2010 balance sheet, assuming the accounts above reflect normal activity?

60,000

Baker Company reflected the following balances in the stockholders' equity section at December 31, 2007: Common Stock, par $15, 60,000 shares outstanding; Preferred Stock, 6%, $100 par, 2,000 shares outstanding. Based on these terms, the preferred stock should receive dividends of $6 per share each year.Baker Co. has not paid any dividends since its formation on January 1, 2005. Assuming that the preferred stock is cumulative and Baker's pays $100,000 in dividends during the current year, how much will the common stockholders receive?

64k

The following table contains information for Walker, Inc. in the current year before closing entries: Cash $600 Supplies $100 Prepaid Rent $250 Salary Expense $300 Equipment $2,500 Accumulated Depr $100 Service Revenue $3,000 Other Expenses $1,500 Dividends $150 Accounts Payable $400 Common Stock $2,100 Depreciation Expense $100 How many of the above accounts are permanent?

7

The following financial information is from Morgan Lab Supplies adjusted trial balance: Accounts payable $ 15,000 Accounts receivable 10,500 Cash 9,500 Common Stock 12,000 Cost of goods sold 47,500 Property, plant, and equipment 70,000 Inventory 40,000 Notes payable (due in 6 months) 43,000 Operating expenses 35,000 Retained earnings 5,000 Sales revenue 137,500 What amount should Morgan report as Stockholders' Equity for the current year?

72k

Division X and Division Y are both subsidiaries of Company Z. Division X manufactures a part that it sells to customers outside the company. Data concerning this part appear below. Selling price to outside customers $155 Variable cost per unit $75 Contribution margin per unit $80 Total fixed costs $500,000 Fixed cost per unit at capacity $20 Capacity in units 50,000 units Division Y would like to use the part manufactured by Division X in one in one of its products. Division Y currently purchases a similar part made by an outside company for $88 per unit and would substitute the part made by Division X. Division Y requires 5,000 units of the part each period. Division X is currently producing and selling 25,000 units to outside customers. Producing additional parts for Division Y would not affect these sales. What is the minimum acceptable transfer price from the standpoint of Division X?

75

Hillandale Company manufactures overalls. During the year, it manufactured 125,000 overalls, using 2.9 hours of direct labor at a rate of $6.25 per hour. The materials and labor standards for manufacturing the overalls are as follows: Direct materials (5 yards of denim @ $2 per yard) $10 Direct labor (3 hours @ $6 per hour) 18 It tood Hillandale 600,000 yards at $1.95 per yard to make the 125,000 overalls. What is Hillandale's labor efficiency variance?

75000 F

Soprano Design Services issued a $10,000 four-year, 5% bond on January 1, 2007. The bond interest is paid each December 31. Assume that Soprano's bonds were sold at an issue price of $8,415 to yield 10% interest (market interest rate). Applying the effective interest method, what will be the amount of interest expense that should be recorded in the first year?

842

The following information pertains to Julia & Co.: March 1. Beginning inventory = 30 units @ $5 March 3. Purchased 15 units @ $4 March 9. Sold 20 units @ $8 What is the cost of goods sold for Julia & Co. assuming it uses LIFO?

85

GreatWhiteShark Company will open a new store on January 1. Based on experience from its other retail outlets, GreatWhiteShark Company is making the following sales projections. Cash Sales Credit Sale January $80,000 $95,000 February $40,000 $60,000 March $75,000 $55,000 April $50,000 $90,000 GreatWhiteShark Company estimates that 65% of the credit sales will be collected in the month following the month of sale with the balance (the remaining 35%) collected in the second month following the month of sale. (January credit sales will be collected in February and March, February credit sales will be collected in March and April, etc.) Based on this data, the balance in accounts receivable on January 31 will be (the company is owed how much by customers at the end of January):

95000

The Bayou company makes crab pots. Last month, direct materials costing $126,000 were put into production. Direct labor of $78,000 was incurred and overhead equaled $84,000. Selling and administrative expenses totaled $66,000 for the month and the company manufactured 3,000 crab pots. Compute the per-unit product cost.

96

On April 4, 2009, Xavier Co. purchased $1,400 of inventory, terms 5/10, n/30. Xavier paid the vendor for the goods on April 11. Xavier uses a perpetual inventory system. The journal entry to record this payment would include:

A credit to inventory for $70

The adjusting entry required when previously recorded long-term assets (like equipment or buildings) are used during the period includes:

A debit to an expense

On December 7, 2009, XYZ Co. sold 260 units of Product U to a customer for $9 per unit. The goods had cost Ditzler Co. $5 per unit, and XYZ uses a perpetual inventory system. The journal entry to record this sale would not include:

A debit to sales for $2,340.

An overstatement of Fortune's Co.'s 2009 ending inventory would cause:

An overstatement of Fortune Co.'s 2009 net income.

Psych sold 20 units for $10 per unit that cost Psych $5 per unit. What is the journal entry to record the sale of the inventory under the perpetual inventory method?

Cash $200 COGS $100 Inventory $100 Sales Revenue $200

On February 1, 2010, Sanger Corp. issues cash and accepts a $2,000 note receivable that offers 10% interest and is due in six months. Record the transaction on August 1, 2010, when the borrower pays Sanger the correct amount owed.

Cash 2100 interest revenue 100 notes receivable 2000

Dexter Inc. purchased equipment on January 1 of 2014 for $100,000 and sold the equipment at the end of 2015 for $80,000. Dexter believed at the time of purchase that the equipment would last ten years and would have a residual value of $10,000. Dexter uses straight-line depreciation. What would be the appropriate journal entry upon sale of the equipment?

Cash 80,000 Accumulated Depr 18,000 Loss 2,000 Equipment cr 100k

On August 1, 2010, Pete Inc. paid $36,000 for 18 months worth of rent on their warehouse. What would be the amount of rent expense in the 2010 financial statements for Rents-A-lot under both the cash-basis and accrual-basis accounting?

Cash-basis = $36,000; Accrual-basis = $10,000.

A company issued 20,000 shares of $1 par value stock for $5 per share. What is true about the journal entry to record the issuance?

Credit Additional Paid-In Capital $80,000

On December 2, Coley Corp. reacquired 2,000 shares of its $2 par value common stock for $27 each. On December 20, Coley Corp. reissued 800 shares for $15 each. Which of the following is correct of the journal entry for the reissued shares?

Credit Treasury Stock $21,600

On June 5th, Fifth Element purchased 100 shares of stock for $10 per share that were previously issued for $5 per share with a par value of $1 per share. On December 10th, Fifth Element reissues 30 shares for $15 per share. What would be the journal entry to record the reissuance of the shares?

Credit Treasury Stock for $300

During the year, Cheng Company paid wages of $22,000. In addition, $8,000 in wages has accrued by the end of the year but has not been paid. The year-end adjusting entry would include which one of the following?

Credit to wages payable for $8,000