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Study Resources (Accounting)

31) All of the following are characteristics of property, plant and equipment except: A) tangible. B) long-lived. C) held for investment. D) used in the business. 32) The cost of paving a parking lot should be charged to: A) a natural resource. B) land improvements. C) land. D) repairs and maintenance expense. 33) A lump-sum purchase of assets requires an.
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41) A company's accountant capitalizes a payment that should be recorded as an expense.  Which of the following is true? A) Revenue is overstated. B) Expenses are overstated. C) Assets are overstated. D) Liabilities are overstated. 42) A company's accountant capitalizes a payment that should be recorded as an expense. Which of the following is.
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  Table 8-2   The petty cash fund had the following petty cash ticket: Paper for photocopier$100 Miscellaneous expense20 Freight on inventory purchased.22 Postage expense  47 $189 32) Refer to Table 8-2. Assume that the business has established a petty cash fund in the amount of $200 and that the amount of cash in the fund at the time.
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82) Record entries for the following transactions for Riviera Company. Riviera Company maintains an allowance account. a)Sold merchandise on account to Carver Company, $2,800. b)Sold merchandise on account to Gwinett Company, $1,670. c)Write off both the Carver Company and the Gwinett Company accounts. d)Carver Company unexpectedly paid off its account in full.           83) Compute net.
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  Table 10-9 Sandu Trucking On July 1, 2013, Sandu Trucking bought a truck for $42,000 cash. It has estimated residual value of $6,000, and an estimated life of 4 years, or 300,000 kilometres. The truck drove 80,000 kilometres in 2013, 90,000 kilometres in 2014, 100,000 kilometres in 2015, and 50,000 kilometres.
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29) Martin Manufacturing held three interest-bearing notes during 2013 and 2014: Note 1 issued September 25, 2013, $6,000, 10%, 60 days Note 2 issued November 20, 2013, $12,000, 12%, 90 days Note 3 issued December 30, 2013, $4,000, 9%, 30 days Compute for each note: a) the maturity date b) the maturity value c) interest revenue to.
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27) On August 1, 2014, Rubble Station established a $350 petty cash fund. At the end of August, the petty cash fund contained: - Cash on hand$65.25 - Petty cash tickets for postage$95.50 office supplies94.50 miscellaneous items99.25 a) Prepare the journal entry to establish the petty cash fund on August 1, 2014. b) Prepare the journal entry.
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84) State the effect on net income of each of the following independent transactions. State your answer as: increase, decrease, or no effect. Transaction Effect on Net Income 1.  Prepare adjusting entry for uncollectible accounts. 2.  Write-off a customer's account. 3.  Reinstate a customer's account and collect the balance due.     85) On December 31, 2014, Rainbow.
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  Table 10-2   On January 1, 2013, Homes Realty Ltd. purchased a $45,000 vehicle to chauffeur clients to prospective homes. Homes plans on driving the vehicle for five years or 100,000 kilometres. Expected residual value is $10,000. 31) Referring to Table 10-2, the amortizable cost of the vehicle is: A) $9,000. B) $45,000. C) $35,000. D) $55,000. 32).
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  Table 9-13 Davidson Services At January 1, Davidson Services has the following balances: Date Accounts Receivable Debit Credit Balance 9,000 Dr. Date Allowance for Doubtful Accounts Debit Credit Balance 800 Cr. Date Bad Debts Expense Debit Credit Balance During the year, Davidson has $104,000 of credit sales, collections of $100,000, and write-offs of $1,400. 88) Refer to Table 9-13 to answer the following assuming that Davidson records uncollectible account.
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Objective 9-8 1) One key aspect to increased relevance of the financial statements under international financial reporting standards (IFRS) is to have more accounts reported at fair value as opposed to historical cost. 2) The balance sheet reports accounts receivable at: A) lower-of-cost-or-market. B) historical cost. C) fair value. D) market value. Match the following. A) trade receivables B).
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70) Prepare journal entries for the following independent situations. a)The allowance for doubtful accounts has a $525 debit balance prior to adjustment. An aging schedule prepared on December 31 reveals uncollectible accounts of $7,600. b)The allowance for doubtful accounts has a $500 credit balance prior to adjustment. An aging schedule prepared on.
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Objective 9-6 1) Accounts receivable may be presented on the balance sheet without the contra account, allowance for doubtful accounts. 2) Based on liquidity, which item would appear after accounts receivable in the Current Asset section of the Balance Sheet? A) inventory B) cash C) short-term investments D) Property, Plant, and Equipment 3) At January 1, Everbright.
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16) A petty cash fund, established with a $200 balance, had the following petty cash tickets as well as $34 in cash: Office supplies $42 Delivery expense 39 Miscellaneous expense 12 Postage expense 75 The entry to replenish the fund would be: A) Petty Cash 168         Cash in Bank 168 B) Office Supplies 42 Delivery Expense 39 Miscellaneous Expense 12 Postage Expense 75         Cash in Bank 168 C) Office Supplies 42 Delivery Expense 39 Miscellaneous Expense 12 Postage.
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  Table 9-8 The following information is available for Beauchemin Merchandising for the year ended December 31, 2014.  Accounts receivable Bal. Jan. 1, 2014$19, 500 Allowance for doubtful accounts,   Jan 1, 2014 1,040Cr. Sales Revenue for 2014 (30% on credit)520,000 Bad debt write-offs during 20141,690 Collections on account during 2014  159,900 73) Refer to Table 9-8. Assume.
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35) Janet Lee Music created a petty cash fund on July 1, 2014 with an imprest balance of $200. During July, Gerry Lynn, the fund custodian, signed the following petty cash tickets: Ticket #ItemAmount 1Office supplies$19.42 2Postage 9.00 3Courier charges12.00 4Sheet music77.33 5Office supplies29.14 On July 31, prior to the replenishment, the fund contained these tickets.
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11) The balance sheet of Rogers Company reports: accounts receivable (less allowance for doubtful accounts of $25,700), $695,500. Therefore Rogers Company's gross accounts receivable must be $721,200. 12) Aging-of-accounts-receivable and percent-of-accounts receivable are both considered income-statement approaches in estimating uncollectible accounts. 13) If the allowance method of accounting for doubtful receivables is.
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86) The accountant for Withers Company is trying to decide which method to use for estimating uncollectible accounts. An aging of accounts receivable revealed $14,325 in uncollectible accounts. Under the percent-of-sales method, bad-debt expense was estimated at $14,780. The balance in allowance for doubtful accounts prior to adjustment was $1,760.
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Objective 9-3 1) The direct write-off method is the preferred way to apply the accrual basis for measuring bad-debt expense since it matches revenues and expenses on the income statement. 2) The entry to write off an uncollectible account using the direct write-off method includes a debit to allowance for doubtful accounts. 3).
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  Table 9-11 Mark's Sales At the beginning of 2014, Mark's sales had the following ledger balances: Date Accounts Receivable Debit Credit Balance 24,000 Dr. Date Allowance for Doubtful Accounts Debit Credit Balance 1,000 Cr. Date Bad Debts Expense Debit Credit Balance During the year there were $450,000 of credit sales, $460,000 of collections, and $3,700 of write-offs. 60) Refer to Table 9-11. At the end of the year, Mark's adjusted.
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Objective 9-1 1) The accounts receivable account in the general ledger serves as a control account because it summarizes the total of the receivables from all customers . 2) One method of establishing internal control over receivables is to establish a bank lock box. 3) A bookkeeper should not be allowed to handle.
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9) Jennifer Black, CGA, is the controller of Arc Industries, a large manufacturing company. Company president, Mr. Allen Arc, informed Jennifer that if the company failed to report a "healthy bottom line" this year, the bank would turn down their application for a $1,000,000 loan. The company has suffered losses.
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Objective 10-2 1) Amortization is a process of asset valuation. 2) With respect to amortization, a business should match an asset's expense against the revenue the asset produces. 3) Book value is determined by subtracting the residual value from the cost of an asset. 4) Double-declining-balance amortization computes annual amortization by multiplying the asset's.
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Objective 8-6 1) Members of the three professional accounting bodies in Canada, CAs, CGAs, and CMAs, have no set standards for ethical conduct. 2) Accountants have additional incentives for ethical behavior and are expected to maintain higher standards than society in general. 3) Serious breaches of the professional code of conduct can result.
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11) A fully amortized asset always has a book value of zero. 12) For an asset that generates revenue fairly evenly over time, which is the most appropriate method of amortization? A) units-of-production method B) double declining balance method C) straight-line method D) declining-balance method 13) Which of the following expenditures would be debited to an.
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  Table 9-1 Ringo Company had the following information relating to net credit sales for 2014: Accounts receivable, Jan. 1, 2014 $18,000 Dr. Allowance for doubtful accounts,    Dec. 31, 2014, prior to adjustment 600 Cr. Net credit sales during 2014 95,000 Collections on account during 2014 87,000 Cash sales during 2014 27,000 31) Referring to Table 9-1, if uncollectible accounts are determined by the.
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79) Compute the ending balance in the allowance for doubtful accounts after the adjusting entries have been prepared for the following independent situations. a)Credit balance in allowance for doubtful accounts is $500 before adjustment. An aging schedule indicates $3,500 of accounts receivables are uncollectible. b) Debit balance in allowance for doubtful accounts.
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  Table 9-9 The following information is available for Martin Services for the year for the year ended December 31, 2014.  Accounts receivable Bal. Jan. 1, 2014$20, 500 Allowance for doubtful accounts,   Jan 1, 2014 1,000Cr. Sales Revenue for 2014 (40% on credit)600,000 Bad debt write-offs during 20141,500 Bad debt recoveries during 2014600 Collections on account during.
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11) The acid-test ratio would include in the denominator: A) total liabilities. B) long-term liabilities. C) total current liabilities. D) total current assets. 12) A company has the following account balances. What is the acid-test ratio? (Please round to two decimal places.) Cash $50,000 Short-term investments 85,000 Net current receivables 120,000 Inventory 145,000 Total current liabilities 275,000 A) .93 B) 1.45 C) .64 D) 1.76 13) The accountant at Wilton.
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Objective 9-7 1) Days' sales in receivables is computed as average net accounts receivables divided by 365 days. 2) The acid-test ratio tells whether the entity could pay all its current liabilities if they came due immediately. 3) A business with days' sales in receivables of 39 days is more liquid than one.
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42) Lester Company uses the allowance method and estimates its bad-debt expense based on aging the receivables. Before the adjusting entry, the allowance for doubtful accounts had a $425 debit balance. Based on aged receivables, Lester estimates that $3,700 will probably prove uncollectible. What is the amount of the adjusting.
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  Match the following. A) direct write-off method 11) A method of accounting for uncollectible accounts by which the company waits until the credit department decides that a customer's account is uncollectible, and then writes it off directly to bad-debt expense              12) A method of accounting for uncollectible receivables that is not.
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21) Which of the following assets is never amortized? A) land B) land improvements C) patents D) goodwill 22) All amounts paid to acquire an asset and to get it ready for its intended use are referred to as: A) equity expenditures. B) salvage expenditures. C) the cost of an asset. D) revenue expenditures. 23) The cost of land would.
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93) Santagos Industries gathered the following information from its accounting records for the year ended December 31, 2013, prior to adjustment: Net credit sales for the year$730,000 Accounts receivable balance, Dec. 31, 2013145,000 Allowance for doubtful accounts balance, Dec. 31, 20131,850Cr. Santagos uses the allowance method of accounting for uncollectible accounts and estimates bad-debt expense.
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11) Which of the following is included in the category Other receivables? A) Loans to employees B) Accounts receivables C) Notes receivables D) Investments 12) A record that contains the details by customer or vendor of the individual account balances would be called a: A) control account. B) subsidiary ledger. C) journal. D) liability account. Match the following. A) creditor B) receivable C).
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52) Accounts receivable has a debit balance of $5,000, and the allowance for doubtful accounts has a credit balance of $440. A specific account of $160 is written off. What is the amount of net receivables after the write-off? A) $4,720 B) $4,400 C) $4,560 D) $5,000 53) Sports Shop reports net accounts receivables on.
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  Table 9-13 Davidson Services At January 1, Davidson Services has the following balances: Date Accounts Receivable Debit Credit Balance 9,000 Dr. Date Allowance for Doubtful Accounts Debit Credit Balance 800 Cr. Date Bad Debts Expense Debit Credit Balance During the year, Davidson has $104,000 of credit sales, collections of $100,000, and write-offs of $1,400. 90) Refer to Table 9-13 to answer the following assuming that Davidson records uncollectible account.
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  Table 10-7   On January 1, 2013, Brazeau Transport purchased a $165,000 truck for hauling cattle across the border. Brazeau plans on driving the truck for four years or 450,000 kilometres. Expected residual value for the truck is $35,000.  On June 30, 2016, after having driven the truck 44,000 kilometres, the truck.
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  Table 10-1   On January 1, 2013, Bark Manufacturing Company Ltd. purchased a machine for $27,500, and expects to use the machine a total of 32,000 hours over the next four years. Bark set the residual value on the machine at $3,500. Bark used the machine 6,000 hours in 2013 and 7,200.
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6) Electronic Data Interchange is a method of streamlining payments that avoids approval for single transactions. 7) The entry to reimburse the petty cash fund includes a: A) credit to Petty Cash. B) debit to Cash in Bank. C) debit to various expenses and assets. D) debit to Petty Cash. 8) All of the following are.
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