Accounting final

What is the total amount of stockholders' equity that will be presented on the company's March 31, 2020, balance sheet?

$1,340,000 $1,540,000 total at Dec. 31, 2019 − $200,000 treasury stock = $1,340,000

If the stated interest rate is 12% per year, but it is compounded semiannually, then the adjusted rate used for present or future value calculations will be

6% per 6-month period

Total stockholders' equity includes $50,000 of common stock with a stated value of $0.50, and 5,000 shares of treasury stock with a total cost of $25,000. How many total shares are outstanding?

95,000

Failure to record the earned portion of unearned revenue would result in which of the following?

Net income being understated.

Suppose a corporation issues 5,000 shares of $1 par common stock for $30 per share. In addition to the increase in cash, what effect does this transaction have on the accounting equation?

Paid-in capital in excess of par increases $145,000.

Under accrual accounting when is revenue recognized?

When earned, and expenses when incurred.

Each of the following items is considered a cash equivalent except a.60-day corporate commercial paper. b.a 75-day U.S. Treasury bill. c.a 180-day note issued by a local government. d.a 30-day certificate of deposit.

a 180-day note issued by a local government.

Cash flows from borrowing and paying off a 90-day bank loan are classified as

financing activities

Which of the following items would be added to the company's cash balance on a bank reconciliation?

interest earned on the bank account

Cash flows from acquiring and disposing of long-term assets are classified as

investing activities

When using the indirect method to determine operating cash flows, how is the issuance of stock to retire a long-term debt shown on a statement of cash flows?

noncash investing or financing activity

Cash flows from acquiring and selling products are classified as

operating activities.

A bond issuing at 101.25 means that the bond

sold for $1,012.50

A corporation issued $150,000 of 10-year bonds at the stated rate of 8%, with interest payable semiannually. How much cash will the bond investors receive at the end of the first interest period? 150,000 * .04=

$6,000

The Kaplan Group sold $200,000 of 10-year bonds for $190,000. The face rate on the bonds was 8% and interest is paid annually on December 31. What entry would be made on December 31 when the interest is paid? (Numbers are omitted.)

Interest Expense Discount on Bonds Payable Cash

Which of the following is true for a corporation that issues 1,000 shares of $2 par common stock at $5 per share?

Total stockholders' equity will increase by $5,000

Which of the following adjusting entries involves the cash account? a.Deferred Revenues b.Accrued Expenses c.Deferred Liabilities d.None of these choices are correct.

d. None of these choices are correct.

A graphics design company issued bonds in the amount of $1,000,000 with a stated interest rate of 8%. If the interest is paid semiannually and the bonds are due in 10 years, what would be the total amount of interest paid over the life of the bonds?

$800,000

The total amount of interest that will be paid on a 5-year, $90,000 note payable at 11% simple annual interest is?

$90,000 principal × 11% annual interest = $9,900 x 5 years = $49,500

During the first quarter of the current year, the company sold 4,000 batteries on credit for $150 each plus state sales tax of 6%.Refer to General Lighting. Sales taxes are required to be paid to the state taxing authority at the end of the quarter. Which of the following records the sale of the batteries?

Accounts Receivable 636,000 Sales Revenue 600,000 Sales Tax Payable 36,000

This company was incorporated as a new business on January 1, 2019. The company is authorized to issue 50,000 shares of $5 par common stock and 10,000 shares of 6%, $10 par, cumulative, participating preferred stock. On January 1, 2019, the company issued 8,000 shares of the common stock for $15 per share and 2,000 share of the preferred stock for $30 per share. Net income for the year ended December 31, 2019 was $375,000.Refer to Lanier Tech. What is the amount of the company's total capital stock at December 31, 2019?

Common:8,000 shares × $15 =$120,000 Preferred:2,000 shares × $30 =60,000 Total = $180,000

Manatee Manufacturing sells a piece of equipment to make room for new machinery. Manatee will receive the sales price of $50,000 at the end of 4 years. Assuming interest at a rate of 6% per year, the Present Value of this future cash flow is how much?

Present Value = Cash Flow (PV of Single Amount, 4 Periods, 6%)= $50,000 × .79209 = $39,604.50

Tom liquidates an investment, and his proceeds will be received in 8 annual payments of $10,000 each with interest computed at 7%. What is the Present Value of this Annuity?

Present Value = Investment (PV of an Annuity, 8 Periods, 7%)= $10,000 x 5.97130 = $59,713.00

You just won the lottery and have elected to receive 10 annual payments instead of the lump sum of $74,818.59. Calculate the amount of your annual payment assuming a 6% interest rate.

Present Value = Investment x (PV of Annuity, 10 periods, 6%)$74,818.59 = Investment x 7.36009$74,818.59/7.36009 = $10,165.44

Eric is considering buying a car. He can either purchase the car outright or make 5 annual payments of $10,000 at the end of each year. If the interest rate is 7%, how much is the outright purchase price?

Present Value = Investment x (PV of Annuity, 5 periods, 7%)= $10,000 x 4.10020 = $41,002.00

Mark is planning on making an investment in a new computer system. He wants to know how much he must invest to have $9,000 in 4 years if the interest rate is 5% per year?

Present Value = Investment x (PV of a Single Amount, 4 Periods, 5%)= $9,000 x 0.82270 = $7,404.30