ACCOUNTING II, Acct. 18, Chp. 17 + 16 lol, ACCT 5/6, Chapter 21 PVC Analysis Practice, quizlet acct 2, ACCT Chap 1 PRACTICE, Chapter 1: Accounting and the Business Environment

​Tan's gross pay for the week is​ $1,900. His year−to−date pay is under the limit for OASDI. Assume that the rate for state and federal unemployment compensation taxes is​ 6% and that​ Tan's year−to−date pay has previously exceeded the​ $7,000 cap. What is the amount of state and federal unemployment tax that his employer must record as payroll tax expense and pay to the federal and state​ governments?

$0

The following information has been provided by Crosby​ Corporation: Direct Labor $6,200 Direct Materials Used 2,300 Direct Materials Purchased 7,000 Cost of Goods Manufactured 18,000 Ending Work−in−Process Inventory 1,300 Corporate​ Headquarters' Property taxes 400 Manufacturing Overhead Incurred 490 The beginning balance of Work−in−Process Inventory account was​ ________.

10,310

Sunshine Blender Company sold 4,000 units in October at a sales price of $45 per unit. The variable cost is $20 per unit. Calculate the total contribution margin.

100,000 4,000 x 45 = 180,000 4,000 x 20 = 80,000 180,000 - 80,000 = 100,000

Sunshine Blender Company sold 3,000 units in October at a sales price of $50 per unit. The variable cost is $15 per unit. Calculate the total contribution margin.

105,000 50 x 3,000 = 150,000 15 x 3,000 = 45,000 150,000 - 45,000 = 105,000

Valley, Inc. has 11,000 shares of preferred stock outstanding. The preferred stock has a $140 par​ value, a 5​% dividend​ rate, and is noncumulative. If Valley has sufficient funds to pay​ dividends, what is the total amount of dividends that will be paid out to preferred​ stockholders?

11000 x .05 = 550 550 x 140 = 77000

Carrabelle Company has provided the following​ information: Sales price per unit $50 Variable cost per unit 18 Fixed costs per month $14,000 Calculate the contribution margin ratio.​ (Round your answer to two decimal​ places.)

64% 18 - 50 = 32 32 / 50 = .64

​Advantage, Inc., a tennis equipment​ manufacturer, has variable costs of $0.80 per unit of product. In​ August, the volume of production was 27,000 ​units, and units sold were 20,500. The total production costs incurred were $30,200. What are the fixed costs per​ month?

8,600

Which of the following accounts will be included in a post−closing trial​ balance?

Accumulated Depreciation—Building

Which of the following correctly describes the accounting for administrative expenses of a manufacturing​ company?

Administrative expenses are period costs and are expensed as incurred.

A business settles a liability by making a payment in cash. How does paying this liability affect the accounting equation of the business? A) Assets decrease; liabilities decrease. B) Liabilities decrease; equity increases. C) Assets increase; liabilities increase. D) Assets increase; equity decreases.

Answer: A

Managerial accounting provides information to: A) internal decision makers. B) outside investors and lenders. C) auditors. D) taxing authorities.

Answer: A

Which of the following is an external user of a business' financial information? A) customers B) cost accountant C) company manager D) the board of directors

Answer: A

Which of the following statements helps analyze the business performance in terms of profitability? A) income statement B) balance sheet C) statement of cash flows D) statement of owner's equity

Answer: A

Scott's Camera Shop started the year with total assets of $80,000 and total liabilities of $40,000. During the year, the business earned revenues of $120,000 and incurred expenses of $70,000. Scott made no additional capital contributions during the year, but did make withdrawals of $60,000. Calculate Scott's net income for the year. A) $50,000 B) $120,000 C) $70,000 D) $80,000

Answer: A Explanation: A) Net income = Revenues - Expenses Net income = $120,000 - $70,000 = $50,000

A business collects $5,000 from its customer which was owed since a previous month. How does this affect the accounting equation of the business? A) Assets increase by $5,000; liabilities decrease by $5,000. B) Assets increase by $5,000; assets decrease by $5,000. C) Assets increase by $5,000; liabilities increase by $5,000. D) Assets increase by $5,000; equity increases by $5,000.

Answer: B

Which of the following is the correct accounting equation? A) Assets + Liabilities = Equity B) Assets = Liabilities + Equity C) Assets + Revenues = Equity D) Assets + Revenues = Liabilities + Expenses

Answer: B

Which of the following is shown on the balance sheet as well as the statement of cash flows? A) Owner's equity (ending balance) B) Net income C) Total assets D) Cash (ending balance)

Answer: D

The assets of Sunlight Company are $270,000 and equity is $90,000. Liabilities will be: A) $60,000. B) $360,000. C) $270,000. D) $180,000.

Answer: D Explanation: D) Assets - Equity = Liabilities $270,000 - $90,000 = $180,000

The assets of Moon Company are $150,000 and liabilities are $90,000. The equity will be: A) $180,000. B) $300,000. C) $240,000. D) $60,000.

Answer: D Explanation: D) Assets - Liabilities = Equity $150,000 - $90,000 = $60,000

IFRS is the main U.S. accounting rule book and is currently created and governed by the FASB.

Answer: FALSE

The balance sheet shows whether or not a business is earning profits.

Answer: FALSE

The income statement is also called the statement of financial position.

Answer: FALSE

The income statement shows whether or not a business can generate enough cash to pay its liabilities.

Answer: FALSE

The statement of cash flows informs users about how much of the earnings were kept and reinvested in the company.

Answer: FALSE

The total of amount of assets that a business possesses, may or may not equal the total of liabilities and equity of the business.

Answer: FALSE

A business can be organized as a sole proprietorship, partnership, corporation, or limited-liability company (LLC).

Answer: TRUE

Business owners use accounting information to set goals, evaluate progress toward those goals, and make adjustments when needed.

Answer: TRUE

By looking at a statement of owner's equity, the effect of withdrawals on the ending balance in owner's equity can be evaluated.

Answer: TRUE

Different users of financial statements focus on the different parts of the financial statements for the information they need.

Answer: TRUE

The left side of the accounting equation measures the amount that the business owes to creditors and to the owner.

Answer: TRUE

The relative proportion of economic resources and obligations would be shown by the balance sheet.

Answer: TRUE

Regarding a classified balance​ sheet, which of the following statements is​ correct?

Assets are listed in the order of their liquidity.

Which of the following will most likely be considered an indirect material cost for a​ bakery?

B.spices (CORRECT) A. eggs C. flour D. milk

Use the following information to calculate the cost of goods sold for The Emmet Company for the month of June​:

Beginning Finished Goods Inventory +PLUS+ Cost of Goods Manufactured =EQUALS= Cost of Goods Available for Sale -MINUS- Ending Finished Goods Inventory () =EQUALS= Cost of Goods Sold

Suppose Price Point Furniture issued 150,000 shares of ​$0.05 par common stock at $5 per share. Which journal entry correctly records the issuance of this​ stock?

Cash 750,000 CREDIT Common Stock—$0.05 Par Value 7,500 CREDIT Paid-In Capital in Excess of Par-Common 742,500

Received payment from Small​, less discount.

Cash 1,169 Accounts Receivable—Small 1,169

Received payment from Jex Company.

Cash 2,900 Accounts Receivable—Jex Company 2,900

Journalize the sales transactions. Explanations are not required. ​(Record debits​ first, then credits. Exclude explanations from journal​ entries.) Apr. 1​: Frank sold $30,000 of​ men's sportswear for cash. Cost of goods sold is $18,000. Begin by preparing the entry to journalize the sale portion of the transaction. Do not record the expense related to the sale. We will do that in the following step.

Cash 30,000 Sales Revenue 30,000

Which item does not appear on a statement of cash flows prepared by the indirect​ method?

Collections from customers

more steps

Cost of Goods Manufactured (59,100) / Total Units Produced (17,800) = Unit Product Cost (3.32)

Which of the following describes working​ capital?

Current assets minus current liabilities

Lauren and Elizabeth are partners. Lauren has a capital balance of​ $125,000 and Elizabeth has a capital balance of​ $110,000. Harry invested​ $100,000 to acquire an ownership interest of​ 30%. The journal entry to record the receipt of​ Harry's contribution will​ ________.

D. decrease​ Lauren, Capital

Requirement 1. Compute the predetermined overhead allocation rate per direct labor dollar. Requirement 2 . Prepare the journal entry to allocate overhead costs for the year.

Estimated overhead cost ÷ Estimated direct labor cost = Predetermined overhead allocation rate 125,000 ÷ $78,125 = 160 Work-in-Process Inventory 107,200 Manufacturing Overhead 107,200 Allocated overhead to WIP.

Purchase of treasury stock.

F-

Cash sale of land (no gain or loss).

I+

Purchase of equipment

I-

Which of the following is true of the statement of cash​ flows?

It covers a span of time and is dated the same as the income statement.

Mitchell Company receives a bill from one of its suppliers for advertising services received and will pay the supplier next month. How does the receipt of the bill from the supplier affect the accounting equation of​ Mitchell?

Liabilities increase and equity decreases.

Regarding​ liabilities, which of the following statements is incorrect​? _?_

Liabilities represent one of the two claims to assets. B. Liabilities are economic resources that are expected to benefit the business in the future. This is the correct answer. C. ​Many, but not​ all, liabilities have the word payable in their titles. Your answer is not correct. D. A creditor who has loaned money to a business has a claim to some of the​ business's assets until the business pays the debt. B. Liabilities are economic resources that are expected to benefit the business in the future. IS THE CORREC T ANSWER FOR THIS WRONG QUESTION :)

Purchase merchandise inventory for cash of $2,200.

Merchandise Inventory $2,200 cash $2,200

Acquisition of building by issuance of common stock.

NIF

Decrease in Merchandise Inventory.

O+

Decrease in accounts receivable

O+

Depreciation Expense.

O+

Edwin and Darren have decided to form a partnership. Edwin contributes​ $82,000 cash and merchandise inventory with a current market value of​ $15,000. Darren contributes​ $2,200 cash and office furniture with a current market value of​ $2,700. When journalizing these transactions​ ________.

Office Furniture will be debited for​ $2,700

Purchased raw materials on​ account, $22,000.

Raw Materials Inventory 22,000 Accounts Payable 22,000

Which of the following accounts will be closed by crediting the Income Summary​ account?

Service Revenue

Accounting is referred to as the language of business because it is the method of communicating business information to stakeholders.

TRUE

Manufacturing overhead costs allocated to a job amounted to $493,000. The actual manufacturing overhead costs incurred during the year were $530,000. Overhead costs have been underallocated.

TRUE

Manufacturing overhead includes indirect manufacturing​ costs, such as insurance and depreciation on the factory building.

TRUE

Which of the following is true of a​ corporation?

The earnings of a corporation may be subject to double taxation.

Which of the following is NOT an assumption of cost−volume−profit ​(CVP) analysis?

The price per unit changes as volume changes.

Which of the following is a disadvantage of partnership​ firms?

They have mutual agency which creates personal obligations for each partner.

Benefits are extra compensation items that are not paid directly to an employee.

True

Medicare taxes are a required column in a payroll register.

True

​________ is a pay amount stated at an hourly rate.

Wage

Managerial accounting focuses on information for external decision makers.

_ FALSE

Metropolitan Casting Services started the year with total assets of​ $80,000 and total liabilities of​ $65,000. The revenues and the expenses for the year amounted to​ $120,000 and​ $60,000, respectively. During the​ year, the company did not receive any additional​ capital, but the owner did withdrawal​ $50,000. Calculate the amount of increase or decrease in equity for the year.

a $10,000 increase

Which of the following is most likely a service​ company?

a law firm

Analysts look for red flags in financial statements that may signal financial trouble. Which of the following is a red flag that suggests that a company may be in​ trouble?

a significant decrease in net income for several years in a row

In a​ partnership, mutual agency means that​ ________.

any partner can bind the business to a contract within the scope of its regular business operations

Cost−volume−profit analysis is NOT useful in​________.

calculating operating expenses

Which of the following entries is necessary to close the appropriate depreciation account at the end of the​ year?

debit Income Summary and credit Depreciation Expense

Which of the following is a prime cost and a conversion​ cost?

direct labor

A contribution margin income statement classifies costs by​ function; that​ is, costs are classified as either product costs or period costs.

false

A corporation is a business organized under federal law that is a separate legal entity.

false

A high times−interest−earned ratio indicates difficulty in paying interest expense.

false

A profitable corporation may make distributions to stockholders in the form of bonuses.

false

A transaction is any event that affects the financial position of the business and can be easily estimated. _?_

false

Capital deficiency occurs when a​ partner's capital account has a credit balance.

false

During the current​ year, Dubois, Inc. incurred $7,000 in fixed costs and $13,000 in variable costs. If the number of units produced is halved next​ year, the company will incur $3,500 as fixed costs and $6,500 as variable costs.

false

Profits and losses in a partnership must be shared based on each​ partner's capital balances.

false

The sales required to achieve a target profit can be determined by using the contribution​ margin, contribution margin​ ratio, or breakeven approaches.

false

The third section presented on the statement of cash flows is the non−cash operating activities section.

false

Printed Q 10 out

lol

Printed Q 22 out

lol

Printed Q 23 out

lol

Printed Q 24 out

lol

Printed Q 25 out

lol

Printed Q 8 out

lol

Printed Q 9 out

lol

All assets that will not be converted to cash or used up within the​ business's operating cycle or one​ year, whichever is​ greater, are called

long−term assets

net cost of inventory purchased =

net cost of inventory purchased = purchase cost of inventory - purchase returns and allowances - purchase discounts + freight in

The first step in a liquidation is to​ __________.

sell the assets

Costs are transferred from the balance sheet to the income statement as cost of goods sold when​ ________.

. finished goods are sold

Blythe Company has provided the following​ information: Sales price per unit $45 Variable cost per unit 20 Fixed costs per month ​$12,000 What is the amount of sales in dollars required for Blythe to break​ even? (Round any percentages to two decimal places and your final answer to the nearest​ dollar.)

21,598

Nancy and Peter enter into a partnership and decide to share profits and losses as​ follows: 1. The first allocation is a salary allowance with Nancy receiving $11,000 and Peter receiving $9,000. 2. The second allocation is 15​% of the​ partners' capital balances at year end. On December​ 31, 2025, the capital balances for Nancy and Peter are $82,000 and $23,000​, respectively. 3. Any remaining profit or loss is allocated equally. For the year ending December​ 31, 2025, the partnership reported a net loss of $83,000. What is​ Peter's share of the net​ loss?

46,925

The purposes of the statement of cash flows are to

A. determine ability to pay debts and dividends. B. evaluate management decisions. C. predict future cash flows.

________ represent(s) a short−term liability created by purchasing​ "on account."

Accounts Payable

Which of the following accounts will have an ending balance after the closing process is​ completed?

Accumulated Depreciation

Star Homes Inc. just recorded a transaction in its books of accounts. If this transaction increased the total liabilities by $7,000: A) assets must increase, or equity must decrease by $7,000. B) assets or equity must decrease by $7,000. C) both assets and equity must each decrease by $3,500. D) assets must decrease by $7,000.

Answer: A

A sole proprietor makes a cash withdrawal from his company. How does this transaction affect the accounting equation? A) Assets, liabilities, and equity remain the same. B) Assets decrease; equity decreases. C) Assets increase; liabilities decrease. D) Assets decrease; equity increases.

Answer: B

Caleb Brown is the sole owner of a bicycle sales and repair shop from several years. Which of the following business types would limit Caleb's personal liability exposure to the entity's debts? A) Partnership B) Limited-liability company C) Sole proprietorship D) Limited-liability partnership

Answer: B

Martin Supply Service received $1,000 cash from a customer which was owed to the business from the previous month. What is the effect of the cash receipt on the accounts of the business? A) Accounts Receivable decreases; Martin, Capital decreases. B) Cash account increases; Accounts receivable decreases. C) Accounts Payable increases; Martin, Capital decreases. D) Cash increases; Accounts Payable decreases.

Answer: B

The field of accounting that focuses on providing information for external decision makers is: A) managerial accounting. B) financial accounting. C) cost accounting. D) nonmonetary accounting.

Answer: B

Which of the following financial statements shows the changes in owner's capital during a period of time? A) income statement B) statement of owner's equity C) statement of cash flows D) balance sheet

Answer: B

Which of the following statements would be most useful if an analyst wants to know the likelihood of repayment of his debts? A) income statement B) balance sheet C) statement of owner's equity D) statement of cash flows

Answer: B

As per the ________, the entity will remain in operation for the foreseeable future. A) economic entity concept B) monetary unit assumption C) going concern assumption D) cost principle

Answer: C

From a legal perspective, a sole proprietorship: A) is an entity separate from its proprietor. B) must have at least two owners. C) is not a distinct entity from its proprietor. D) is subject to strict regulation of the SEC.

Answer: C

Hamilton Lawn Service incurred $500 as labor expense and promised to pay the labor agency within 30 days. Which of the following accounts would increase as a result of this transaction? A) Accounts Receivable B) Cash C) Accounts Payable D) Owner's Capital

Answer: C

The balance sheet is a snapshot of the entity. Which of the following items are included on the balance sheet? A) revenues B) expenses C) assets D) withdrawals

Answer: C

The formation of a partnership firm requires a minimum of: A) four partners. B) three partners. C) one partner. D) two partners.

Answer: D

The income statement presents a summary of an entity's revenues and expenses for a period of time. Which of the following statements is true of an income statement? A) There is net income when total revenues are lesser than total expenses. B) There is a net loss when total expenses are lesser than total revenue. C) There is a net loss when total expenses are greater than total liabilities. D) There is net income when total revenues are greater than total expenses.

Answer: D

Sharon Samson owns Reliable Waterworks which provides plumbing service. Transactions of Reliable Waterworks during the first year of operations are given below: A) Sharon contributed $14,000 into a new checking account for the business and recorded capital contribution. B) Paid $2,000 for equipment to be used for plumbing repairs. C) Borrowed $15,000 from a local bank and deposited the money in the checking account. D) Paid $600 as rent for the year. E) Paid $500 for plumbing supplies to be used on various jobs in the future. F) Completed a plumbing repair project for a local lawyer and received $3,500. Calculate the amount of total assets balance at the end of the first year. A) $2,500 B) $2,000 C) $29,000 D) $31,900

Answer: D Explanation: D) Bank ($14,000 + $15,000) $29,000 Cash ($3,500 - $2,000 - $600 - $500) 400 Equipment 2,000 Supplies 500 Total assets $31,900

Glorious Gloria, a florist, had the following transactions in August: Earned $2,000 as revenues on account; collected $4,000 from a customer for goods sold last month; incurred $600 of repair expense and paid cash; paid $200 to a supplier that it owed from the previous month. What is the net income in August? A) $500 B) $5,700 C) $2,700 D) $1,400

Answer: D Explanation: D) Net income = Revenue - Expenses = $2,000 - $600 = $1,400.

Sharon Samson starts a plumbing service named Reliable Waterworks. Selected transactions are described as follows: A) Sharon deposited $8,000 into a new checking account for the business and recorded the capital contribution. B) Paid $5,000 cash for equipment to be used for plumbing repairs. C) Borrowed $10,000 from a local bank and deposited the money in the checking account. D) Paid $800 rent for the year. E) Paid $300 cash for plumbing supplies to be used in future. F) Completed a plumbing repair project for a local lawyer and received $4,000 cash. Calculate the net income. A) $2,900 B) $3,700 C) $4,000 D) $3,200

Answer: D Explanation: D) Net income = Revenues - Expenses Net income = $4,000 - $800 = $3,200

Equity increases when revenues are earned.

Answer: TRUE

Mulberry Company collected​ $16,000 from one of its​ customers, the amount owed from the previous month. How does this affect the accounting equation for​ Mulberry? _?_

Assets increase by​ $16,000; assets decrease by​ $16,000.

Candle​ Shop, Inc. has net sales on account of $1,600,000. The average net accounts receivable are $640,000. Calculate the​ days' sales in​ receivables.(Use 365 days for any calculations. Round any intermediate calculations and your final answer to two decimal​ places.)

Days' Sales in Inventory = 365 / inventory turnover 365 / 1,600,000 (net sales on account) = 2.275 E -4 2.275 E -4 * 640,000 (average net accounts receivable) = 145.6 146 DAYS!

Issuance of common stock

F+

Issuance of common stock.

F+

Issuance of long-term note payable to borrow cash.

F+

Payment of cash dividend.

F-

Payment of dividends

F-

Payment of long-term debt.

F-

Overallocated manufacturing overhead is adjusted by debiting the Cost of Goods Sold account.

FALSE

When a previously declared dividend is​ paid, which of the following​ occurs?

Liabilities decrease.

Which of the following statements is​ true?

Neither a stock dividend nor a stock split will result in net gains or losses.

54) Perez Biofuels Company is preparing its statement of cash flows using the indirect method. Refer to the following information.1) Repayments on Long-Term Notes Payable $58,0002) New borrowing on Long-Term Notes Payable $19,000 Which of the following statements is accurate regarding the statement of cash flows?

Net cash used for financing activities will amount to $(39,000). 58,000 - 19,000 = -39,000

Depreciation expense

O+

Increase in Accounts Payable.

O+

Net income.

O+

Materiality concept

Principle that states significant items must conform to GAAP.

Requirement 1. What is the purpose of the statement of cash​ flows?

The purpose of the statement of cash flows is to show where cash came from and how cash was spent during the period.

Dominic and Morgan are partners. Dominic has a capital balance of​ $370,000 and Morgan has a capital balance of​ $235,000. Morgan sells​ $85,000 of his ownership to Lance. Which of the following is TRUE of the items in the balance​ sheet?

The total equity remains unchanged.

Last-in, first-out (LIFO)

Treats the most recent/newest purchases as the first units sold.

First-in, first-out (FIFO)

Treats the oldest inventory purchases as the first units sold.

Requirement 1. Compute the trend analysis for net sales and net income​ (use 2020 as the base​ year). ​

Trends in net sales and net income are both upward, which is positive.

Employer FICA is paid by the employer and recorded as a payroll tax expense.

True

Mutual agency means that any partner can legally bind the other partners and the partnership to business contracts within the scope of the​ business's regular operations.

True

No single ratio tells the whole picture of any​ company's performance.

True

State unemployment compensation tax​ (SUTA) is paid by the employer and is not deducted from an​ employee's gross earnings.

True

The cash paid for the purchase of equipment will typically be shown in the investing activities section of the statement of cash flows.

True

The direct method restates the income statement in terms of cash.

True

Philadelphia Acoustics builds innovative speakers for music and home theater systems. Identify each cost as variable​ (V), fixed​ (F), or mixed​ (M), relative to number of speakers produced and sold.

Units of production depreciation on routers used to cut wood enclosures. V Wood for speaker enclosures. V Patents on crossover relays. F Total compensation to salesperson who receives a salary plus a commission based on meeting sales goals. M Crossover relays. V Straight-line depreciation on manufacturing plant. F Grill cloth. V Insurance on the corporate office. F Glue V Quality inspector's salary F

Which of the following is an advantage of a limited liability company compared to a​ partnership?

Unlike a​ partnership, the members of a limited liability company are not personally liable for the​ business's debts.

Requirement 6. Should you invest in the common stock of WRS Athletic​ Supply, Inc.? Fully explain your final decision.

WRS​'s trend of net​sales, net​income, inventory​turnover, earnings per​share, and​times-interest-earned have improved. All other measures have held steady or improved. There are no apparent trouble spots in WRS​'s data.​Therefore, invest in WRS for increasing dividends and steady growth.

Incurred and paid Web site​ expenses, $2,700.

Website Expenses 2,700 Cash 2,700

Allocated manufacturing overhead to​ jobs, 220​% of direct labor costs.

Work-in-Process Inventory 17,160 Manufacturing Overhead 17,160

Used in​ production: direct​ materials, $5,500​; indirect​ materials, $4,500.

Work-in-Process Inventory 5,500 Manufacturing Overhead 4,500 Raw Materials Inventory 10,000

Incurred manufacturing wages of $13,000​, 60​% of which was direct labor and 40​% of which was indirect labor.

Work-in-Process Inventory 7,800 Manufacturing Overhead 5,200 Wages Payable 13,000

Which of the following companies is most likely to use process​ costing?

a breakfast cereal company

A company sold merchandise with a cost of $240 for $410 on account. The seller uses the perpetual inventory system. The entry to record the cost of merchandise sold would include​ ________.

a debit to Cost of Goods Sold and a credit to Merchandise Inventory for $240

Which of the following is a period​ cost?

administrative cost

Virginia Company uses the indirect method to prepare the statement of cash flows. Refer to the following section of the comparative balance​ sheet: Virginia Company Comparative Balance Sheet December​ 31, 2024 and 2023 2024 2023 Increase​ /(Decrease) Accounts Payable ​$4,000 ​$6,000 ​$(2,000) Accrued Liabilities ​2,000 ​1,000 ​1,000 Long−term Notes Payable ​84,000 ​90,000 ​(6,000) Total Liabilities ​$90,000 ​$97,000 ​$(7,000) How will the change in Accounts Payable be shown on the statement of cash​ flows?

as a deduction from Net Income in the operating activities section

Contribution margin ratio is equal to​ ________.

contribution margin divided by net sales revenue

On June​ 30, Caroline, Inc. finished Job 750 with total job costs of $4,500 and transferred the costs to Finished Goods Inventory. On July​ 6, Caroline sold goods from Job 750 to a customer for $5,600 cash. Which of the following is the correct entry needed to record the revenue​ earned? Assume the perpetual inventory system is used.

debit Cash $5,600 and credit Sales Revenue

At the beginning of the​ year, Judge Manufacturing had the following account​ balances: Work−in−Process Inventory ​20,000 Finished Goods Inventory 8,000 Manufacturing Overhead 0 Cost of Goods Sold 0 Sales Revenue 0 The following additional details are provided for the​ year: Direct materials placed in production $82,500 Direct labor incurred 191,600 Manufacturing overhead incurred 301,600 Manufacturing overhead allocated to production 297,100 Cost of jobs completed and transferred to finished goods 501,000 Cost of Goods Sold 500,000 The ending balance in the Finished Goods Inventory account is a​ ________.

debit of 9,000

The entry to record the purchase of raw materials on account would include a​ ________.

debit to the Raw Materials Inventory account

Kenny and Jeff form a partnership. During the​ year, Kenny and Jeff withdraw​ $33,000 and​ $22,000, respectively. Which of the following will be included in the journal entry to record the​ withdrawals?

debit to​ Kenny, Withdrawals for​ $33,000

The relationship between total liabilities and total assets is the​ ________.

debt ratio

Accounting for stated value common stock is identical to accounting for par value stock.

false

California Corp. uses the indirect method to prepare the statement of cash flows. Refer to the following section of the comparative balance​ sheet: California Corp. Comparative Balance Sheet December​ 31, 2024 and 2023 2024 2023 Increase​ /(Decrease) Accounts Payable ​$8,000 ​$9,000 ​$(1,000) Accrued Liabilities ​3,000 ​1,500 ​1,500 Long−term Notes Payable ​56,000 ​60,000 ​(4,000) Total Liabilities ​$67,000 ​$70,500 ​$(3,500) The change in Accrued Liabilities is shown as a negative cash flow in the adjustments to net income.

false

Fixed cost per unit is assumed to be constant within a particular relevant range of activity.

false

For the accounting equation to​ balance, a transaction must affect both sides of the equation. _?_

false

If a new partner is admitted by giving more cash than he or she received in​ interest, then there will be a bonus to the new partner.

false

Sunshine Blender Company sold 3,000 units in October at a sales price of $50 per unit. The variable cost is $15 per unit. Calculate the total contribution margin.

false

The Salaries Payable account is a permanent account.

false

The asset turnover ratio is a way to evaluate how well a company can pay its short−term liabilities.

false

The beginning balance in the capital account of Woodlands Technologies Company was $88,000. The revenues and expenses amounted to $55,000 and $43,000​, respectively. The owner made no additional investments and no withdrawals during the year. The total​ owner's equity at the end of the year will be $143,000.

false

The breakeven point is the point where the sales revenues are equal to the fixed costs.

false

The cash flows from investing activities is completed by reviewing the long−term liabilities section of the balance sheet.

false

The cost of direct materials cannot be easily traced to the manufactured​ product, and​ therefore, it is a component of manufacturing overhead.

false

The declaration of a cash dividend does not create an obligation for the corporation.

false

The financing activities section of the statement of cash flows is often considered the most important section because it details the​ day-to-day cash receipts and payments of a company.

false

The gross profit percentage is an indicator of how well a company is positioned to pay off its short−term liabilities

false

​Normally, companies with low gross profit percentages will have low asset turnover.

false Just because a company has a low gross profit percentage does not mean that they have a low asset turnover.

Unexpected or inconsistent movements among​ sales, merchandise​ inventory, and receivables reflect normal market conditions and do not pose red flags in financial statements.

false Unexpected or inconsistent movements among​ sales, merchandise​ inventory, and receivables reflect normal market conditions and DO POSE RED FLAGS in financial statements.

Which of the following is paid by the employer​ only?

federal unemployment tax

based on most recent purchase

first−​in, first−out FIFO

gross profit percentage =

gross profit / net sale revenue

Petrous Company incurs both fixed and variable production costs. Assuming that production is within the relevant​ range, if volume goes up by 24​%, then the total variable costs would​ ________.

increase by 24%

Jeong Company incurs both fixed and variable production costs. Assuming that production is within the relevant​ range, if volume goes up by 26​%, then the total costs would​ ________.

increase by an amount less than 26​%

Manufacturing overhead is also referred to as​ ________.

indirect manufacturing costs

Which of the following would be included as manufacturing overhead for a manufacturing​ company?

indirect materials cost

One of the assumptions of cost−volume−profit ​(CVP) analysis is that there are no changes in the​ ________.

inventory levels

The​ ________ section of the statement of cash flows includes increases and decreases in long−term assets.

investing activities

In preparing a statement of cash flows using the indirect​ method, the Depreciation Expense​ ________.

is added back as an adjustment to Net Income in the operating activities section

Which of the following is an advantage of the corporate form of​ business?

limited liability of stockholders

​A(n) ________ must carry large insurance policies to protect the public in case the partnership is found guilty of malpractice.

limited liability partnership

Notes Payable due in two years are classified as​ ________.

long−term liabilities

Selected data for three companies are given below. All inventory amounts are ending balances and all amounts are in millions. Using the above​ data, determine the company type. Identify each company as a service​ company, merchandising​ company, or manufacturing company.

manufacturing company. ​ service company. ​ merchandising company. *SEE GOOGLE DOC FOR THE INFO*

The​ price/earnings ratio shows the​ ________.

market price of​ $1 of earnings EQUATION IS = market price per share of common stock / earnings per share

adjustment entry

merch inv. balance before - actual merch inv. on hand

Canada Company needs to purchase a property to build their headquarters. An investor is willing to exchange land with a market value of​ $700,000 for shares of common stock. On the statement of cash​ flows, this transaction would be shown as part of​ ________.

non−cash investing and financing activities

Allen Services purchased 20 delivery vehicles by issuing a 20−year installment note payable for​ $720,000. On the statement of cash​ flows, this transaction would be shown in the​ ________.

non−cash investing and financing activities section

Which of the following is a period cost for a manufacturing​ company?

office rent

Which of the following sections of the statement of cash flows is presented differently between the direct method and indirect​ method?

operating activities

Period costs are the​ ________.

operating costs that are expensed in the accounting period in which they are incurred.

​A(n) ________ does NOT require any permission from the state to be set up.

partnership

The following data are adapted from the financial statements of Beth's Shops, Inc.: Prepare Beth's condensed balance sheet as of December​ 31, 2024

photo

Which of the following is a cash outflow for a financing activity on the statement of cash​ flows?

purchase of treasury stock

Preferred stockholders​ ________.

receive a dividend preference over common stockholders

Variable cost per​ unit, within the relevant​ range, will​ ________.

remain the same as production levels change

Which of the following would be considered a product cost for a manufacturing​ company?

salary of the production manager

Which of the following actions will increase the Common Stock​ account?

stock dividend declared and distributed

When a job order costing system is​ used, actual manufacturing overhead costs are debited to​ ________.

the Manufacturing Overhead account

Which of the following would most likely be accounted for using a job order costing​ system?

the creation of wedding photography portraits

Which of the following correctly describes the term cost​ driver?

the primary factor that causes a cost to be incurred

Which of the following is a reason for a company to announce a stock​ split?

to decrease the market price at which the stock is trading

Contribution margin is the difference between net sales revenue and variable costs.

true

Ending inventory is calculated by multiplying the number of units on hand by the unit cost.

true

Establishing controls for efficiency of the payroll process is one of the main key controls for payroll.

true

Factory​ rent, as well as factory property taxes and​ insurance, are included in manufacturing overhead.

true

Financing activities on the statement of cash flows affect the long−term liability and equity accounts.

true

Stockholders of a corporation are not personally liable for the​ corporation's debt.

true

The non−cash investing and financing activities section of the statement of cash flows appears as a separate schedule of the statement of cash flows or in the notes to the financial statements.

true

The post−closing trial balance shows the updated​ Owner, Capital balance.

true

The times−interest−earned ratio measures the number of times earnings before interest and taxes can cover interest expense.

true

The Accounts Receivable account is a permanent account.

true

The Depreciation Expense account is a temporary account.

true

The acid−test ratio measures a​ company's ability to pay all its current liabilities if they came due immediately.

true

The statement of​ partners' equity shows the changes in each​ partner's capital account for a specific period of time.

true

The​ Owner, Capital account is a permanent account.

true

Total variable costs change in direct proportion to changes in the volume of production.

true

Upon​ liquidation, if there is a sale of assets at a​ loss, the loss must be allocated to the​ partners' capital accounts based on their profit−and−loss−sharing ratio.

true

When a corporation issues no−par ​stock, it debits the asset received and credits the stock account.

true

When a corporation issues stock at par​ value, the Cash account is debited and the Common Stock account is credited for an amount equal to the number of shares issued times the par value per share.

true

Which of the following costs change in total in direct proportion to a change in​ volume?

variable costs

​Connecticut, Inc. Comparative Balance Sheet December​ 31, 2025 and 2024 2025 2024 ​Increase/(Decrease) Cash $28,000 $19,000 $9,000 Accounts Receivable 35,000 39,000 ​(4,000​) Merchandise Inventory 56,000 26,000 30,000 Plant and Equipment 126,000 90,000 36,000 Accumulated Depreciation−Plant and Equipment ​(46,000​) ​(41,000​) ​(5,000​) Total Assets $199,000 $133,000 $66,000 Additional information provided by the company includes the​ following: 1. Equipment was purchased for $70,000 with cash. 2. Equipment with a cost of $34,000 and accumulated depreciation of $7,500 was sold for $46,000. What was the amount of net cash provided by​ (used for) investing​ activities?

​$(24,000​) 1. Equipment was purchased for $70,000 with cash. 2. Equipment with a cost of $34,000 and accumulated depreciation of $7,500 was sold for $46,000. 46,000 - 70,000 = -24,000 since the 70,000 was purchased with cash and only sold for 46,000, so the 24,000 has got to come from investing to make up for the loss difference.

McCoy Company provides plumbing services. Transactions during the first year of operations are provided below. ​a) Received​ $13,000 cash from the owner Sharon McCoy. ​b) Paid​ $1,100 cash for equipment to be used for plumbing repairs. ​c) Borrowed​ $14,000 from a local bank and deposited the money in the checking account. ​d) Paid​ $300 rent for the year. ​e) Purchased​ $200 of office supplies by cash. ​f) Completed a plumbing repair project for a local lawyer and received​ $3,200 cash. Calculate the amount of total liabilities at the end of the first year.

​$14,000

The equity of Alliance Company is​ $100,000 and the total liabilities are​ $90,000. The total assets are​ ________.

​$190,000

Hank earns​ $18.50 per hour with time−and−a−half for hours in excess of 40 per week. He worked 44 hours at his job during the first week of​ March, 2024. Hank pays income taxes at​ 15% and​ 7.65% for OASDI and Medicare. All of his income is taxable under FICA. Determine​ Hank's net pay for the week.​ (Do not round any intermediate​ calculations, and round your final answer to the nearest​ cent.)

​$658.25 40 x $18.50 = $740 1.5 x $18.50 = $27.75 10 overtime x $27.75 = $277.5 $740 + $277.5 = $1,017.5 income taxes -> $1,017.5 x 7.65% = 77.84 $1,017.5 x 15% = 152.63 $1,017.5 - 77.84 - 152.63 = 787.03

The formula for calculating the cash ratio is​ ________.

​(Cash + Cash​ equivalents) / Total current liabilities

A​ 15% increase in production volume will result in a​ ________.

​15% increase in total variable costs

John and Anne are partners. John has a capital balance of​ $48,000 and Anne has a capital balance of​ $35,000. John sells​ $13,000 of his ownership to Bailey. Which of the following is TRUE of the journal entry to admit​ Bailey?

​Bailey, Capital will be credited for​ $13,000.

The Sarbanes-Oxley Act (SOX) requires companies to review internal control and take responsibility for the accuracy and completeness of their financial reports.

Answer: TRUE

The guidelines for accounting information are called Generally Accepted Accounting Principles (GAAP).

Answer: TRUE

The heading of a balance sheet will show the date as a specific date, not a period of time.

Answer: TRUE

The statement of owner's equity informs users about how much of the earnings were kept and reinvested in the company.

Answer: TRUE

Granger Cards is a manufacturer of greeting cards. Classify its costs by matching the costs to the terms.

Artists' wages ----- Direct labor Wages of materials warehouse workers---- Indirect labor Paper ------ Direct materials Depreciation on manufacturing equipment----- Other manufacturing overhead Manufacturing plant manager's salary---- Indirect labor Property taxes on manufacturing plant---- Other manufacturing overhead Glue for envelopes--- Indirect materials

Stock issued at amounts in excess of par value results in a gain that is reported on the income statement.

false

The inventory of a merchandising company consists of Raw Materials​ Inventory, Work−in−Process ​Inventory, and Finished Goods Inventory.

false

The last−​in, first−out (LIFO) costing system is permitted under International Financial Reporting Standards​ (IFRS).

false

The permanent accounts—​assets, ​liabilities, and​ Owner, Capital accounts—are closed at the end of each accounting period.

false

When computing investing cash​ flows, it is helpful to evaluate the T−accounts for each long−term liability.

false

When stock is issued for assets other than​ cash, the transaction is always recorded at the market value of the stock issued.

false

While preparing a statement of cash flows using the indirect​ method, an increase in current assets is added to net income to arrive at net cash provided by operating activities.

false

For the year ended December​ 31, 2025, the Statement of Cash Flows for Mississippi Family Auto Supply shows the following​ information: Net Cash Used by Operating​ Activities, ​$(70,000​); Net Cash Provided by Investing​ Activities, $49,000​; and Net Cash Provided by Financing​ Activities, $41,000. Cash has increased by $160,000.

false ----- 49,000 + 41,000 = 90,000 90,000 - 70,000 = 20,000

​Days' sales in inventory measures how quickly a company can collect its receivables.

false Days sales of inventory (DSI) is the average number of days it takes for a firm to sell off inventory.

A general partner in a limited partnership​ ________.

has unlimited personal liability in the partnership

purchase discount

the amount of the invoice - the returns and allowances.

Which of the following sections of the statement of cash flows includes activities that increase and decrease long−term liabilities and​ stockholders' equity?

the financing activities section

When an existing partner sells his interest to another party in a personal transaction​ ________.

the journal entry simply debits the withdrawing​ partner's capital account and credits the new​ partner's capital

Which of the following sections of the statement of cash flows include activities that affect current assets and current liabilities on the balance​ sheet? (Assume the indirect method is​ used.)

the operating activities section

If a​ partner's capital account is credited with the amount that he or she contributed in​ cash, which of the following financial statements will be​ affected?

the statement of​ partners' equity

Which of the following is a reason why many companies require a photo ID when employees pick up their​ paychecks?

to avoid writing a paycheck to a fictitious person

A law firm provides legal services for clients who do not pay immediately. As a result of this​ transaction, assets and revenues increase.

true

A small stock​ dividend, a large stock dividend and a stock split have no effect on total assets.

true

A stock split decreases par value per​ share, whereas stock dividends do not affect par value per share.

true

Admission of a new partner to a​ partnership, by purchasing an existing​ partner's interest, simply transfers capital from one​ partner's account to another.

true

An S corporation is a corporation with 100 or fewer stockholders that can elect to be taxed as a partnership.

true

Assets are something of value that the business owns or has control of.

true

CVP analysis assumes that the sales price per unit does not change as volume changes.

true

In a manufacturing​ company, advertising and marketing costs are examples of period costs.

true

In a manufacturing​ company, the salary of the sales staff is an example of a period cost.

true

In a manufacturing​ company, wages and benefits of factory managers are treated as product costs.

true

In a​ partnership, a person can become a partner by purchasing an existing​ partner's interest.

true

Liabilities represent​ creditors' claims on the​ business's assets.

true

Manufacturing companies produce their own​ products, but merchandising companies do not.

true

Merchandise inventory and prepaid expenses are excluded from the acid−test ratio.

true

Repair and maintenance costs for manufacturing equipment are product costs.

true

Selling and administrative expenses are subtracted from gross profit to obtain operating income.

true

Stated value stock is no−par stock that has been assigned an amount similar to par value.

true

Stock dividends have no effect on the total amount of​ stockholders' equity.

true

The closing process helps in measuring each​ period's net income separately from all other periods.

true

The current ratio is calculated as total current assets divided by total current liabilities.

true

The declaration date is the date the corporation prepares a journal entry to record that stockholders will receive dividend checks.

true

The dividend yield can be calculated for both common and preferred stockholders.

true

The four types of events that affect equity are​ owner's capital,​ owner's withdrawals,​ revenues, and expenses.

true

The issue price is the price the stock initially sells for the first time it is sold.

true

The par value of a stock has no relation to the market value.

true

The perpetual inventory system keeps a running computerized record of inventory and cost of goods sold.

true

The process of going out of business by selling the​ entity's assets, paying its​ liabilities, and distributing any remaining cash to the partners based on their equity balances is known as liquidation.

true

The sales level at which operating income is zero is called the breakeven point.

true

Washington Company is preparing its statement of cash flows using the indirect method. Refer to the following portion of the comparative balance​ sheet: Washington Company Comparative Balance Sheet December​ 31, 2025 and 2024 2025 2024 ​Increase/(Decrease) Accounts Payable $9,000 $5,000 ​$4,000 Accrued Liabilities 4,000 1,300 2,700 Long−term Notes Payable 58,000 67,000 ​(9,000​) Total Liabilities $71,000 $73,300 ​$(2,300​) Additional information provided by the company includes the​ following: 1. During​ 2025, the company repaid $37,000 of long−term notes payable. 2. During​ 2025, the company borrowed $28,000 on a new long−term note payable. Based on the above information​ only, what amount of net cash flow would be shown in the financing section of the statement of cash​ flows?

$(9,000​) because Long−term Notes Payable goes with financial ----------------------------------- 1. During​ 2025, the company repaid $37,000 of long−term notes payable. 2. During​ 2025, the company borrowed $28,000 on a new long−term note payable. 37,000 - 28,000 = 9,000 ALSO the question tells us (9,000) where it says Long-term Notes payable.

Performed services for​ $3,000 on​ account; received cash on​ account, $6,000; paid​ $900 for repair​ expense; paid​ $1,900 to a supplier that it owed from the previous month. What is the combined effect on Cash of these June​ transactions? _?_

$3,200 increase

​Tim's gross pay for this month is​ $8,850. His gross year−to−date ​pay, prior to this​ month, totaled​ $127,000. What is the amount of FICA tax withheld from​ Tim's pay for this​ month? (Assume an OASDI rate of​ 6.2%, applicable on the first​ $132,900 earnings, and a Medicare rate of​ 1.45%, applicable on all earnings. Do not round any intermediate​ calculations, and round your final answer to the nearest​ cent.)

$494.13

​Brad's gross pay for the month is $8,400. His deduction for federal income tax is based on a rate of 24​%. He has no voluntary deductions. His year−to−date pay is under the limit for OASDI. What is​ Brad's net​ pay? (Assume a FICA—OASDI Tax of 6.2​% and FICA—Medicare Tax of 1.45​%. Do not round any intermediate​ calculations, and round your final answer to the nearest​ dollar.)

$5,741 Gross Pay $8,400 Less: OASDI 520.8 Less: Medicare 121.8 Less: Federal Income Tax 2,016 Net Pay $5,741.4

​Aaron, Inc. estimates direct labor costs and manufacturing overhead costs for the coming year to be $750,000 and $510,000​, respectively. Aaron allocates overhead costs based on machine hours. The estimated total labor hours and machine hours for the coming year are 20,000 hours and 8,000 ​hours, respectively. What is the predetermined overhead allocation​ rate? (Round your answer to the nearest​ cent.)

$63.75 per machine hour 510,000 / 8,000

​Sybil, Inc. uses a predetermined overhead allocation rate to allocate manufacturing overhead costs to jobs. The company recently completed Job 300X. This job used 15 machine hours and 3 direct labor hours. The predetermined overhead allocation rate is calculated to be $46 per machine hour. What is the amount of manufacturing overhead allocated to Job 300X using machine hours as the allocation​ base?

$690

Mezine​, Inc. sells a product with a contribution margin of $15 per unit. Fixed costs are $2,850 per month. How many units must Mezine sell to break​even? begin by showing the formula and then entering the amounts to calculate the units Mezine must sell to break even.

(Fixed costs 2580 + Target profit. 0 ) ÷ CM per unit. 15 = Required sales in units. 190

Requirement 1. Compute earnings per share​ (EPS) for 2024 for Excel​'s. Round to the nearest cent. Begin by selecting the formula to calculate Excel​'s ​Companies' EPS. Then enter the amounts and calculate the EPS for 2024 Requirement 2. Compute Excel​'s ​Companies' price/earnings ratio for 2024. The market price per share of Excel​'s stock is $17.50. Begin by selecting the formula to calculate Excel​'s ​Companies' price/earnings ratio. Then enter the amounts and calculate the EPS for 2024. Requirement 3. What do these results mean when evaluating Excel​'s ​Companies' profitability?

(Net income - Preferred dividends) ÷ Weighted avg number of CSO COMMON SHARES OUTSTANDING = EPS EARNINGS PER SHARE ($14,100 - $0) ÷ $15,000 = $0.94 Market price per share of CS ÷ Earnings per share = Price/earnings ratio $17.50 ÷ $0.94 = 18.62 ​'s ​Companies' price/earnings ratio for 2024 means that the​company's stock is selling at 18.62 TIMES ONE YEAR'S EARNINGS PER SHARE. This is HIGH. This indicates that investors are paying a HIGHER PRICE for the stock compared to its​earnings, EVEN MORE SO than the industry average. EXPLAINED: Net income - preferred dividends / weighted average number of common shares outstanding

Which of the following would be considered cash inflows from financing​ activities?

- Cash received from the issuance of common stock - Cash received from issuing​ long-term bonds

LIFO Facts

- The last units in are assumed to be the first units sold. - This method leaves the oldest costs in ending inventory. - LIFO is an assumption about how costs flow.

Q−dot Manufacturing uses a predetermined overhead allocation rate based on direct labor hours. It has provided the following information for the​ year: Manufacturing overhead costs allocated to production $189,000 Actual direct materials cost $560,000 Actual direct labor cost $2,470,000 Actual direct labor hours 9,090 direct labor hours Estimated machine hours 180,000 machine hours Based on the above​ information, calculate Q−​dot's predetermined overhead allocation rate.​ (Round your answer to two decimal​ places.)

. $20.79 per direct labor hour Manufacturing overhead costs allocated to production / Actual direct labor hours= 189,000 / 9,090 = 20.79

The journal entry to issue $600 of direct materials and $30 of indirect materials to production involves​ debit(s) to the​ ________.

. Work−in−Process Inventory account for $600 and Manufacturing Overhead account for

Rios Corporation reports costs for the year as​ follows: Direct Materials Used $370,000 Wages to Line Workers 145,000 Office Rent 62,500 Indirect Materials Used 640,000 How much is the total product costs for the​ year?

1,155,000 add all butdontaddRENT

Gardner Machine Shop estimates manufacturing overhead costs for the coming year at $307,000. The manufacturing overhead costs will be allocated based on direct labor hours. Gardner estimates 5,000 direct labor hours for the coming year. In​ January, Gardner completed Job​ A33, which used 70 machine hours and 24 direct labor hours. What was the amount of manufacturing overhead allocated to Job​ A33? (Round any intermediate calculations to the nearest​ cent, and your final answer to the nearest​ dollar.)

1,474 307,000 / 24 = 12791.67 + 5000 = close?

Disadvantages of a partnership compared to a sole proprietorship and a corporation

1. Mutual agency and unlimited liability create personal obligations for each partner 2. Partnership agreement may be difficult to formulate 3. Relations among partners may be fragile

Seven items that would need to be incorporated into the written partnership agreement

1. Name, location, and nature of business 2. Name, capital contribution, and duties of each partner 3. Procedures for admitting a new partner 4. Method of sharing profits and losses among the partners 5. Procedures for withdrawal of assets by the partners 6. Procedures for withdrawal of a partner from the partnership 7. Procedures for liquidating the partnership

Advantages of a partnership over a sole proprietorship and a corporation

1. Partnerships bring together the abilities of more than one person 2. Less expensive to organize than a corporation 3. Partners working well together can add more value than by working alone 4. No double taxation of partnerships 5. Partnerships can raise more money than a sole proprietor

The financial statements for​ Stephens' Electric Company include the following​ items: 2025 2024 Cash ​$56,000 ​$54,000 Cash Equivalents 24,500 15,000 Net Accounts Receivable 27,000 36,000 Merchandise Inventory 83,000 66,000 Total Assets 525,000 548,000 Accounts Payable 37,500 32,000 Salaries Payable 25,000 18,000 Long−term Note Payable 63,000 59,000 Income From Operations 132,500 119,000 Interest Expense 34,000 32,000 Compute the 2024 cash ratio.​ (Round your answer to two decimal​ places.)

1.38

Hernando​ Manufacturing, Inc. reported the following information for the​ year: Number of Units Produced 150,000 Number of Units Sold 63,000 Cost of Goods Manufactured $270,000 Cost of Goods Sold 53,500 Sales Revenue 130,000 Gross Profit 72,400 Operating Expense 726,000 What was the unit product​ cost? (Round your answer to the nearest​ cent.)

1.80 Cost of Goods Manufactured $270,000 / Number of Units Produced 150,000 = 1.8

A cellphone service provider charges $6 per month and $0.40 per minute per call. If a​ customer's current bill is $55​.00, how many minutes did the customer​ use? (Round any intermediate calculations and your final answer to the nearest whole​ minute.)

123 mins

The financial statements for Uptown Service Company include the following​ items: 2025 2024 Cash $45,500 $41,000 Short−term Investments 28,000 20,000 Net Accounts Receivable 56,000 55,000 Merchandise Inventory 161,000 49,000 Total Assets 531,000 554,000 Accounts Payable 134,500 126,000 Salaries Payable 17,000 12,000 Long−term Note Payable 56,000 60,000 Compute working capital for 2025.

139,000

A company reports total assets of $930,000 and​ stockholders' equity of $540,000. Calculate the debt ratio.​ (Round your answer to two decimal​ places.)

14.94%

fire​ Cat, Inc. selected cost data for the year are shown​ below: Cost of Goods Manufactured $146,400 Work−in−Process ​Inventory, Jan. 1 18,500 Work−in−Process ​Inventory, Dec. 31 22,500 Direct Materials Used 15,600 What is the total of manufacturing costs incurred by Fire​ Cat, Inc. during the​ year?

1500,400 Work−in−Process ​Inventory, Jan. 1 18,500 MINUS Work−in−Process ​Inventory, Dec. 31 22,500 = 4000 4000 + Cost of Goods Manufactured $146,400 = 1500,400

​Elephant, Inc.'s cost of goods sold for the year is $2,200,000​, and the average merchandise inventory for the year is $129,000. Calculate the inventory turnover ratio of the company.​ (Round your answer to two decimal​ places.)

17.05 times

​Belstone, Inc. is a merchandiser of stone ornaments. It sold​ 15,000 units during the year. The company has provided the following​ information: Sales Revenue $515,000 Purchases​ (excluding Freight​ In) 327,000 Selling and Administrative Expenses 33,500 Freight In 15,900 Beginning Merchandise Inventory 41,500 Ending Merchandise Inventory 56,000 How much is the gross profit for the​ year?

186,600 Total Revenue - Total Expenses = Profit. Profit Sales Revenue $515,000 - Purchases​ (excluding Freight​ In) 327,000 = 188000 188000 - Freight In 15,900 = 172100 Beginning Merchandise Inventory 41,500 - Ending Merchandise Inventory 56,000 = 14500 172100 + 14500 = 186600

​Harry, Tony, and Liza run a partnership firm and share in the profits​ 1:3:2, respectively. In the process of​ liquidation, the partnership sells non−cash ​assets, having a book value of $78,000​, for $93,000. What would be the amount credited to​ Harry's capital account from his share of the gain on sale of​ assets?​ (Do not round intermediary calculations and round the final answer to the nearest whole​ dollar.)

2,500

Kim​ Airedale, a manager of​ Waggers, Inc., was reviewing the water bills of a dog daycare and spa. She determined that its highest and lowest bills of $3,800 and $2,800 were incurred in the months of May and​ November, respectively. If 500 dogs were washed in May and 100 dogs were washed in​ November, what was the variable cost per dog associated with the​ company's water​ bill? (Round your answer to the nearest​ cent.)

2.50 (3,800 - 2,800 = 1,000) / (500-100= 400) = 1,000 / 400 = 2.5

​McLeod, Inc. incurred fixed costs of $350,000. Total​ costs, both fixed and​ variable, are $500,000 when 51,000 units are produced. It sold 34,000 units during the year. Calculate the variable cost per unit.​ (Round your answer to the nearest​ cent.)

2.94

A corporation used $34,000 of direct materials. It incurred $73,000 in direct labor costs and $113,500 in manufacturing overhead costs during the period. What is the cost of goods manufactured if the beginning and ending Work−in−Process Inventories were $28,500 and $20,000​, ​respectively?

229,000 sub 28,500 - 20,000 = 8,500 now add all numbers :)

Sanchez Company reports the following costs for the​ year: Direct Materials Used $150,000 Direct Labor Incurred 200,000 Manufacturing Overhead Incurred 125,000 Selling and Administrative Expenses 235,000 How much are Sanchez​'s period​ costs?

235,000 Selling and Administrative Expenses 235,000

Closet Links Clothing Company provided the following manufacturing costs for the month of​ June: Direct labor cost $138,000 Direct materials cost 89,000 Equipment depreciation ​(straight−​line) 24,000 Factory insurance 14,000 Factory​ manager's salary 12,400 ​Janitor's salary 5,000 Packaging costs 18,200 Property taxes 15,000 From the above​ information, calculate Closet​ Link's total variable costs.

245,000 Direct material cost + direct labour cost + package cost = total variable costs Direct labor cost $138,000 Direct materials cost 89,000 Packaging costs 18,200

​Albert, Billy, and Cathy share profits and losses of their partnership in a​ 2:5:3, ratio respectively. If the net income is​ $50,000, calculate​ Billy's share of the profits.​ (Do not round any intermediate calculations. Round the final answer to the nearest​ dollar.)

25,000

The following information relates to Carried Away Hot Air​ Balloons, Inc.: Advertising Costs $15,600 Sales Salary 13,000 Sales Revenue 490,000 ​President's Salary 56,000 Administrative Office Rent 61,500 Manufacturing Equipment Depreciation 2,000 Indirect Materials Used 8,200 Indirect Labor 14,600 Factory Repair and Maintenance 760 Direct Materials Used 28,280 Direct Labor 33,000 Delivery Vehicle Depreciation 960 Administrative Salaries 24,600 How much was Carried​ Away's manufacturing​ overhead?

25,560 Indirect Materials Used 8,200 Indirect Labor 14,600 Factory Repair and Maintenance 760 Delivery Vehicle Depreciation 960 *close to the # may have to round up a little lol

Harmony Company sells hand−knit scarves. Each scarf sells for $30. The company pays $40 to rent vending space for one day. The variable costs are $11 per scarf. How many scarves should the company sell each day in order to break​ even? (Round your answer up to the nearest whole​ scarf.)

3 30- 40 = 10 10/ 40 =.25 .25 x 11 = 2.75?????

Hometown​ Grocery, Inc. has 43,000 shares of common stock outstanding and 3,000 shares of preferred stock outstanding. The common stock is $8 par​ value; the preferred stock is 5​% noncumulative with a $100 par value. On October​ 15, 2024, the company declares a total dividend payment of $48,000. What is the amount of dividend that will be paid for each share of common​ stock? ​(Round your answer to the nearest​ cent.)

3,440.00

The phone bill for a corporation consists of both fixed and variable costs. Refer to the four−month data below and apply the high−low method to answer the question. Minutes Total Bill January 470 $4,000 February 220 $2,690 March 170 $2,630 April 310 $2,855 If the company uses 380 minutes in​ May, how much will the total bill​ be? (Round any intermediate calculations to the nearest cent and your final answer to the nearest​ dollar.)

3,589

Louisiana Company uses the indirect method to prepare its statement of cash flows. Refer to the following portion of the comparative balance​ sheet: Louisiana Company Comparative Balance Sheet December​ 31, 2025 and 2024 2025 2024 ​Increase/(Decrease) Common Stock $34,000 $2,300 $31,700 Retained Earnings 123,000 77,000 46,000 Treasury Stock ​(12,000​) ​(8,300​) ​(3,700​) Total Equity $145,000 $71,000 $74,000 ​Note: 1. There were no stock retirements during the year. 2. There were no sales of treasury stock during the year. Compute the cash flow from transactions involving treasury stock

3,700 negative cash flow because Treasury Stock is in () meaning -

Nancy and Betty enter into a partnership agreement where they decide to share profits according to the following​ rules: ​(a) Nancy and Betty will receive salaries of​ $1,600 and​ $11,500 respectively as the first allocation. ​(b) The next allocation is based on​ 20% of each​ partner's capital balances. ​(c) Any remaining profit or loss is to be allocated completely to Betty. The​ partnership's net income for the first year is​ $50,000. Nancy's capital balance is​ $91,000 and​ Betty's capital balance is​ $9,000 at the end of the year. Calculate the share of​ profit/loss to be allocated to Betty.

30,200

At the beginning of the​ year, Berkshire Manufacturing had the following account​ balances: Work−in−Process Inventory ​2,000 Finished Goods Inventory ​8,000 Manufacturing Overhead 0 Cost of Goods Sold 0 Sales Revenue 0 The following additional details are provided for the​ year: Direct materials placed in production $83,000 Direct labor incurred 190,000 Manufacturing overhead incurred 300,000 Manufacturing overhead allocated to production 295,000 Cost of jobs completed and transferred 503,000 Sales revenue 759,000 Cost of goods sold​ (before adjustment) 442,700 Calculate the gross profit Berkshire will report for the year. A.

311,300

Emeka Company has provided the following​ information: Sales price per unit $46 Variable cost per unit 14 Fixed costs per month $16,000 Calculate the contribution margin per unit.

32 46- 14 = 32

Zander Company has fixed costs of $16,000. The​ company's contribution margin ratio is 46​%. What is the breakeven point in sales​ dollars? (Round your answer to the nearest​ dollar.)

34,783 16,000 / .46 = 34,783

Titus​ Manufacturing, Inc. provided the following information for the​ year: Purchases — Direct Materials $90,000 Plant Utilities and Insurance 66,500 Indirect Materials 11,760 Indirect Labor 4,970 Direct Materials Used in Production 96,000 Direct Labor 119,000 Depreciation on Factory Plant​ & Equipment 7,000 The inventory account balances as of January 1 are given below. Direct Materials $41,000 Work−in−Progress Inventory 13,000 Finished Goods Inventory 50,000 What is the ending balance in the Direct Materials​ account?

35,000

The balance sheet of Ryan and​ Peter's partnership as of December​ 31, 2024, is given below. Assets Liabilities Cash $11,000 Accounts Payable ​$15,000 Accounts Receivable 12,000 Other liabilities ​25,000 Furniture 29,000 ​Partners' Equity Equipment 40,000 ​ Ryan, Capital 30,000 Other assets ​8,000 ​ Peter, Capital 30,000 Total assets $100,000 Total liabilities and​ partners' equity $100,000 Ryan and Peter share profits in the ratio​ 3:2. They liquidate the partnership. The furniture and equipment sold at a loss of $57,000. The accounts receivable were collected in full and the other assets were written off as worthless. The cash balance remaining to pay the liabilities is​ ________.

35,000 (just add the liabilities to get this number)

The records at Smith and​ Jones, Inc. show that Job 110 is charged with $13,000 of direct materials and $12,000 of direct labor. Smith and​ Jones, Inc. allocates manufacturing overhead at 85​% of direct labor cost. What is the total cost of Job​ 110?

35,200 13,000 + 12,000 = 25,000 12,000 x .85 = 10200 10200 + 25,000 = 35,200

Venus Manufacturing uses a predetermined overhead allocation rate based on direct labor cost. At the beginning of the​ year, it estimated the manufacturing overhead rate to be 30​% of the direct labor cost. In the month of​ June, Venus completed Job 13C and its details are as​ follows: Direct materials cost $6,600 Direct labor cost $23,000 Direct labor hours 33 hours Units of product produced 210 What is the total cost incurred for Job​ 13C

36,500

From its inception through the year of​ 2023, First​ Mart, Inc. was profitable and made strong dividend payments each year including all payments to preferred shareholders. In the year​ 2024, First Mart had major losses and paid no dividends. In​ 2025, the company started making large profits​ again, and they were able to pay dividends to all shareholders—both common and preferred. There are 1,500 shares of​ cumulative, 13​% preferred stock outstanding. The preferred stock has a par value of $100. What is the total amount of dividends that should be paid to the preferred stockholders in December​ 2025?

39,000

The following information is from the December​ 31, 2024 balance sheet of Millner Corporation. Preferred​ Stock, $100 par $580,000 Paid−In Capital in Excess of Par—Preferred 45,000 Common​ Stock, $1 par 190,000 Paid−In Capital in Excess of Par—Common 590,000 Retained Earnings 161,500 Total​ Stockholders' Equity $1,566,500 What was the average issue price of the common stock​ shares? ​(Round your answer to the nearest​ cent.)

4.11

Archangel Manufacturing calculated a predetermined overhead allocation rate at the beginning of the year based on direct labor costs. The production details for the year are given​ below: Total manufacturing overhead costs estimated at the beginning of the year $140,000 Total direct labor costs estimated at the beginning of the year $350,000 Total direct labor hours estimated at the beginning of the year 10,000 direct labor hours Actual manufacturing overhead costs for the year $150,000 Actual direct labor costs for the year $370,000 Actual direct labor hours for the year 11,400 direct labor hours Calculate the manufacturing overhead allocation rate for the year based on the above data.​ (Round your final answer to two decimal​ places.)

40% Total manufacturing overhead costs estimated at the beginning of the year $140,000 DIVIDED Total direct labor costs estimated at the beginning of the year $350,000 = 40

​Ketchen, Inc. provides the following information for​ 2024: Net income $250,000 Market price per share of common stock $65 per share Dividends paid $180,000 Common stock outstanding at Jan.​ 1, 2024 150,000 shares Common stock outstanding at Dec.​ 31, 2024 220,000 shares The company has no preferred stock outstanding. Calculate the​ price/earnings ratio of common stock.​ (Round any intermediate calculations and your final answer to two decimal​ places.)

48.15%

Sunlight Design Corporation sells glass vases at a wholesale price of $4.50 per unit. The variable cost to manufacture is $2.00 per unit. The monthly fixed costs are $7,500. Its current sales are 28,000 units per month. If the company wants to increase its operating income by 20​%, how many additional units must it​ sell? (Round any intermediate calculations to two decimal places and your final answer up to the nearest whole​ unit.)

5,000 glasses

Leonardo was a professional classical guitarist until a motorcycle accident left him disabled. After long months of​ therapy, he hired an experienced luthier​ (a maker of stringed​ instruments) and started a small shop to make and sell Spanish guitars. The guitars sell for $900​, and the fixed monthly operating costs are as​ follows: Rent and utilities $800 Wages and benefits to luthier ​$2,000 Other expenses 470 ​Leonardo's accountant told him about contribution margin​ ratios, and Leonardo understood clearly that for every dollar of​ sales, ​$0.65 went to cover his fixed​ costs, and anything above that point was profit. What is the amount of revenue Leonardo should earn each month to break​ even? (Round your answer to the nearest​ dollar.)

5,031

The following information has been provided by New​ Age, Inc.: Direct Labor $25,100 Direct Materials Used 10,000 Direct Materials Purchased 16,750 Cost of Goods Manufactured 48,300 Ending Work−in−Process Inventory 11,900 Corporate​ Headquarters' Property Taxes 2,000 Manufacturing Overhead 19,800 Calculate the beginning balance of the Work−in−Process Inventory account.

5,300

Given the following​ information, determine the cost of goods sold. Direct Labor Incurred $63,000 Manufacturing Overhead Incurred 175,000 Direct Materials Used 153,000 Finished Goods​ Inventory, Jan. 1 198,000 Finished Goods​ Inventory, Dec. 31 98,500 Work−in−Process ​Inventory, Jan. 1 220,000 Work−in−Process ​Inventory, Dec. 31 110,000

600,500 Finished Goods​ Inventory, Jan. 1 198,000 - Finished Goods​ Inventory, Dec. 31 98,500 = 99500 99500 + Direct Materials Used 153000 = 252500 252500 + Direct Labor Incurred $63,000 = 315500 315500 + Manufacturing Overhead Incurred 175,000 = 490500 Work−in−Process Inventory, Jan. 1 220,000 - SUB Work−in−Process Inventory, Dec. 31 110,000 = 110000 490500 + 110000 = 600,500

​Walton, Inc. provides the following​ data: 2025 2024 Cash $48,000 ​$25,000 Accounts​ Receivable, Net 100,000 ​62,000 Merchandise Inventory 75,000 ​50,000 ​Property, Plant, and​ Equipment, Net 181,000 ​120,000 Total Assets $404,000 ​$257,000 Additional information for the year ending December​ 31, 2025: Net Credit Sales $520,000 Cost of Goods Sold 150,000 Interest Expense 23,000 Net Income 180,000 Calculate the rate of return on total assets for 2025. ​ (Round your answer to two decimal​ places.)

61.42%

​Jezebel, Inc. completed Job 12 and several other jobs in the last week. The cost details of Job 12 are shown below. Direct labor cost $720 Direct materials cost $120 Machine hours 7 hours Direct labor hours 16 hours Predetermined overhead allocation rate per machine hour $90 Number of units of finished product 23 units What is the cost per unit of finished product produced under Job​ 12? (Round your answer to the nearest​ cent.)

63.91

Clay Earth Company sells ceramic pottery at a wholesale price of $5.00 per unit. The variable cost of manufacturing is $2.25 per unit. The fixed costs are $5,400 per month. It sold 4,700 units during this month. Calculate Clay​ Earth's operating income​ (loss) for this month.

7,525

Oklahoma Corp. uses the indirect method to prepare its statement of cash flows. Refer to the following information for 2024 1. Long−Term Notes​ Payable, beginning​ balance, $84,000 2. Long−Term Notes​ Payable, ending​ balance, $75,000 3. Common​ Stock, beginning​ balance, $3,400 4. Common​ Stock, ending​ balance, $29,000 5. Retained​ Earnings, beginning​ balance, $75,000 6. Retained​ Earnings, ending​ balance, $120,000 7. Treasury​ Stock, beginning​ balance, $5,600 8. Treasury​ Stock, ending​ balance, $10,300 9. No stock was retired. 10. No treasury stock was sold. 11. During​ 2024, the company repaid $38,000 of long−term notes payable. 12. During​ 2024, the company borrowed $29,000 on new long−term notes payable. 13. Net income for the year was $49,000. 14. Assume all dividends declared during the year were paid. 15. Common Stock was issued for cash. What is the net cash provided by financing​ activities?

7,900

The highest value of total cost was $90,000 in June for Acai​ Beverages, Inc. Its lowest value of total cost was $53,000 in December. The company makes a single product. The production volume in June and December were 13,000 and 8,000 ​units, respectively. What is the variable cost per​ unit? (Round your answer to the nearest​ cent.

7.40 per unit

​August, Inc. had the following transactions in​ 2024, its first year of​ operations: • Issued 27,000 shares of common stock. The stock has a par value of $1.00 per share and was issued at $18.00 per share. • Issued 1,300 shares of $170 par value preferred stock at par. • Earned net income of $35,000. • Paid no dividends. At the end of​ 2024, what is total​ stockholders' equity?

742,000

​Valley, Inc. has 11,000 shares of preferred stock outstanding. The preferred stock has a $140 par​ value, a 5​% dividend​ rate, and is noncumulative. If Valley has sufficient funds to pay​ dividends, what is the total amount of dividends that will be paid out to preferred​ stockholders?

77,000

On January​ 1, Jackson,​ Inc.'s Work−in−Process Inventory account showed a balance of $66,900. During the​ year, materials requisitioned for use in production amounted to $70,200​, of which $66,000 represented direct materials. Factory wages for the period were $209,000 of which $186,100 were for direct labor. Manufacturing overhead is allocated on the basis of​ 60% of direct labor cost. Actual overhead was $116,170. Jobs costing $353,290 were completed during the year. The December 31 balance in Work−in−Process Inventory is​ ________.

77,370

The Quadrangle Fabrication Plant suffered a fire incident at the beginning of the​ year, which resulted in the loss of property including the accounting records. Some data for the year were​ retrieved, and extracts from it are shown​ below: Total manufacturing overhead costs estimated at the beginning of the year $101,500 Total direct labor costs estimated at the beginning of the year $186,000 Total direct labor hours estimated at the beginning of the year 3,600 direct labor hours Actual manufacturing overhead costs for the year $98,480 Actual direct labor costs for the year $150,000 Actual direct labor hours for the year 3,000 direct labor hours The​ company's manufacturing overhead allocation is based on direct labor hours. How much manufacturing overhead was allocated to production during the​ year? (Round any intermediate calculations to two decimal​ places, and your final answer to the nearest​ dollar.)

84,570 $101,500 - $186,000 = close

What does​ "2/10" mean, with respect to​ "credit terms of​ 2/10, n/30"?

A discount of 2 percent will be allowed if the invoice is paid within 10 days of the invoice date.

________ represents the right to receive cash in the future from customers for goods sold or for services performed. A) Accounts receivable B) Accounts payable C) Equity D) Expenses

Answer: A

Paid−in capital consists of​________.

A. amounts received from stockholders in exchange for stock

a. The​ long-term debt is payable in annual installments of $42,000​, with the next installment due on July 31. On that​ date, Seal−N−Ship will also pay one​ year's interest at 9%. Interest was paid on July 31 of the preceding year. Make the adjusting entry to accrue interest expense at​ year-end. b. Gross unpaid salaries for the last payroll of the fiscal year were $4,700. Assume that employee income taxes withheld are $910 and that all earnings are subject to OASDI. ​(Round amounts to the nearest​ dollar.) c. Record the associated employer taxes payable for the last payroll of the fiscal​ year, $4,700. Assume that the earnings are not subject to unemployment compensation taxes. d. On February​ 1, the company collected one​ year's rent of $7,200 in advance.

A. Interest Expense 17,325 Interest Payable 17,325 To accrue interest expense at year-end. (Accrued Interest ​($210,000 ​× 9​% ​× 11÷12)​ = $17,325) B. Salaries Expense 4,700 Salaries Payable 3,431 CREDIT FICA-OASDI Taxes Payable 291 CREDIT FICA-Medicare Taxes Payable 68 CREDIT Employee Income Taxes Payable 910 CREDIT To record salaries expense and payroll withholdings. (FICA-OASDI Taxes Payable​ = ​($4,700 ​× 6.2​%) ​= $291 ​ FICA-Medicare Taxes Payable​ = ​($4,700 ​× 1.45​%) ​= $68 Salaries Payable ​($4,700 ​- $910 ​- $291 ​- $68​) ​= $3,431) C. Payroll Tax Expense 359 FICA-OASDI Taxes Payable 291 CREDIT FICA-Medicare Taxes Payable 68 CREDIT To record employer's payroll tax expense. D. Unearned Rent Revenue 3,000 Rent Revenue 3,000 CREDIT To record rent revenue earned at year-end. (Rent Revenue ​($7,200 ​× 5÷12)​ = 3,000)

Would the following companies most likely use job order costing or process​ costing? A. A manufacturer of refrigerators would use b. A manufacturer of specialty wakeboards would use c. A manufacturer of luxury yachts would use d. A professional services firm would use e. A landscape contractor would use f. A custom home builder would use g. A cell phone manufacturer would use h. A manufacturer of frozen pizzas would use i. A manufacturer of multivitamins would use j. A manufacturer of tennis shoes would use

A. process costing. B. job order costing. C. job order costing. D. job order costing. E. job order costing. F. job order costing. G. process costing. H. process costing. I. process costing. J. process costing.

A company that uses a perpetual inventory system purchased inventory on account and later returned goods worth $900 to the vendor​ (prior to​ payment). Which of the following would be the correct journal entry to record these​ returns?

Accounts Payable 900 Merchandise Inventory

paid the amount​ due, less the return and discount.

Accounts Payable—MegoBlock 151,100 Cash 148,078 Merchandise Inventory 3,022

returned $16,700 of the merchandise to MegoBlock due to damage during shipment.

Accounts Payable—MegoBlock 16,700 Merchandise Inventory 16,700

Journalize the return on Wheeler​'s books on September​ 28, 2024​, of the​ D39-X4 Radials, which were ordered by mistake. Do not round numbers to the nearest whole dollar. ​(Record debits​ first, then credits. Select the explanation on the last line of the journal entry​ table.)

Accounts Payable—Otis Distribution 39.88 Merchandise Inventory 39.88 Returned inventory to seller (vendor).

Journalize the payment on October​ 1, 2024​, to Otis ​Distribution, Inc. Do not round numbers to the nearest whole dollar. ​(Record debits​ first, then credits. Select the explanation on the last line of the journal entry table. Round all calculations to the nearest​ cent.)

Accounts Payable—Otis Distribution 683.66 Cash 676.82 Merchandise Inventory 6.84 Paid within discount period.

Made payment to Sherry Wholesalers for goods purchased on September 3, less return and discount.

Accounts Payable—Sherry Wholesalers 4,800 Cash 4,704 Merchandise Inventory 96

Returned $400 of inventory from September 3 purchase.

Accounts Payable—Sherry Wholesalers 400 Merchandise Inventory 400

Made​ payment, less​ allowance, to Teaton Wholesalers for goods purchased on September 9.

Accounts Payable—Teaton Wholesalers 10,600 Cash 10,600

After​ negotiations, received a $400 allowance from Teaton Wholesalers.

Accounts Payable—Teaton Wholesalers 400 Merchandise Inventory 400

Green Lawns Company earned​ $500 for landscaping services rendered. The customer promised to pay at a later time. Which of the following accounts increased as a result of this​ transaction? _?_

Accounts Receivable

Sale of merchandise inventory on account. Begin by preparing the entry to journalize the sale portion of the transaction. Do not record the expense related to the sale. We will do that in the following step.

Accounts Receivable Sales Revenue To record sale on account.

A company that uses the perpetual inventory system purchased 500 pallets of industrial soap for $10,000and paid $1,000for the freight−in. The company sold the whole lot to a supermarket chain for $14,000 on account. Which of the following entries correctly records the​ sale?

Accounts Receivable 14,000 Sales Revenue Cost of Goods Sold 11,000 Merchandise Inventory

h. Sold inventory on​ account, $28,000​; cost of goods​ sold, $12,000. Begin by recording the revenue from the sales on account. Do not record the expense related to the sale in this journal entry. We will do that in the next step.

Accounts Receivable 28,000 Sales Revenue 28,000

Sold merchandise inventory to Herman ​Company, $5,800​, on account. Terms 2​/15, ​n/35. Cost of​ goods, $2,320. Begin by preparing the entry to journalize the sale portion of the transaction. Do not record the expense related to the sale. We will do that in the following step.

Accounts Receivable—Herman Company 5,684 Sales Revenue 5,684

Sold merchandise inventory to Jex ​Company, $2,900​, on account. Terms​ n/EOM. Cost of​ goods, $1,334. Begin by preparing the entry to journalize the sale portion of the transaction. Do not record the expense related to the sale. We will do that in the following step.

Accounts Receivable—Jex Company 2,900 Sales Revenue 2,900

​25: Sold merchandise inventory to Small for $1,100 on account that cost $429. Terms of 1​/10, ​n/30 was​ offered, FOB shipping point. As a courtesy to Small​, $80 of freight was added to the invoice for which cash was paid by Faucet. Begin by preparing a compound journal entry to journalize the sale and the full amount of the receivable from this transaction. Do not record the expense related to the sale. We will do that in the following step. ​(Prepare a compound journal​ entry.)

Accounts Receivable—Small 1,169 Sales Revenue 1,089 Cash 80

Requirement 4. Evaluate the ability to pay debts. Begin by selecting the appropriate measurements that should be used to measure the ability to pay debts.

Acid-test ratio Current ratio Debt ratio Debt to equity ratio Times-interest-earned ratio The current and​ acid-test ratios are fairly high. This indicates that the company can pay its liabilities. The​ company's debt to total assets​ (its debt​ ratio) is not extraordinarily​ high, which will facilitate the company making all payments for debt. The​ times-interest-earned ratio has increased from 2020 to 2024 which is favorable.

Corporate ownership is a very popular type of ownership in the United States. Which of the following is a major reason that corporate ownership is popular? A) Stockholders have limited liability for the debts of the corporation. B) Most corporations are small or medium-sized. C) The life of a corporation is limited by the death of the owner. D) A corporation is usually managed by the owners.

Answer: A

Financial statements are prepared after an entity's transactions are analyzed and recorded. Which of the following reports is one of the required financial statements? A) Statement of cash flows B) Statement of return on assets C) Statement of withdrawals D) Expense statement

Answer: A

Hamilton Lawn Service incurred $800 as repair expense and paid the repair company in cash. This will: A) decrease the Owner's capital. B) increase the assets of the business. C) increase the liabilities of the business. D) decrease the liabilities of the business.

Answer: A

If a transaction increased an asset of a business. Which of the following can be an effect of the transaction for the accounting equation to balance? A) There is an equal decrease in another asset. B) There is an equal decrease in equity. C) There is an equal decrease in a liability account. D) Both liabilities and equity decreases.

Answer: A

Lorna Smith decided to start her own CPA practice as a professional corporation, Smith CPA PC. Her corporation purchased an office building for $35,000 that her real estate agent said was worth $50,000 in the current market. The corporation records the building as a $50,000 asset because Lorna believes that is the real value of the building. Which of the following concepts or principles of accounting is being violated? A) cost principle B) economic entity assumption C) monetary unit assumption D) going concern assumption

Answer: A

The Public Company Accounting Oversight Board (PCAOB) was created by the: A) Sarbanes-Oxley Act (SOX) B) International Accounting Standards Board (IASB) C) Institute of Management Accountants (IMA) D) American Institute of Certified Public Accountants (AICPA)

Answer: A

The amount of net income is transferred from ________ to ________. A) the income statement; the statement of owner's equity B) the balance sheet; the statement of cash flow C) the balance sheet; the income statement D) the income statement; the statement of expenditures

Answer: A

The field of accounting that focuses on providing information for internal decision makers is: A) managerial accounting. B) financial accounting. C) nonmonetary accounting. D) governmental accounting.

Answer: A

The taxable income of a sole proprietorship is: A) combined with the personal income of the proprietor. B) not combined with the proprietor's personal income. C) not taxable. D) handled similarly to that of a corporation.

Answer: A

Viva Inc. produces and sells coffee beans. This month it earned $500 by selling coffee beans to Jeffery Inc. The $500 received by Viva is its: A) revenue. B) equity. C) gain. D) debt.

Answer: A

Which of the following amounts appears on both the statement of owner's equity and the balance sheet? A) ending owner's equity B) total assets C) total revenues D) net income

Answer: A

Which of the following financial statements lists the entity's assets, liabilities, and owner's equity as of a specific date? A) balance sheet B) statement of owner's equity C) income statement D) statement of cash flows

Answer: A

Which of the following financial statements reports cash receipts and cash payments during a period of time? A) statement of cash flows B) balance sheet C) cash receipts budget D) statement of owner's equity

Answer: A

Which of the following is a characteristic of a corporation? A) A corporation is owned by stockholders. B) Lenders of a corporation do not have the right to claim the corporation's assets to satisfy their obligations. C) All shares of a corporation must be held by a single individual. D) Each stockholder has the authority to commit the corporation to a binding contract through his actions.

Answer: A

Which of the following is the correct order of preparation of financial statements? A) income statement → statement of owner's equity → balance sheet → statement of cash flows B) statement of owner's equity → balance sheet → income statement → statement of cash flows C) balance sheet → statement of owner's equity → income statement → statement of cash flows D) balance sheet → income statement → statement of owner's equity → statement of cash flows

Answer: A

Which of the following organizations is responsible for the creation and governance of accounting standards in the United States? A) Financial Accounting Standards Board B) Institute of Management Accountants C) American Institute of Certified Public Accountants D) Securities and Exchange Commission

Answer: A

Which of the following organizations requires publicly owned companies to be audited by independent accountants (CPAs)? A) Securities and Exchange Commission (SEC) B) Public Company Accounting Oversight Board (PCAOB) C) Financial Accounting Standards Board (FASB) D) American Institute of Certified Public Accountants (AICPA)

Answer: A

Which of the following statements would be most useful if an analyst wants to know the profitability of a company? A) income statement B) balance sheet C) statement of owner's equity D) statement of cash flows

Answer: A

________ are professional accountants who serve the general public, not one particular company. A) Certified public accountants B) Certified management accountants C) Cost accountants D) Controllers

Answer: A

The Public Company Accounting Oversight Board is a watchdog agency that monitors the work of independent accountants who audit public companies.

Answer: TRUE

Sharon Samson starts a plumbing service called Reliable Waterworks. Transactions of Reliable Waterworks during the first year of operations are given below: A) Sharon deposited $14,000 into a new checking account for the business and recorded the capital contribution. B) Paid $2,000 cash for equipment to be used for plumbing repairs. C) Borrowed $15,000 from a local bank and deposited the money in the checking account. D) Paid $600 rent for the year. E) Purchased $900 of office supplies by cash. F) Completed a plumbing repair project for a local lawyer and received $3,500 cash. Calculate the amount of total liabilities at the end of the first year. A) $15,000 B) $14,000 C) $27,000 D) $3,500

Answer: A Explanation: A) Borrowings from bank = $15,000

Ace Inc. had the following transactions in June: Sold goods for $4,000 on account; received cash on account, $5,000; paid $800 for repair expense; paid $2,000 to a supplier that it owed from the previous month. What is the combined effect on Cash of the June transactions? A) $2,200 increase B) $2,200 decrease C) $5,000 increase D) $2,800 decrease

Answer: A Explanation: A) Cash = $5,000 - $800 - $2,000 = $2,200 increase

Scott's Camera Shop started the year with total assets of $100,000 and total liabilities of $50,000. During the year, the business earned revenues of $200,000 and incurred expenses of $60,000. Scott made no capital contributions during the year, but did make withdrawals of $75,000. Calculate the amount of increase/decrease in Scott's equity for the year. A) $65,000 increase B) $115,000 increase C) $50,000 decrease D) $75,000 increase

Answer: A Explanation: A) Equity (at the beginning of the year) = $100,000 - $50,000 = $50,000 Equity (at the end of the year) = Owner's Capital - Owner's withdrawals + Revenues - Expenses Equity (at the end of the year) = $50,000 - $75,000 + $200,000 - $60,000 = $115,000 Change in owner's equity for the year = $50,000 - $115,000 = $65,000 increase

Robinson starts a plumbing service named Crusoe Waterworks. Transactions of Crusoe Waterworks during the first year of operations are given below: A) Robinson deposited $7,000 into a new checking account for the business and recorded the capital contribution. B) Paid $4,000 cash for equipment to be used for plumbing repairs. C) Borrowed $30,000 from a local bank and deposited the money in the checking account. D) Paid $800 rent for the year. E) Purchased $900 of office supplies on account. F) Completed a plumbing repair project for a local lawyer and received $3,500 cash. Calculate the amount of total owner's equity after recording the transactions. A) $9,700 B) $3,500 C) $7,000 D) $30,000

Answer: A Explanation: A) Equity (at the end of the year) = Owner's Capital - Owner's withdrawals + Revenues - Expenses Equity $7,000 + $3,500 - $800 = $9,700

30 years ago, Star Grocer Corporation had purchased a building for its grocery store by paying $30,000. Based on inflation estimates, the amount of the building has been adjusted in the accounting records. The building is now reported at $75,000 in the financial statements of Star Grocer. Which of the following concepts or principles of accounting is being violated? A) going concern assumption B) monetary unit assumption C) economic entity assumption D) cost principle

Answer: B

A business receives a bill from one of its suppliers for services received. The business will pay the supplier next month. How does the receipt of the bill from the supplier affect the accounting equation of the business? A) Assets decrease; equity decrease. B) Liabilities increase; equity decrease. C) Assets increase; liabilities increase. D) Liabilities increase; equity increase.

Answer: B

A debt that a business owes to an outside party is called: A) an asset. B) a liability. C) stockholders' equity. D) revenue.

Answer: B

John contributes cash in exchange for capital for his business, Bubble Wraps Inc. The two accounts involved in this transaction are: A) Bubble Wraps, Capital account and the Cash account. B) the Cash account and John, Capital account. C) John, Payables account and the Capital account. D) Bubble Wraps, Capital account and John, Payables account.

Answer: B

Joshua Thomas is the owner of Nexus Inc., a manufacturer and retailer of computer hardware. Joshua recently bought a new car as a gift for his daughter. Since Joshua paid for the car from the earnings of the business, he recorded it in the books of Nexus as an asset. Which of the following concepts or principles of accounting is Joshua violating? A) monetary unit assumption B) economic entity assumption C) cost principle D) going concern assumption

Answer: B

Lush Lawns incurred $1,500 labor expense and promised to pay the labor agency within 30 days. Which of the following would decrease as a result of this transaction? A) Assets B) Owner's Capital C) Liabilities D) Revenues

Answer: B

Lush Lawns performs lawn mowing services for its customers. The payments for the current month's services are expected to be received next month. How does this transaction affect the accounting equation of Lush Lawn? A) Liabilities increase; equity decreases. B) Assets increase; equity increases. C) Assets decrease; equity decreases. D) Liabilities increase; equity increases.

Answer: B

Martin Supply Service paid $350 cash to a materials supplier that it owed from the previous month. Which of the following accounts decreases? A) Accounts Receivable B) Accounts Payable C) Owner's Capital D) Office Supplies

Answer: B

The statement of owner's equity shows the changes in Owner's capital. Which one of these statements is true? A) Decreases in Owner's equity result from additional owner investments. B) Decreases in Owner's equity result from net losses. C) Decreases in Owner's equity result from net income. D) Decreases in Owner's equity result from revenues earned.

Answer: B

Venus Inc. paid $5,000 for account payable. How does this transaction affect the accounting equation of Venus? A) Assets decrease by $5,000 and equity increases by $5,000. B) Assets decrease by $5,000 and liabilities decrease by $5,000. C) Assets increase by $5,000 and equity decreases by $5,000. D) Assets increase by $5,000 and liabilities increase by $5,000.

Answer: B

Which of the following financial statements is used to analyze the economic resources, debt, and overall financial position of a company? A) income statement B) balance sheet C) statement of cash flows D) statement of owner's equity

Answer: B

Which of the following financial statements reports expenses in decreasing order of their amounts, by stating the largest expense first? A) statement of cash flows B) income statement C) statement of owner's equity D) balance sheet

Answer: B

Which of the following is a characteristic of a limited-liability company (LLC)? A) An LLC's life is terminated at any member's choice or death. B) Each member of an LLC is liable only for his or her own actions. C) An LLC must have more than five members. D) The income of members from an LLC is not taxed.

Answer: B

Which of the following statements is true of a sole proprietorship? A) A sole proprietorship joins two or more individuals as co-owners. B) The sole proprietor is personally liable for the liabilities of the business. C) A sole proprietorship is taxed separately from the owner. D) A sole proprietorship does not terminate at the choice or death of the owner.

Answer: B

Which of the following will be categorized as an investing activity on the statement of cash flows? A) depreciation expense on production equipment for the year B) cash paid for purchase of new machinery C) cash paid for purchase of raw materials D) cash received from issue of shares

Answer: B

The net income of a business is $29,000. The beginning and ending capital balances were $34,000 and $55,000, respectively. No capital contributions were made by the owner during the year. Calculate the amount of owner's withdrawals. A) $18,000 B) $8,000 C) $5,000 D) $60,000

Answer: B Explanation: B) Equity (at the beginning of the year) = $34,000 Equity (at the end of the year) = Owner's Capital (beginning balance) - Owner's withdrawals + Revenues - Expenses $55,000 = $34,000 - Owner's withdrawals + $29,000 Owner's withdrawals = $34,000 + $29,000 - $55,000 = $8,000

According to the ________, the acquired assets should be recorded at the amount actually paid rather than at the estimated market value. A) going concern assumption B) economic entity concept C) cost principle D) monetary unit assumption

Answer: C

The economic resources of a business such as furniture, building, and land are its: A) liabilities. B) revenues. C) assets. D) withdrawals.

Answer: C

The owner's claim to the assets of the business is called: A) return on assets. B) expenses. C) equity. D) debt.

Answer: C

The return on assets is calculated by: A) subtracting net income from average total assets. B) adding net income and average total assets. C) dividing net income by average total assets. D) multiplying net income and average total assets.

Answer: C

Which of the following amounts appears on both the income statement and statement of owner's equity? A) ending capital B) total revenues C) net income D) withdrawals

Answer: C

Which of the following financial statements reports an increase or decrease in net cash during the time period covered? A) income statement B) statement of owner's equity C) statement of cash flows D) cash budget

Answer: C

Which of the following statements best defines financial statements? A) Financial statements are the information systems that record monetary and nonmonetary business transactions. B) Financial statements are the verbal statements made to business news organizations by chief financial officers. C) Financial statements are documents that report on a business in monetary terms, providing information to help people make informed business decisions. D) Financial statements are plans and forecasts for future time periods based on information from past financial periods.

Answer: C

Which of the following will be categorized as an operating activity on the statement of cash flows? A) cash received by selling old equipment B) cash paid for purchase of new machinery C) cash paid for purchase of raw materials D) cash received from issue of shares

Answer: C

Scott's Camera Shop started the year with total assets of $80,000 and total liabilities of $40,000. During the year, the business earned revenues of $120,000 and incurred expenses of $70,000. Scott made no additional capital contributions during the year, but did make withdrawals of $60,000. What is the amount of owner's equity at the end of the year? A) $70,000 B) $120,000 C) $30,000 D) $60,000

Answer: C Explanation: C) Equity (ending balance) = Owner's Capital (beginning balance) - Owner's withdrawals + Revenues - Expenses Equity = ($80,000 - $40,000) - $60,000 + $120,000 - $70,000 = $30,000

Assume MetAmbit Inc. had net income of $2,500 for the year ending December, 2014. Its beginning and ending total assets were $35,500 and $20,500, respectively. Calculate MetAmbit's return on assets (ROA). (Round your percentage answer to two decimal places.) A) 12.57% B) 5.85% C) 8.93% D) 9.50%

Answer: C Explanation: C) Return on assets (ROA) = $2,500 ÷ [($35,500 + $20,500) ÷ 2] = 8.93%

David has decided to open an auto-detailing business. He will pick up an automobile from the client, take it to his parents' garage, detail it, and return it to the client. If he does all of the work himself and takes no legal steps to form a special organization, which type of business organization, in effect, has he chosen? A) Limited-liability company B) Partnership C) Corporation D) Sole proprietorship

Answer: D

GAAP are the rules that govern accounting in the United States. The acronym GAAP in this statement refers to: A) Globally Accepted and Accurate Policies. B) Global Accommodation Accounting Principles. C) Generally Accredited Accounting Policies. D) Generally Accepted Accounting Principles.

Answer: D

Gunnie Inc., located in Texas, records business transactions in dollars and disregards changes in the value of a dollar over time. Which of the following accounting assumptions does this represent? A) economic entity assumption B) going concern assumption C) accounting period assumption D) monetary unit assumption

Answer: D

In a limited-liability company: A) the members are personally liable to pay the entity's debts. B) tax on earnings is paid by the business. C) the members are liable for each other's actions. D) the members pay tax on their share of earnings.

Answer: D

Land is purchased by a business for $100,000. The company pays for the land by a cash payment of $20,000 and promised to pay the remaining amount at a later period. What is net effect of this transaction on the business's accounting equation? A) Assets increase by $100,000; liabilities decrease by $20,000. B) Assets increase by $100,000; liabilities decrease by $80,000. C) Assets increase by $80,000; equity increases by $80,000. D) Assets increase by $80,000; liabilities increase by $80,000.

Answer: D

Land was originally purchased for $20,000. It is sold for $20,000 in cash. How does the sale affect the accounting equation? A) Assets increase by $20,000; liabilities decrease by $20,000. B) Assets increase by $20,000; liabilities increase by $20,000. C) Assets increase by $20,000; equity increases by $20,000. D) Assets increase by $20,000; assets decrease by $20,000.

Answer: D

Lush Lawns earned $1,000 for lawn mowing services rendered. The customer promised to pay at a later time. Which of the following accounts increased as a result of this transaction? A) Accounts payable B) Supplies C) Cash D) Accounts receivable

Answer: D

Martin Supply Service received $1,000 cash from a customer which was owed to the business from the previous month. Which of the following accounts would decrease as a result of this transaction? A) Cash B) Equity C) Accounts Payable D) Accounts Receivable

Answer: D

The Sarbanes-Oxley Act (SOX) made it a criminal offense to: A) transfer shares of stock. B) issue debentures. C) declare bankruptcy. D) falsify financial information.

Answer: D

The explanation of why the net income differs from the change in cash balance for the period is explained in the: A) income statement. B) balance sheet. C) statement of owner's equity. D) statement of cash flows.

Answer: D

Which of the following financial statements reports that total assets are equal to total liabilities plus total owner's equity? A) statement of owner's equity B) statement of cash flows C) income statement D) balance sheet

Answer: D

Which of the following formulae is used to calculate average total assets for the return on assets ratio? A) Average total assets = (Beginning total assets + Ending total assets) × 2 B) Average total assets = (Beginning total assets - Ending total assets) × 2 C) Average total assets = (Beginning total assets - Ending total assets) ÷ 2 D) Average total assets = (Beginning total assets + Ending total assets) ÷ 2

Answer: D

Which of the following items is included in the headings of the financial statements? A) date and time of filing tax returns B) place and time of preparation of the statement C) name of the preparer of the statement D) name of the business

Answer: D

Which of the following users would rely on management accounting information for decision-making purposes? A) potential investors B) creditors C) customers D) company managers

Answer: D

Which of the following will be categorized as a financing activity on the statement of cash flows? A) cash received by selling old equipment B) cash paid for purchase of new machinery C) cash paid for purchase of raw materials D) cash received from issue of shares

Answer: D

The equity of Autumn Company is $150,000 and the total liabilities are $90,000. Its total assets would be: A) $300,000. B) $180,000. C) $60,000. D) $240,000.

Answer: D Explanation: D) Assets = Liabilities + Equity Assets = $90,000 + $150,000 = $240,000

A creditor is a person who owes money to the business.

Answer: FALSE

A creditor is any person who has an ownership interest in a business.

Answer: FALSE

A publicly traded company in the United States does not come under SEC regulations as long as it follows the rules of GAAP.

Answer: FALSE

As per the economic entity assumption, an organization and its owner should be seen as the same entity.

Answer: FALSE

Equity decreases with expenses and revenues.

Answer: FALSE

For an accounting equation to balance, a transaction must affect both the sides of the equation.

Answer: FALSE

IFRS are comparatively more specific and more rule based than U.S. GAAP.

Answer: FALSE

In a limited-liability company (LLC), the members are personally liable for the debts of the business.

Answer: FALSE

Outside investors would ordinarily use managerial accounting information to decide whether or not to invest in a business.

Answer: FALSE

Owner's withdrawals are the expenses of a business.

Answer: FALSE

The balance sheet of a business summarizes an entity's revenues and expenses.

Answer: FALSE

The most that the owner of a sole proprietorship can lose, as a result of business debts or lawsuits, is the amount he/she has invested in the business.

Answer: FALSE

A business owner starts a new business and invests $6,000 of capital. This transaction results in an increase in the assets of the business.

Answer: TRUE

An examination of a company's financial statements and records is called an audit.

Answer: TRUE

Any person or business to whom a business owes money is called the business's creditor.

Answer: TRUE

Financial accounting focuses on information for decision makers outside of the business, such as creditors and taxing authorities.

Answer: TRUE

Financial statements are business documents that are used to communicate information needed to make business decisions.

Answer: TRUE

In a sole proprietorship, the owner is personally liable for the debts of the business.

Answer: TRUE

International Financial Reporting Standards (IFRS) are the international accounting rules that U.S. companies must follow for their international operations.

Answer: TRUE

Liabilities represent creditors' claims on the business's assets.

Answer: TRUE

Local, state, and federal governments use accounting information to calculate income tax.

Answer: TRUE

Members of a limited-liability company (LLC) are not personally liable for the debts of the business.

Answer: TRUE

Use the following information for The Glass Doctor​, a retail merchandiser of auto​ windshields, to compute the cost of goods​ sold:

Beginning Merchandise Inventory PLUS ++++++ Purchases PLUS +++++++ Freight In EQUALS ======== Cost of Goods Available for Sale :) MINUS ---------- Ending Merchandise Inventory EQUALS ========== Cost of Goods Sold

Which of the following formulas represent cost of goods sold for a merchandising​ business?

Beginning Merchandise Inventory​ + Purchases and Freight In − Ending Merchandise Inventory​ = Cost of Goods Sold

Overall:

Beginning Merchandising Inventory + Purchases and Freight In = Cost of Goods Available for Sale - Ending Merchandising Inventory = Cost of Goods Sold

Shaun and Rick are partners. Shaun has a capital balance of $9,000 and Rick has a capital balance of $7,000. Edwin contributes a building with a current market value of $5,000 to acquire an interest in the new partnership. Which of the following is TRUE of the effect of the transaction on the balance​ sheet? (Assume no bonus to any​ partner.)

Both assets and equity will increase by $5,000.

Consistency principle

Businesses should use the same accounting methods from period to period.

Weighted-average

Calculates a weighted-average cost based on the cost of goods available for sale and the number of units available.

Floyd and Merriam start a partnership business on June​ 12, 2025. Their capital account balances as of December​ 31, 2026 stood as​ follows: Floyd $31,000 Merriam 20,000 They agreed to admit Ramelow into the business for a one−third interest in the new partnership. Ramelow contributes $24,000 cash in exchange for the partnership interest. Assume that Floyd and Merriam shared profits and losses equally before the admission of Ramelow. Which of the following is the correct journal entry to record the above​ admission?

Cash 24,000 ​Merriam, Capital 500 ​Floyd, Capital 500 ​ CREID Ramelow, Capital 25,000

Requirement 3. Evaluate the ability to sell merchandise inventory. Begin by selecting the appropriate measurements that should be used to measure the ability to sell inventory and the profitablilty of each sales dollar above the cost of goods sold.

Gross profit percentage Days' sales in inventory Inventory turnover Inventory turnover has increased over the period​ examined, which is a positive sign. The company is selling inventory more rapidly.

Corporation has two classes of​ stock: common, ​$3 par​ value; and​ preferred, ​$25 par value. Requirements 1. Journalize California​'s issuance of 4,000 shares of common stock for $11 per share. 2. Journalize California​'s issuance of 4,000 shares of preferred stock for a total of $100,000. Requirement 1. Journalize California​'s issuance of 4,000 shares of common stock for $11 per share. Requirement 2. Journalize California​'s issuance of 4,000 shares of preferred stock for a total of $100,000

Cash 44,000 CREDIT Common Stock—$3 Par Value 12,000 CREDIT Paid-In Capital in Excess of Par—Common 32,000 Issued common stock at a premium. Cash 100,000 CREDIT Preferred Stock—$25 Par Value 100,000 Issued preferred stock at par.

Suppose Price Point Furniture issued 150,000 shares of ​$0.05 par common stock at $5 per share. Which journal entry correctly records the issuance of this​ stock?

Cash 750,000 Common Stock—$0.05 Par Value 7,500 Paid-In Capital in Excess of Par-Common 742,500

​Harry, Tony, and Liza run a partnership firm and share in the profits​ 1:3:2, respectively. In the process of​ liquidation, the partnership sells non−cash ​assets, having a book value of $82,000​, for $81,000. What would be the journal entry for the sale for cash of the non−cash ​assets?

Cash 81,000 Loss on Disposal 1,000 CREDIT Non−cash Assets

Rodriguez and Ying start a partnership on July​ 1, 2025. Rodriguez contributes​ $4,200 cash, furniture with a current market value of​ $45,000, accounts payable with a current market value of​ $13,000 and equipment with a current market value of​ $25,000. Which of the following is the correct journal entry to record​ Rodriguez's partnership​ investment?

Cash ​4,200 Furniture ​45,000 Equipment ​25,000 CREDIT Accounts Payable ​13,000 ​ CREDIT Rodriguez, Capital ​61,200

Requirement 2. Assume the​ non-cash assets are sold for $120,000. Journalize the liquidation transactions. ​(Record debits​ first, then credits. Select the explanation on the last line of the journal entry​ table.) Journalize the sale of the​ non-cash assets for $120,000. ----- Journalize the allocation of the gain or loss to the​ partners' capital accounts. --- Journalize the payment of the liabilities --- Journalize the distribution of remaining cash to the partners.

Cash 120,000 Loss on Disposal 15,000 Non-cash Assets 135,000 CREDIT To record the sale of non-cash assets at liquidation. --- Sully, Capital 2,250 Parkerson, Capital 11,250 Mitchell, Capital 1,500 Loss on Disposal 15,000 CREDIT To allocate the loss on liquidation of non-cash assets. --- Accounts Payable 62,000 Cash 62,000 To record the payment of outstanding liabilities. --- Mitchell, Capital 29,500 Sully, Capital 14,750 Parkerson, Capital 36,750 Cash 81,000 CREDIT To distribute remaining cash based on partners' capital balances.

Journalize the sale of the​ non-cash assets for $15,000. --- Journalize the allocation of any gain or loss on the sale of the​ non-cash assets. ---- Journalize the payment of the liabilities. --- Journalize the payment to the partners.

Cash 15,000 Loss on Disposal 7,000 Non-cash Assets 22,000 CREDIT To record the sale of Non-cash Assets at liquidation. ---- Murphy, Capital 4,200 Kent, Capital 2,800 Loss on Disposal 7,000 CREDIT To allocate loss on liquidation of Non-cash Assets. --- Accounts Payable 15,000 Cash 15,000 CREDIT To record the payment of the outstanding liabilities. --- Murphy, Capital 4,800 Kent, Capital 5,200 Cash 10,000 CREDIT To distribute remaining cash based on partners' capital balances.

The financial statements of Denison Furniture Company include the following​ items: 2025 2024 Cash $60,500 $57,000 Short−term Investments 34,000 10,000 Net Accounts Receivable 99,000 103,000 Merchandise Inventory 161,000 147,000 Total Assets 535,000 553,000 Total Current Liabilities 225,000 212,000 Long−term Note Payable 54,000 59,000 What is the 2025 cash​ ratio? (Round your answer to two decimal​ places)

Cash ratio = Cash + Cash equivalents / total current liabilities. Don't put cash equivalents as cash equivalents NO CLUE DUDE LOL

Disclosure principle

Requires that a company report enough information for outsiders to make knowledgeable decisions.

Which of the following are NOT included in a post−closing trial​ balance?

Revenues and expenses

Requirement 1. Assume the​ non-cash assets are sold for $155,000. Journalize the liquidation transactions. ​(Record debits​ first, then credits. Select the explanation on the last line of the journal entry​ table.) Journalize the sale of the​ non-cash assets for $155,000. --- Journalize the allocation of the gain or loss to the​ partners' capital accounts. --- Journalize the payment of the liabilities. --- Journalize the distribution of remaining cash to the partners.

Cash 155,000 Non-cash Assets 135,000 CREDIT Gain on Disposal 20,000 CREDIT To record the sale of non-cash assets at liquidation. --- Gain on Disposal 20,000 Sully, Capital 3,000 CREDIT Parkerson, Capital 15,000 CREDIT Mitchell, Capital 2,000 CREDIT To allocate the gain on liquidation of non-cash assets. ---- Accounts Payable 62,000 Cash 62,000 To record the payment of outstanding liabilities. --- Sully, Capital 20,000 Parkerson, Capital 63,000 Mitchell, Capital 33,000 Cash 116,000 CREDIT To distribute remaining cash based on partners' capital balances. ----

The charter of Magnolia Corporation authorizes the issuance of 900 shares of preferred stock and 3,500 shares of common stock. During a​ two-month period, Magnolia completed these​ stock-issuance transactions: Requirement 1. Record the transactions in the general journal. ​(Record debits​ first, then credits. Select the explanation on the last line of the journal entry​ table.) Mar. ​23: Issued 250 shares of ​$1 par value common stock for cash of $12 per share. ---- ​12: Received inventory with a market value of $24,000 and equipment with a market value of $18,000 for 350 shares of the ​$1 par value common stock --- ​17: Issued 900 shares of 5%​, ​$30 par value preferred stock for ​$30 per share. --- Requirement 2. Prepare the​ stockholders' equity section of the Magnolia balance sheet as of April 30​, 2024​, for the transactions given in this exercise. Retained Earnings has a balance of $74,000 at April 30​, 2024.

Cash 3,000 Common Stock—$1 Par Value 250 Paid-In Capital in Excess of Par—Common 2,750 Issued common stock for cash. ----- Inventory 24,000 Equipment 18,000 Common Stock—$1 Par Value 350 Paid-In Capital in Excess of Par—Common 41,650 Issued common stock for inventory and equipment. --- Cash 27,000 Preferred Stock—$30 Par Value 27,000 Issued preferred stock for cash. - Magnolia Corporation Balance Sheet (Partial) April 30, 2024 Stockholders' Equity Paid-In Capital: Preferred Stock—5%, $30 Par Value; 900 shares authorized, issued, and outstanding $27,000 Common Stock—$1 Par Value; 3,500 shares authorized, 600 shares issued and outstanding 600 Paid-In Capital in Excess of Par—Common 44,400 Total Paid-In Capital 72,000 Retained Earnings 74,000 Total Stockholders' Equity $146,000

Received payment from Herman Company, less discount.

Cash 5,684 Accounts Receivable—Herman Company 5,684

Requirement 1. Journalize the contributions of Demetrius and Garnett to the partnership. ​(Record debits​ first, then, credits. Select explanations on the last line of the journal entry​ table.) Journalize the contribution of Demetrius. Journalize the contribution of Garnett.

Cash 9,000 Accounts Receivable 21,000 Merchandise Inventory 43,000 Plant Assets 108,000 Accounts Payable 23,000 CREDIT Other Accrued Payables 13,000 CREDIT Notes Payable 53,000 CREDIT Demetrius, Capital 92,000 CREDIT To record Demetrius' contribution. Cash 3,000 Accounts Receivable 14,000 Merchandise Inventory 40,000 Plant Assets 58,000 Accounts Payable 12,000 CREDIT Garnett, Capital 103,000 CREDIT To record Garnett's contribution.

Carmel Company earned net income of $105,000 during the year ended December ​31, 2024. On December ​15, Carmel declared the annual cash dividend on its 6​% preferred stock​(par value, $110,000​) and a ​$0.75 per share cash dividend on its common stock (62,000 ​shares). Carmel then paid the dividends on January ​4, 2025. Requirement 1. Journalize for Carmel the entry declaring the cash dividends on December ​15, 2024. Requirement 2. Journalize for Carmel the entry paying the cash dividends on January ​4, 2025.

Cash Dividends 53,100 CREDIT Dividends Payable—Preferred 6,600 CREDIT Dividends Payable—Common 46,500 Declared a cash dividend. Dividends Payable—Preferred 6,600 Dividends Payable—Common 46,500 CREDIT Cash 53,100 Payment of cash dividend.

Requirements 1. How much are cash​ dividends? 2. What was the amount of the cash receipt from the sale of plant​ assets? a. Beginning and ending Retained Earnings are $41,000 and $67,000​, respectively. Net income for the period is $62,000. b. Beginning and ending Plant Assets are $121,500 and $129,500​, respectively. c. Beginning and ending Accumulated Depreciation—Plant Assets are $21,500 and $26,500​, respectively. d. Depreciation Expense for the period is $15,000​, and acquisitions of new plant assets total $29,000. Plant assets were sold at a $3,000 gain.

Cash dividends are $36,000 beginning balance of retained earnings + net income - ending balanceof retained earnings = dividens -------------- The cash receipt from the sale plant assets is $14,000 beginning balance plant assets + acquisition - ending balance plant assets = cost of assets sold beginning balance of accumulated depreciation + depreciation expense - ending balance accumulated depreciation = accumulated depreciation fo assets sold cost of assets sold - accumlated depreciation of assets sold = book value of assets sold book value of assets sold + gain = cash receipt from sale of plant assets

Anna and Naomi are partners. Anna has a capital balance of $48,000 and Naomi has a capital balance of $40,000. Gary invested $33,000 to acquire an ownership interest of $19,000. Which of the following is TRUE of the partnership journal entry to record the receipt of​ Gary's contribution?​ (Assume the existing partners equally divide the​ bonus.)

Cash is debited for $33,000 and​ Gary, Capital is credited for $19,000

​Hillary, Bruce, and Cindy own a partnership firm. Hillary has an ownership interest of $26,000​; Bruce has an ownership interest of $38,000​; and Cindy has an ownership interest of $29,000. In the process of​ liquidation, the partnership sells non−cash assets and registers a gain of $29,000. The profit−loss sharing agreement is​ 1/6 to​ Hillary; 2/6 to​ Bruce; and​ 3/6 to Cindy. Which of the following is TRUE when a journal entry for the allocation of gain is​ recorded?

Cindy, Capital is credited for $14,500.

Worldwide's relevant range is between sales of $253,000 and $368,000. First prepare the contribution margin income statement at the $253,000 sales level. Worldwide Travel Contribution Margin Income Statement Three Months Ended March 31, 2024 Now prepare the contribution margin income statement at the $368,000 sales level Worldwide Travel Contribution Margin Income Statement Three Months Ended March 31, 2024

Contribution margin ÷ Net sales revenue = Contribution margin ratio $180,405 ÷ $316,500 = 57 % Net Sales Revenue $253,000 Variable Costs 108,790 Contribution Margin 144,210 Fixed Costs 173,000 Operating Income (Loss) $(28,790) Net Sales Revenue $368,000 Variable Costs 158,240 Contribution Margin 209,760 Fixed Costs 173,000 Operating Income (Loss) $36,760

Which of the following formulas is the right formula for calculating contribution margin​ ratio?

Contribution margin ratio​ = Contribution margin​ / Net sales revenue

Which of the following would appear as a line item on the income statements of both a merchandiser and a​ manufacturer?

Cost of Goods Sold

Adjusted for overallocated or underallocated overhead.

Cost of Goods Sold 10,140 Manufacturing Overhead 10,140

Now journalize the expense related to the January 31 sale.

Cost of Goods Sold Merchandise Inventory To record cost of goods sold.

Now journalize the expense related to the September 15 sale—Cost of​ goods, $1,334.

Cost of Goods Sold 1,334 Merchandise Inventory 1,334

Now record the expense related to the sale.

Cost of Goods Sold 12,000 Finished Goods Inventory 12,000

Now journalize the expense related to the April 1 sale—Cost of goods sold is $18,000.

Cost of Goods Sold 18,000 Merchandise Inventory 18,000

Now journalize the expense related to the September 8 sale—Cost of​ goods, $2,320.

Cost of Goods Sold 2,320 Merchandise Inventory 2,320

Now journalize the expense related to the September25 sale—Cost of​ goods, $429.

Cost of Goods Sold 429 Merchandise Inventory 429

Use the following ratio data to complete Heirloom ​Mills' income​ statement: 1. Inventory turnover was 4.90 ​(beginning Merchandise Inventory was $890​; ending Merchandise Inventory was $850​). 2. Profit margin ratio is 15​%.

Cost of goods sold = inventory turnover x average merch inventory Net income = profit margin ration x net sales rev interest expense = net sales - COGS - selling and administive expenses - other expenses - income b4 taxes income tax expense = income b4 imcome tax - net income

The financial statements of Jim's Natural Foods include the following​ items: a. Compute the current ratio for the current year. b. Compute the cash ratio for the current year. c. Compute the​ acid-test ratio for the current year. ​ d. Compute the inventory turnover for the current year. e. Compute the​ days' sales in inventory for the current year. ​ f. Compute the​ days' sales in receivables for the current year. ​ g. Compute the gross profit percentage for the current year.

Current ratio = Total current assets / Total current liabilities Cash ratio = (Cash + Cash equivalents) / Total current liabilities Acid-test ratio= (Cash + STI + Net current receivables) / Total current liabilities Inventory turnover = Cost of goods sold / Average merchandise inventory Days' sales in inventory = 365 days / Inventory turnover Days' sales in receivables = 365 days / Accounts receivable turnover ratio Gross profit percentage = Gross profit / Net sales revenue (gross profit = net sales - cost of goods sold) photo

Completed production on jobs with costs of $36,000.

Finished Goods Inventory 36,000 Work-in-Process Inventory 36,000

Regarding gross and net​ pay, which of the following statements is​ correct?

Gross pay minus all deductions such as income tax withheld equals net pay.

At the beginning of the​ year, Tea Tree Manufacturing had the following account​ balances: Work−in−Process Inventory ​2,000 Finished Goods Inventory ​8,000 Manufacturing Overhead 0 Cost of Goods Sold 0 Sales Revenue 0 The following additional details are provided for the​ year: Direct materials placed in production $80,300 Direct labor incurred 191,000 Manufacturing overhead incurred 300,200 Manufacturing overhead allocated to production 296,600 Cost of jobs completed and transferred 501,700 The unadjusted balance in the Manufacturing Overhead account is a​ ________.

DEBIT OF 3,600

Under the perpetual inventory​ system, the journal entry to record the freight paid by the seller on goods sold​ is:

Delivery Expenses XX Cash XX

Requirement 5. Evaluate the dividends. Begin by selecting the appropriate measurements to evaluate dividends.

Dividend payout Dividends per share The dividend per share is increasing over time so the stock is attractive.

Stockholders primarily use managerial accounting information for decision-making purposes.

FALSE

The cost of goods manufactured is recorded with a debit to the Work−in−Process Inventory account and a credit to the Cost of Goods Manufactured account.

FALSE

A partnership is a business with two or more owners that is legally organized as a corporation.

False

Actual manufacturing overhead costs are credited to the Manufacturing Overhead account.

False

Gross pay is the total amount of​ salary, wages,​ commissions, and bonuses earned by an employee during a pay​ period, after taxes or any other deductions.

False

The balance sheet shows why cash increased or decreased.

False

The employee federal and state income tax and Social Security tax are optional payroll deductions.

False

The left side of the accounting equation measures the amount that the business owes to creditors plus equity. _?_

False

Working capital measures a​ business's ability to meet its long−term obligations with its current assets.

False

Requirement 2. For the profitability​ analysis, compute Ambrose​'s ​(a) gross profit percentage and​ (b) profit margin ratio. Compare these figures with the industry averages. Is Ambrose​'s profit performance better or worse than the industry​ average? ​(a) Compute Ambrose​'s gross profit percentage (b) Compute Ambrose​'s profit margin ratio. Compare these figures with the industry averages. Is Ambrose​'s profit performance better or worse than the industry​ average? Requirement 3. For the analysis of financial​ position, compute Ambrose​'s ​(a) current ratio and​ (b) debt to equity ratio. Compare these ratios with the industry averages. Assume the current ratio industry average is​ 1.47, and the debt to equity industry average is 1.83. Is Ambrose​'s financial position better or worse than the industry​ averages? (a) Compute Ambrose​'s current ratio. ​ (b) Compute Ambrose​'s debt to equity ratio. Compare these ratios with the industry averages. Assume the current ratio industry average is 1.47 and the debt to equity industry average is 1.83. Is Ambrose​'s financial position better or worse than the industry​ averages?

Gross profit percentage = Gross profit ÷ Net sales =32.4% Profit margin ratio = Net income ÷ Net sales = 10.6% When comparing the gross profit percentage and the profit margin ratio with the industry​ averages, Ambrose​'s profit performance is worse than the industry averages for both the gross profit percentage and the profit margin ratio. Current ratio = Total current assets ÷ Total current liabilities = 1.46 Debt to equity ratio = Total liabilities ÷ Total equity = 2.16 ​current ratio is close to the industry average. The debt to equity ratio is significantly worse than the industry average.

​Danby, Inc. provides the following data from its income statement for​ 2024: Net Sales $560,000 Cost of Goods Sold ​(170,000​) Gross Profit $390,000 Calculate the gross profit percentage.​ (Round your answer to two decimal​ places.)

Gross profit percentage = gross profit / net sales revenue GROSS PROFIT 390,000 / NET SALES 560,000 = .6964285714 = 69.64%

Specific identification

Identifies exactly which inventory item was sold. Usually used for higher cost inventory.

Farrell and Jimmy enter into a partnership agreement on May​ 1, 2024. Farrell contributes​ $30,000 and Jimmy contributes​ $170,000 as their capital contributions. They decide to share profits and losses in the ratio of their respective capital account balances. The net income for the year ended December​ 31, 2024 is​ $40,000. Which of the following is the correct journal entry to record the allocation of​ profit? (Do not round any intermediate calculations. Round your final answers to the nearest​ dollar.)

Income Summary ​40,000 ​Farrell, Capital ​6,000 ​Jimmy, Capital ​34,000

Journalize the entry to close the Income Summary account for the year.

Income Summary 140,000 Polacco, Capital 100,320 CREDIT Walsh, Capital 39,680 CREDIT To close Income Summary to partner's capital.

Requirement 3. Journalize the closing of the Income Summary and partner Withdrawal accounts on December​ 31, 2024. ​(Prepare compound entries. Record debits​ first, then, credits. Select the explanation on the last line of the journal entry​ table.) Begin by closing the Income Summary account on December 31.

Income Summary 79,000 Loiselle, Capital 47,400 CREDIT Randall, Capital 31,600 CREDIT To close Income Summary.

Which of the following lists the four major financial statements of a​ company?

Income​ Statement, Statement of Retained​ Earnings, Balance​ Sheet, Statement of Cash Flows

Which of the following is TRUE of a written partnership​ agreement? A

It is a legally−binding agreement between the owners which explains the procedures for liquidating the partnership. Your answer is correct. B. It is an informal agreement between the partners and is not legally binding. C. It is an agreement in which the partners hold a direct agreement with the registration​ body, and the registration body acts as an interlocutor between the partners. D. It is a legally−binding agreement between the proprietors and the stock exchange where it is listed regarding the profit sharing between the owners.

GROSS PROFIT

Sales Revenue - Cost of Goods Sold sales revenue= sale unit times unit sales price

Which of the following describes the operating activities section of the statement of cash​ flows?

It reports on activities that create revenues or expenses for the​ entity's business.

Perpetual inventory system

Keeps a running computerized record of merchandise inventory. Achieves better control over merchandise inventory. Uses bar codes to keep up-to-the-minute records of inventory. the Merchandise Inventory account is debited for purchases of goods that the company intends to resell to customers.

The inventory costing method that expenses out the newer purchases of goods is​ the:

Last-in, first-out​ (LIFO) cost method

Now journalize the closing of the partner Withdrawal accounts on December 31.

Loiselle, Capital 41,000 Randall, Capital 29,000 Loiselle, Withdrawals 41,000 CREDIT Randall, Withdrawals 29,000 CREDIT To close withdrawals.

Recorded manufacturing​ overhead: depreciation on​ plant, $12,000​; plant insurance​ (previously paid), $2,000​; plant property​ tax, $3,600 ​(credit Property Tax​ Payable).

Manufacturing Overhead 17,600 Accumulated Depreciation-Plant 12,000 Property Tax Payable 3,600 Prepaid Insurance 2,000

Purchased merchandise inventory on account. Journalize the January 16 purchase of merchandise inventory on account and the January 31 sale of merchandise inventory on account.

Merchandise Inventory Accounts Payable To purchase inventory on account.

Purchased merchandise inventory on account from Teaton Wholesalers, $11,000. Terms 1​/10, n/30, FOB destination.

Merchandise Inventory 11,000 Accounts Payable—Teaton Wholesalers 11,000

Journalize the purchase transactions. Explanations are not required. ​(Assume the company uses a perpetual inventory system. Record debits​ first, then credits. Exclude explanations from journal​ entries. purchased $167,800 worth of MegoBlock toys on account with credit terms of 2/10, n/45.

Merchandise Inventory 167,800 Accounts Payable—MegoBlock 167,800

Now prepare the entry to update the Merchandise Inventory account for the cost of the returned merchandise—Cost of goods​ returned, $2,000.

Merchandise Inventory 2,000 Estimated Returns Inventory 2,000

​3: Purchased merchandise inventory on account from Sherry Wholesalers, $5,200.Terms 2​/15, n/EOM, FOB shipping point.

Merchandise Inventory 5,200 Accounts Payable—Sherry Wholesalers 5,200

Journalize the transaction required by Wheeler Tires on September​ 23, 2024. Do not round numbers to the nearest whole dollar. Assume tires are purchased on account. ​(Record debits​ first, then credits.

Merchandise Inventory 723.54 Accounts Payable—Otis Distribution 723.54 Purchased inventory on account.

Paid freight bill of $90 on September 3 purchase.

Merchandise Inventory 90 Cash 90

Acquisition of equipment by issuance of note payable.

NIF

The net income of a company for the year was $520,000. The company has no preferred stock. Common​ stockholders' equity was $1,600,000 at the beginning of the year and $2,400,000 at the end of the year. Calculate the rate of return on common​ stockholders' equity.​ (Round your answer to two decimal​ places.)

Net income - preferred dividends / average common stockholders equity $1,600,000 + $2,400,000 = 4000000 4000000 / 2 = 2000000 AVERAGE COMMON STOCKERHOLDERS EQUITY 520,000 / 2000000 = .26 26% measure of profitability

​Amber, Inc. provides the following information for​ 2025: Net income $320,000 Market price per share of common stock $60 per share Dividends paid $185,000 Common stock outstanding at Jan.​ 1, 2025 160,000 shares Common stock outstanding at Dec.​ 31, 2025 220,000 shares The company has no preferred stock outstanding. Calculate the earnings per share for 2025.​ (Round your answer to two decimal​ places.)

Net income - preferred dividends / weighted average number of common shares outstanding Net income $320,000 + (160,000+220,000/ 2) = 1.68 $1.68 per share

Co. produces sports socks. The company has fixed costs of $80,000 and variable costs of $0.96 per package. Each package sells for $1.60. Requirements 1. Compute the contribution margin per package and the contribution margin ratio.​ (Round your answers to two decimal​ places.) 2. Find the breakeven point in units and in​ dollars, using the contribution margin approach. Requirement 1. Compute the contribution margin per package and the contribution margin ratio. Begin by selecting the labels and entering the amounts to compute the contribution margin per package.

Net sales revenue per unit (1.60) - Variable costs per unit (.96) = CM per unit (.64) CM per unit (.64) ÷ Net sales revenue per unit (1.60) = CM ratio (40%) ( Fixed costs (80,000) + Target profit (0) ) ÷ CM per unit (.64) = Required sales in units (125,000) ( Fixed costs (80,000) + Target profit (0) ) ÷ CM ratio (40%) = Required sales in dollars (200,000)

Company sells a product for $65 per unit. Variable costs are $20 per​ unit, and fixed costs are $2,200 per month. The company expects to sell 540 units in September. Calculate the contribution margin per​ unit, in​ total, and as a ratio.

Net sales revenue per unit (65) - Variable costs per unit (20) = Contribution margin per unit (45) Net sales revenue (35,100) -> 540 x 65 = 35,100 - Variable costs (10,800) -> 540 x 20 = 10,800 = Contribution margin (24,300) Contribution margin (24,300) ÷ Net sales revenue (35,100) -> 540 x 65 = 35,100 = Contribution margin ratio (69%)

Funtime Park competes with Cool World by providing a variety of rides. Funtime sells tickets at $70 per person as a​one-day entrance fee. Variable costs are $42 per​person, and fixed costs are $170,800 per month. Compute the contribution margin per unit and the number of tickets Funtime Park must sell to break even. Perform a numerical proof to show that your answer is correct. Begin by selecting the formula labels and then entering the amounts to compute the contribution margin per unit. Begin by selecting the formula labels and then entering the amounts to compute the number of tickets Funtime must sell to break even. ​ Begin by selecting the formula and then entering the amounts to compute the target profit to breakeven.

Net sales revenue per unit (70) - Variable costs per unit (42) = Contribution margin per unit (28) ( Fixed costs 170,800 + Target profit 0 ) ÷ CM per unit 28 = Required sales in units 6,100 Net sales revenue 427,000 - Variable costs. 256,200 - Fixed costs 170,800 = Target profit 0

Co. produces sports socks. The company has fixed costs of $80,000 and variable costs of $0.96 per package. Each package sells for $1.60. Requirements 1. Compute the contribution margin per package and the contribution margin ratio.​ (Round your answers to two decimal​ places.) 2. Find the breakeven point in units and in​ dollars, using the contribution margin approach.

Net sales revenue per unit - Variable costs per unit = CM per unit 1.60 - $0.96 = $0.64 CM per unit ÷ Net sales revenue per unit = CM ratio 0.64 ÷ $1.60 = 40% (Fixed costs + Target profit) ÷ CM per unit = Required sales in units ($80,000 + $0) ÷ $0.64 = 125,000 Fixed costs + Target profit) ÷ CM ratio = Required sales in dollars (80,000 + $0) ÷ 40% = $200,000

Gabby Company sells a product for $65 per unit. Variable costs are $20 per​unit, and fixed costs are $2,200 per month. The company expects to sell 540 units in September. Calculate the contribution margin per​unit, in​total, and as a ratio.

Net sales revenue per unit - Variable costs per unit = Contribution margin per unit $65 - $20 = $45 Net sales revenue - Variable costs = Contribution margin 35,100 - $10,800 = $24,300 Contribution margin ÷ Net sales revenue = Contribution margin ratio 24,300 ÷ $35,100 = 69%

Funtime Park competes with Cool World by providing a variety of rides. Funtime sells tickets at $70 per person as a​one-day entrance fee. Variable costs are $42 per​person, and fixed costs are $170,800 per month. Compute the contribution margin per unit and the number of tickets Funtime Park must sell to break even. Perform a numerical proof to show that your answer is correct.

Net sales revenue per unit - Variable costs per unit = Contribution margin per unit 70 - $42 = $28 (Fixed costs + Target profit) ÷ CM per unit = Required sales in units ($170,800 + $0) ÷ $28 = 6,100 Net sales revenue - Variable costs - Fixed costs = Target profit 427,000 - $256,200 - $170,800 = 0

Periodic inventory system

Normally used for relatively inexpensive goods.

Increase in Salaries Payable.

O+

Increase in accounts payable

O+

Loss on sale of land

O+

Loss on sale of land.

O+

Decrease in Accrued Liabilities.

O-

Decrease in accrued liabilities

O-

Gain on sale of building

O-

Increase in Prepaid Expenses.

O-

Increase in merchandise inventory

O-

From the graph given​ below, identify the sales revenue line.

OB

Oak Outdoor Furniture manufactures wood patio furniture. If the company reports the following costs for June 2024​, what is the balance in the Manufacturing Overhead account before overhead is allocated to​jobs? Assume that the labor has been​incurred, but not yet paid. Prepare journal entries for overhead costs incurred in June. What is the balance in the Manufacturing Overhead account before overhead is allocated to​ jobs? Enter the costs and calculate the balance​ ("Bal.") of the Manufacturing Overhead​ T-account. Prepare journal entries for overhead costs incurred in June. ​(Record debits​ first, then credits. Exclude explanations from any journal​ entries.) ​First, prepare an entry for the overhead costs for materials used. Next, prepare an entry for the overhead costs for labor incurred. ​Finally, prepare an entry for all other overhead costs.

ON DOCUMENT Manufacturing Overhead 18,000 Raw Materials Inventory 18,000 --- Manufacturing Overhead 45,000 Wages Payable 45,000 -- Manufacturing Overhead 5,300 Accumulated Depreciation 5,300

1. Journalize the sale of the​ non-cash assets for $15,000. 2. Journalize the allocation of any gain or loss on the sale of the​ non-cash assets. 3. Journalize the payment of the liabilities. 4. Journalize the payment to the partners.

ONE Cash 15,000 Loss on Disposal 7,000 Non-cash Assets 22,000 CREDIT To record the sale of Non-cash Assets at liquidation. (subtract the non-asset by the sale price given in the description) TWO Murphy, Capital 4,200 Kent, Capital 2,800 Loss on Disposal 7,000 CREDIT To allocate loss on liquidation of Non-cash Assets. THREE Accounts Payable 15,000 Cash 15,000 CREDIT To record the payment of the outstanding liabilities. FOUR Murphy, Capital 4,800 Kent, Capital 5,200 Cash 10,000 CREDIT To distribute remaining cash based on partners' capital balances.

Requirement 1. Journalize the admission of Thomspon as a partner on July 31 if Thomspon pays Loiselle $162,000 cash to purchase Loiselle​'s interest. Requirement 2. Journalize the admission of Thomspon as a partner on July 31 if Thomspon contributes $81,000 to the​ partnership, acquiring a​ 1/4 interest in the business. Requirement 3. Journalize the admission of Thomspon as a partner on July 31 if Thomspon contributes $81,000 to the​ partnership, acquiring a​ 1/6 interest in the business. Requirement 4. Journalize the admission of Thomspon as a partner on July 31 if Thomspon contributes $81,000 to the​ partnership, acquiring a​ 1/3 interest in the business.

ONE Loiselle, Capital 121,500 Thomspon, Capital 121,500 CREDIT To transfer Loiselle's capital to Thomspon. (Use LOISELLES CAPITAL IN THE ENTRY BC ITS LIKE A BOOK BALANCE) TWO Cash 81,000 Thomspon, Capital 81,000 CREDIT To record Thomspon's contribution. THREE Cash 81,000 Thomspon, Capital 54,000 CREDIT Hudson, Capital 5,400 CREDIT Meehan, Capital 6,750 CREDIT Loiselle, Capital 14,850 CREDIT To record Thomspon's contribution and bonus to existing partners. FOUR Cash 81,000 Hudson, Capital 5,400 Meehan, Capital 6,750 Loiselle, Capital 14,850 Thomspon, Capital 108,000 CREDIT To record Thomspon's contribution and bonus.

​Langley, Inc. is the manufacturer of lawn care equipment. The company incurs the following costs while manufacturing​ edgers: Requirement 1. Describe the difference between period costs and product costs. 2. Classify​ Langley's costs as period costs or product costs. If the costs are product​ costs, further classify them as direct​ materials, direct​ labor, or manufacturing overhead.

PERIOD COSTS are operating costs that are expensed in the accounting period in which they are incurred. PRODUCT COSTS are all costs of a product that GAAP requires companies to treat as an asset for external financial reporting. These costs are recorded as an asset​ (inventory) on the balance sheet until the asset is sold. The cost is then transferred to an expense account ​(COST OF GOODS SOLD​) on the income statement. On the income​ statement, COST OF GOODS SOLD is subtracted from SALES REVENUE to determine gross profit. The PERIOD COSTS are then subtracted to determine operating income. Handle and shaft of edger Product costs - direct materials Motor of edger Product costs - direct materials Factory labor for workers assembling edgers Product costs - direct labor Lubricant used on bearings in the edger (not traced to the product) Product costs - manufacturing overhead Glue to hold the housing together Product costs - manufacturing overhead Plant janitorial wages Product costs - manufacturing overhead Depreciation on factory equipment Product costs - manufacturing overhead Rent on plant Product costs - manufacturing overhead Sales commissions Period costs Administrative salaries Period costs Plant utilities Product costs - manufacturing overhead Shipping costs to deliver finished edgers to customers Period costs

A​ ________ is a schedule that summarizes the​ earnings, withholdings, and net pay for each employee.

Payroll register

Requirement 1. Compute the predetermined overhead allocation rate. Round to two decimal places. -- Requirement 2. Post actual and allocated manufacturing overhead to the Manufacturing Overhead​ T-account. -- Requirement 3. Prepare the journal entry to adjust for underallocated or overallocated overhead. -- Requirement 4. The predetermined overhead allocation rate usually turns out to be inaccurate. Why​ don't accountants just use the actual manufacturing overhead​ rate?

Predetermined overhead Estimated overhead cost ÷ Estimated machine hours = allocation rate 223,100 ÷ 30,000 = $7.44 per machine hour -- Manufacturing Overhead Maintenance labor 24,500 Plant supervisor's salary 49,000 Screws, nails and glue 42,000 Plant utilities 90,850 Depreciation 87,000 241,800 Manufacturing overhead allocated Bal. 51,550 -- Cost of Goods Sold 51,550 Manufacturing Overhead 51,550 Adjusted MOH for underallocated overhead. ---- The actual manufacturing overhead rate is not known until the end of the period . Managers need to make decisions throughout the period . Accountants use predetermined overhead allocation rates to give managers product cost information when they need it—today.

Sweeney has a capital balance of $24,000​; Sauer​'s balance is $25,000. Howard pays $100,000 to purchase Sauer's interest in the Sweeney ​& Sauer partnership. Sauer receives the full $100,000. Journalize the​ partnership's transaction to admit Howard to the partnership ust Sweeney accept Howard as a full​ partner? What rights does Howard have after purchasing Sauer​'s interest in the​ partnership?

Sauer, Capital 25,000 Howard, Capital 25,000 To record Howard's purchase of Sauer's partnership interest. has the right to refuse to accept Howard into the partnership. After being accepted into the partnership and purchasing the partnership interest of Sauer​, Howard has the full rights of a partner.​ However, Sweeney has to agree to this change.

Data for McNight State Bank​ follow: Evaluate the common stock of McNight State Bank as an investment.​ Specifically, use the three stock ratios to determine whether the common stock has increased or decreased in attractiveness during the past year. Round to two decimal places. Begin by selecting the formula to calculate the​ price/earnings ratio. Now, calculate the​ price/earnings ratio for 2024 and 2023. Select the formula to calculate the dividend yield. ​Now, calculate the dividend yield on common stock for 2024 and 2023. ​ Select the formula to calculate the dividend payout. Now, calculate the dividend payout for 2024 and 2023​ Determine whether the common stock has increased or decreased in attractiveness during the past year.

Price/earnings ratio = Market price per share of common stock ÷ Earnings per share. Price/earnings ratio 2024 $35.45 2023 $28.89 EXPLAINED: (Net income - preferred dividends) / weighted average number of common shares outstanding THIS NUMBER COMES FROM THE Total Stockholders' Equity at Year-End (includes 75,000 shares of common stock) = earnings per share THEN do market price per share of common stock divided by the earnings per share ---------------------- Dividend yield = Annual dividend per share ÷ Market price per share Dividend yield on common stock % 2024 1.9% 2023 2.8% EXPLAINED: Annual dividend per share ÷ Market price per share × 100 = Dividend yield ANNUAL DIVIDENED PER SHARE = COMMON DIVIDENS / COMMON SHARES OUTSTANDING NOW TAKE THAT ## AND / BY MARKET PRICE PER SHARE X 100 ---------------------- Dividend payout = Annual dividend per share ÷ Earnings per share Dividend payout % 2024 67% 2023 82% EXPLAINED: STEP 1: (net income - perferred dividens) / weighted average number of common shares outstanding = EARNINGS PER SHARE STEP 2: Dividen Common / 90,0000 shares of common stock = ANNUAL DIVIDEN PER SHARE STEP 3: ANNUAL DIVIDEN PER SHARE / EARNINGS PER SHARE = DIVIDEN PAYOUT ---------------------- The​ stock's attractiveness INCREASED during 2024​, as shown by the INCREASED in the​ price/earnings ratio. If an investor is looking at the stock for dividend​ potential, then the stock is LESS attractive than last​ year; both the dividend yield and the dividend payout DECREASED

Conservatism

Principle whose foundation is to exercise caution in reporting financial statement items.

Requirement 2. Compute the profitability analysis. Begin by selecting the appropriate measurements that should be used to complete a profitability analysis.

Profit margin ratio Rate of return on total assets Rate of return on common stockholders' equity Earnings per share of common stock The profit margin​ ratio, return on​ assets, and return on equity are increasing over the five years examined. The return on assets and the return on equity for each year are both very respectful. The earnings per share is increasing over time so the stock is attractive.

Identify the category of the statement of cash flows in which each transaction would be reported.

Purchased equipment for​ $130,000 cash. -> INVESTING Issued​ $14 par preferred stock for cash. -> FINANCING Cash received from sales to customers of​ $35,000. -> OPERATING Cash paid to​ vendors, $17,000. -> OPERATING Sold building for​ $19,000 gain for cash. -> INVESTING AND OPERATING Purchased treasury stock for​ $28,000. -> FINANCING Retired a notes payable with​ 1,250 shares of the​ company's common stock. -> NON-CASH INVESTING AND FINANCING

Back Country manufactures backpacks. Its plant records include the following​materials-related data: Journalize the entries to record the​ transactions, post to the Raw Materials Inventory​ account, and determine the ending balance in Raw Materials Inventory. Journalize the entries to record the transactions. Begin by recording the journal entry for the purchases of materials. ---------------------------------------------------------- Now record a single journal entry for the materials used. ----------------------------------------------------------- Post these transactions to the Raw Materials Inventory account and determine the ending balance in Raw Materials Inventory. Raw Materials Inventory

Raw Materials Inventory 73,200 Accounts Payable 73,200 Purchased materials, accumulated in RM. EXPLAIN: Purchases of canvas, on account 72,000 PLUS +++++ Purchases of sewing machine lubricating oil, on account 1,200 EQUALS=== 73,200 ------------------------------------------------------ Work-in-Process Inventory 59,000 Manufacturing Overhead 450 Raw Materials Inventory 59,450 Used materials, direct materials assigned to WIP, indirect materials accumulated in MOH. EXPLAINED: Canvas 59,000 Sewing machine lubricating oil 450 THEN ADD. ----------------------------------------------------- BAL. 38,000 | Purchase 73,200 | 59,450 USED BAL. 51,750 Raw Materials Inventory, beginning balance $38,000 Purchases of canvas, on account 72,000 PLUS Purchases of sewing machine lubricating oil, on account 1,200 = 73,200 Canvas 59,000 PLUS Sewing machine lubricating oil 450 EQUALS 59,450

Apr. 5​: Frank received a $4,000 sales return on damaged goods from the customer on April 1. Cost of goods damaged is $2,000. Start by preparing the entry to record the sales return and refund of cash. Do not update the Merchandise Inventory with this entry. We will do that in the following step.

Refunds Payable 4,000 Cash 4,000

On March​ 18, James Smith purchased $3,000 of furniture from Home Furnishings on account. The cost of the goods was $1,800. On March​ 20, Home Furnishings granted the customer a $800 sales allowance for goods damaged in transit. Which of the following represents the correct way to record this​ transaction?

Refunds Payable 800 Accounts Receivable 800

A merchandiser sold merchandise inventory on account. The journal entry to record a sales allowance in the books of the merchandiser​ (assume an adjusting entry had been recorded for estimated​ returns), using the perpetual inventory system would​ be:

Refunds Payable XX Accounts Receivable XX

On January​ 1, 2024​, Mackus contributes land in a partnership with Williams. Mackus purchased the land in 2019 for $275,000. A real estate appraiser now values the land at $700,000. Mackus wants $700,000 capital in the new​ partnership, but Williams objects. Williams believes that Mackus's capital contribution should be measured by the book value of his land. Williams and Mackus seek your advice.

Requirement 1. Which value of the land is appropriate for measuring Mackus​'s capital—book value or current market​ value? Mackus​'s capital contribution of land should be valued at CURRENT MARKET VALUE. LAND 700,000 MARKUS, CAPITAL 700,000 TO RECORD MACKUS'S CONTRIBUTION

BOTH Perpetual inventory system and Periodic inventory system

Requires a physical count of inventory to determine the quantities on hand.

Journalize the payoff of the​ short-term notes payable from 2023. Journalize the payment of the salaries payable from 2023. Journalize the borrowing of the​ short-term notes payable in 2024 Journalize the accrual of the salaries expense for 2024.

Short-Term Notes Payable 16,000 Cash 16,000 CREDIT To record payment of 2023 notes. Salaries Payable 4,000 Cash 4,000 CREDIT To record payment for salaries payable. Cash 16,900 Short-Term Notes Payable 16,900 CREDIT To record cash borrowed on notes payable. Salaries Expense 3,400 Salaries Payable 3,400 CREDIT To record accrued salaries.

The financing activities section of the statement of cash flows includes paying dividends and making payments on long−term liabilities.

True

Within the relevant​ range, the total fixed costs and the variable cost per unit remain the same.

True

Owner's withdrawals affect the​ business's net income or net loss and are recorded as an expense.

false

​A(n) ________ groups cost by​ behavior; costs are classified as either variable costs or fixed costs.

contribution margin income statement

Which of the following would be classified as a prime​ cost?

cost of direct materials used

​David, an employee of​ Cecil, Inc., has gross salary for March of​ $5,900. The entire amount is under the OASDI limit of​ $132,900, and thus subject to FICA. He is also subject to federal income tax at a rate of​ 30%. His year−to−date pay has already exceeded the​ $7,000 cap for FUTA and SUTA. The journal entry to record the​ employer's payroll tax expense includes a credit to FICA−OASDI Taxes Payable for​ $365.80. (Assume a FICA−OASDI Tax of​ 6.2% and FICA−Medicare Tax of​ 1.45%.)

True

Online financial databases provide data on companies which allows investors to compare the​ companies' future earnings.

false

A planning tool that expresses the relationships among​ costs, volume, and prices and their effects on profits and losses is called​ ________.

cost−volume−profit analysis

Prepaid Rent is always classified as a long−term asset.

false

​O'Malley, Inc. issued 60,000 shares of common stock in exchange for manufacturing equipment. The equipment has a fair value of $1,490,000. The stock has a par value of $0.02 per share. The journal entry to record this transaction includes a​ ________.

credit to Paid−In Capital in Excess of Par—Common for 1,488,800

Manufacturing costs flow from Work−in−Process Inventory to Cost of Goods Sold to Finished Goods Inventory.

false

What is the net result if the amount of net income for the year is less than the amount of the owner​ withdrawals?

capital decreases

A corporation has 13,000 shares of 15​%, $107 par noncumulative preferred stock outstanding and 20,000 shares of no−par common stock outstanding. At the end of the current​ year, the corporation declares a dividend of $220,000. What is the dividend per share for preferred stock and for common​ stock? ​(Round your answer to the nearest​ cent.)

The dividend per share is $16.05 to preferred stock and $0.57 to common stock. .15 x 107

Which of the following statements is true for financial​ leverage?

The higher the debt to equity​ ratio, the higher the financial leverage. DEBIT TO EQUITY RATIO = total liabilities / total equity

Noncumulative preferred stock is in arrears if the dividend has not been paid for the year.

false

The financial statements of Carrier Office Furniture Company include the following​ items: 2025 2024 Cash $42,500 $44,000 Short−term Investments 33,000 12,000 Net Accounts Receivable 99,000 97,000 Merchandise Inventory 158,000 148,000 Total Assets 531,000 546,000 Total Current Liabilities 269,000 286,000 Long−term Note Payable 54,000 57,000 What is working capital for​ 2025?

Working Capital: Current assets − Current liabilities Current assets = (cash + Short-term investments + Net accounting receivable + merch inv). Cash $42,500 Short−term Investments 33,000 Net Accounts Receivable 99,000 Merchandise Inventory 158,000 = 332500 CURRENT ASSETS Total Current Liabilities 269,000 332500 - 269,000 = 63500

Steps

Step 1: Cost of Goods Sold (59,000) + Cost of Ending Merchandise (2,000) = Cost of Goods Available for Sale. (61,000) Beginning Merchandise Inventory + Purchases and Freight In = Cost of Goods Available for Sale. Step 2: Cost of Goods Available for Sale (61,000) - Purchase and Freight In (51,000) = Beginning Merchandise Inventory (10,000) Step 3: Gross Profit (110,000) - Selling and Administrative Expenses (86,000) = Operating Income (24,000) Step 4: Gross Profit (40,000) - Operating Income (10,000) = Selling and Administrative Expenses (30,000) Step 5: Cost of Goods Sold (90,000) + Gross Profit (110,000) = Net Sales Revenue (200,000) Step 6: Gross Profit - Net Sales Revenue = Cost of Goods Sold Step 7: Cost of Goods Available for Sale. (92,000) - Cost of Ending Merchandise (2,000) = Cost of Goods Sold (90,000) Step 8: Cost of Goods Available for Sale (92,000) - Beginning Merchandise Inventory (31,000) = Purchase and Freight In (61,000)

More steps

Step 1: Direct Materials (116,000) + Direct Labor (85,000) + Manufacturing Overhead (41,000)= Total Manufacturing Costs incurred for the year (199,000) Step 2: Total Manufacturing Costs Incurred + Beginning Work in process = Cost to account for Step 3: Cost of Goods Manufactured (200,000) (207,000) + Beginning Finished Goods Inventory (21,000) (21,000) = Cost of Goods Available for Sale (221,000) (228,000) Step 4: Cost of Goods Available for Sale (221,000) (228,000) - Ending Finished Goods Inventory (27,000) (29,000) = Cost of Goods Sold (194,000) (199,000)

more steps

Steps 1: Net Sales Revenue (106,000) - Cost of Goods Sold (54,100) = Gross Profit (51,900) Gross Profit (51,900) - Selling and Administrative Expenses (8,800) = Operating Income (43,100)

Which of the following is a basic right of​ stockholders?

Stockholders may receive dividends from corporate earnings.

Stone and Smith had beginning capital balances of $18,000 and $13,000​, respectively. The two partners fail to agree on a​ profit-and-loss-sharing ratio. For the first month​ (June 2024​), the partnership has a net loss of $9,000. How much of this loss goes to Stone​? How much goes to Smith​? The partners withdrew no assets during June. What is each​ partner's capital balance at June​ 30? Prepare a​ T-account for each​ partner's capital account. Determine each​ partner's capital balance using these​ T-accounts.

Stone's loss $4,500 Smith's loss $4,500 (9000/2=4500) Stone, Capital 1 debit 18,000 jun 1 2 credit clos (loss) 4,500 3 debit total 13,500 bal smith capital 1 debit 13,000 jun 1 2 crdit clos (loss) 4,500 3 debit 8,500 bal

Requirement 1. Journalize the​ partners' initial contributions. ​(Record debits​ first, then, credits. Select the explanation on the last line of the journal entry​ table.) Begin by journalizing the contribution made by Loiselle. Now journalize the contribution made by Randall. Prepare the partnership balance sheet immediately after its formation on March ​15, 2024

Store Equipment 24,000 Merchandise Inventory 30,000 Accounts Receivable 10,400 Prepaid Expenses 2,700 Loiselle, Capital 43,100 CREDIT Accounts Payable 24,000 CREDIT To record Loiselle's contribution. Cash 43,100 Randall, Capital 43,100 To record Randall's contribution. Assets cash accounts recievable merch inv. repaid expenses store equipment total assets Liabilities accounts payable Partner's Equity Lo, capital Rand, capital total partner's equity total lib. and partner's equity

​Companies, a home improvement store​chain, reported the following summarized​figures: ​Win's has 20,000 common shares outstanding during 2024. Requirement 1. Compute Win​'s ​Companies' current ratio at May ​31, 2024 and 2023. Begin by selecting the formula to calculate Win​'s ​Companies' current ratio. Then enter the amounts and calculate the current ratio for 2024 and then 2023. Requirement 2. Did Win​'s Companies' current ratio​ improve, deteriorate, or hold steady during 2024​?

Total current assets ÷ Total current liabilities = Current ratio ASSETS / LIBAILITIES 2024 $51,700 ÷ $22,000 = 2.35 2023 $28,900 ÷ $13,000 = 2.22 TOTAL CURRENT ASSETS = CASH + SHORT-TERM INVESTMENTS + ACCOUNTS RECIEVABLE + MERCH INV. + OTHER CURRENT ASSETS ​Win's ​Companies' current ratio improved.

Jamie Baldwin works at College of Charlotte and is paid $35 per hour for a​40-hour workweek and​time-and-a-half for hours above 40. Requirement 1. Compute Baldwin​'s gross pay for working 44 hours during the first week of February. Requirement 2. Baldwin is​ single, and her income tax withholding is 15% of total pay. Baldwin​'s only payroll deductions are payroll taxes. Compute Baldwin​'s net​ (take-home) pay for the week. Assume Baldwin​'s earnings to date are less than the OASDI limit. Requirement 3. Journalize the accrual of wages expense and the payments related to the employment of Sarah Baldwin. Begin with the entry to accrue wages expense and payroll withholdings for Sarah Baldwin. Now record the entry to record the payment of wages to Sarah Baldwin.

Straight-time pay for 40 hours $1,400.00 Overtime pay for 4 hours 210.00 Gross Pay $1,610.00 Gross pay $1,610.00 Withholding deductions: Employee income tax $241.50 Employee OASDI tax 99.82 Employee Medicare tax 23.35 Total withholdings 364.67 Net (take-home) pay $1,245.33 Wages Expense 1,610.00 Employee Income Taxes Payable 241.50 FICA-OASDI Taxes Payable 99.82 FICA-Medicare Taxes Payable 23.35 Wages Payable 1,245.33 To record wages expense and payroll withholdings. Wages Payable 1,245.33 Cash 1,245.33 To record payment of wages.

Requirement 1. Compute Baldwin​'s gross pay for working 62 hours during the first week of February.

Straight-time pay for 40 hours $2,000.00 Overtime pay for 22 hours 1,650.00 Gross Pay $3,650.00

T/F: Accounting is the information system that measures business activities, processes the information into reports, and communicates the results to decision makers.

TRUE

When direct materials are received on the production​ floor, they are recorded on the job cost record.

TRUE

Requirement 1. Compute the acquisition of plant assets for White Media Corporation during 2024. The business sold no plant assets during the year. Assume the company paid cash for the acquisition of plant assets. Requirement 2. Compute the payment of a​ long-term note payable. During the​ year, the business issued a $5,400 note payable.

The acquisition of equipment is $23,000 Plant asset in 2024 - plant asset in 2023 ending balance plant assets + book value of plant assets sold - beginning balance plant assets = acquisition of plant assets ----- The payment of a long-term note payable is $6,400 notes payable in 2024 - notes payable in 2023 = -1,000 now subtract notes payable of 5,400 = -6,400

Illinois Woodworking Company is preparing its statement of cash flows using the indirect method. During the​ year, Illinois Woodworking sold equipment for $6,490 cash. The net book value of the asset was $4,550. Which of the following statements is​ true?

The cash receipt of $6,490 is shown as a positive cash flow in the investing activities section.

A corporation has 13,000 shares of 15​%, $107 par noncumulative preferred stock outstanding and 20,000 shares of no−par common stock outstanding. At the end of the current​ year, the corporation declares a dividend of $220,000. What is the dividend per share for preferred stock and for common​ stock? ​(Round your answer to the nearest​ cent.)

The dividend per share is $16.05 to preferred stock and $0.57 to common stock.

Requirement 1. Compute the inventory​ turnover, days' sales in​ inventory, and gross profit percentage for Achieve​'s Companies for 2024. Compute the inventory turnover. Compute the​ days' sales in inventory. ​ Compute the gross profit percentage. ------------ Requirement 2. Compute​ days' sales in receivables during 2024. Round intermediate calculations to three decimal places. Assume all sales were on account. ------------ Requirement 3. What do these ratios say about Achieve​'s Companies' ability to sell inventory and collect​ receivables?

The inventory turnover = Cost of goods sold ÷ Average merchandise inventory 3.44 times. The days' sales in inventory = 365 days ÷ Inventory turnover 106 days. The gross profit percentage = Gross profit ÷ Net sales revenue 51.6% EXPLAINED: GROSS PRRFIT = net sales - cost of goods sold ------- Days' sales in average receivables = 365 days ÷ Accounts receivable turnover ratio 50 days EXPLAINED: Accounts receivable turnover ratio = net credit sales / average net accounts recievables NET CREDIT SALES IS GIVEN ON INCOME STATEMENT AVERAGE NET ACCOUNTS REIVEBLE = ACCOUNTS RECEIVABLE FROM BALANCE SHEET ADD THEM THEN DIVIDE BY 2. 365 / Accounts receivable turnover ratio Achieve​'s ​Companies' have a high amount of inventory on hand and a LOW inventory turnover ratio. This could be an area to look at and compare to the prior year and industry average. They have a HIGH gross profit​percentage, which is a GOOD INDICTATOR The amount of time it takes to collect receivables seems HIGH, but this would depend on the CREDIT TERMS

Stone and Thombs are forming a​ partnership, Salem Leather​ Goods, to import merchandise from Spain. Stone is especially artistic and will travel to Spain to buy the merchandise. Thombs is a super salesman and has already lined up several department stores to sell the leather goods. What is the purpose of the partnership​ agreement? If the partnership agreement does not state the​ profit-and-loss-sharing ratios, how will profits or losses be​ shared? Stone is contributing $175,000 in cash and accounts payable of $25,000. Thombs is contributing a building that cost Thombs $65,000. The​building's current market value is $90,000. Journalize the contribution of the two partners. Begin by journalizing Stone​'s investment. Stone is contributing $175,000 in cash and accounts payable of $25,000. Journalize Thombs​' investment. Thombs is contributing a building that cost Thombs $65,000. The​ building's current market value is $90,000.

The purpose of the partnership agreement is to increase the partners' understanding of how the business is run. If the partnership agreement does not state the​ profit-and-loss-sharing ratios, the profits or losses are shared equally. cash 175,000 accounts pay 25,000 CREDIT stone, cap 150,000 CREDIT to record stone's contribution builiding 90,000 thombs, cap 90,000 CREDIT to record thombs' contribution

Financial statements all have a goal. The statement of cash flows does as well. Describe how the statement of cash flows helps investors and creditors perform each of the following​ functions: a. Predict future cash flows. b.Evaluate management decisions. c. Predict the ability to make debt payments to lenders and pay dividends to stockholders.

The statement of cash flows helps predict future cash flows by reporting PAST cash RECEIPTS and PAYMENTS, which are good predictors of future cash flows. The statement of cash flows helps evaluate management decisions by reporting on​ managers' INVESTMENTS. The statement of cash flows helps predict the ability to make debt payments to lenders and pay dividends to stockholders by reporting WHERE CASH CAME FROM AND HOW CASH WAS SPENT.

Aster Corporation recently organized. The company issued common stock to an inventor in exchange for a patent with a market value of $60,000. In​addition, Aster received cash for 6,000 shares of its $10 par preferred stock at par value and 9,500 shares of its​no-par common stock at $40 per share. Without making journal​entries, determine the total​paid-in capital created by these transactions.

The total paid-in capital created by these transactions amounts to $500,000

Data for WebEnterprises​ follows: Compute the dollar amount of change and the percentage of change in Web Enterprises' working capital each year during 2025 and 2024. What do the calculated changes​ indicate? Begin by selecting the formula to compute the working​ capital, the dollar amount of change and the percentage of change in Web Enterprises' working capital. First, calculate the amount and percentage of change in working capital in 2024. Next, calculate the amount and percentage of change in working capital in 2025. What do the calculated changes​ indicate?

Working capital = Current assets - Current liabilities Dollar amount of change = Later period amount - Earlier period amount Percentage of change = (Dollar amount of change ÷ Base period amount) × 100 ----- The amount of change in working capital is $40,000. The percentage of change in working capital is 32.0%. The amount of change in working capital is $65,000. The percentage of change in working capital is 39.4. FORE THESE FIND THE WORKING CAPITAL TOTALS AND WRITE THEM DOWN THEN SUBTRACT THEM FROM EACH OTHER :) --- Web's ​Enterprises' working capital has improved year over year from 2023 to 2025.

Dan Jones and Pat Smith are two employees of Lone​ Star, Inc. In January​ 2025, Dan's gross pay was​ $9,000, and​ Pat's gross pay was​ $16,400. All earnings are subject to FICA—OASDI Tax of​ 6.2% and FICA—Medicare Tax of​ 1.45%. Which of the following would be included in the entry to record the payroll tax expense to be paid out by Lone​ Star, Inc. for​ January?

a credit to FICA—Medicare Taxes Payable for​ $368.30

Angie Pereira and Ferro Schwartz are employees of Free​ Star, Inc. In February​ 2025, Angie's gross pay was​ $13,000, and​ Ferro's gross pay was​ $14,900. All earnings are subject to FICA—OASDI Tax of​ 6.2% and FICA—Medicare Tax of​ 1.45%. Which of the following would be included in the entry to record the salaries expense for​ February?

a credit to FICA—OASDI Taxes Payable for​ $1,729.80 13,000 + 14,900 / 6.2%

A company purchased inventory for $4,000 from a vendor on​ account, FOB shipping​ point, with terms of 2​/10​, n/30. The company paid $200 cash for freight in. The entry to record the payment of the invoice within 10 days of the invoice date by the purchaser would include​ ________. (Assume a perpetual inventory​ system.)

a debit to Accounts Payable for $4,000​, a credit to Merchandise Inventory for $80​, and a credit to Cash for $3,920

Which of the following would use a process costing system rather than a job order costing​ system?

a paint manufacturer

Granger Cards is a manufacturer of greeting cards. Classify its costs by matching the costs to the terms.

a. Artists' wages 2. Direct labor b. Wages of materials warehouse workers 4. Indirect labor c. Paper 1. Direct materials d. Depreciation on manufacturing equipment 5. Other manufacturing overhead e. Manufacturing plant manager's salary 4. Indirect labor f. Property taxes on manufacturing plant 5. Other manufacturing overhead g. Glue for envelopes 3. Indirect materials

Underallocated overhead occurs when​ ________.

allocated overhead costs are less than actual overhead costs

​Randall, an employee of​ Ramsay's, Inc., has gross salary for March of​ $4,000. The entire amount is under the OASDI limit of​ $132,900 and thus subject to FICA. He is also subject to federal income tax at a rate of​ 18%. Randall has a deduction of​ $320 for health insurance and​ $80 for United Way. Which of the following is included in the entry to record the liabilities for payroll withholding​ deductions?

credit to United Way Payable

Bob and Bill allocate​ 2/3 of their​ partnership's profits and losses to Bob and​ 1/3 to Bill. The net income of the firm is​ $20,000. The journal entry to close the Income Summary will include​ ________. (Do not round any intermediate calculations. Round the final answer to the nearest​ dollar.)

credit to​ Bob, Capital for​ $13,333

Under which of the following categories would Accounts Receivable​ appear?

current assets

Which characteristic of a corporation is a​ disadvantage?

double taxation

Jason Repair Company incurred​ $1,500 as advertising expense and promised to pay the advertising agency within 30 days. Which of the following will decrease as a result of this​ transaction?

equity

The statement of cash flows helps users​ ________.

evaluate management decisions

If inventory turnover is too​ slow, a company may be unable to sell goods or it may be understating merchandise inventory.

false

In a cost−volume−profit ​(CVP) graph, the breakeven point is where the sales revenue line intersects the fixed cost line.

false

In a​ liquidation, when selling assets at a​ gain, the Gain on Disposal of Assets account is debited.

false

In a​ partnership, the income is taxed at the partnership level as well as at the personal level of the owners.

false

Like a sole​ proprietorship's statement of​ owner's equity, the statement of​ partners' equity will show all the​ partners' capital accounts as one account.

false

Manley Corporation issued​ 2,500 shares of its​ $50 par,​ 4% preferred stock on March​ 31, 2025, at​ $80 per share. The amount credited to Paid−In Capital in Excess of Par−Preferred is​ $200,000.

false

When a new partner is admitted at a higher−than−book−value ​contribution, the existing partners will receive a bonus amount.

true

​Adam, Bill, and Charlie are partners. The profit and loss sharing rule between them is​ 1:4:4, with Bill getting the largest share and Adam receiving the smallest. The partnership incurs a net loss of​ $16,000. While closing the Income Summary​ ________. (Do not round any intermediate​ calculations.)

​Charlie, Capital will be debited for​ $7,111

The three major categories included on the statement of cash flows are​ ________.

​investing, operating, and financing activities