Question 1

Tina's Boutique has total receipts for the month of $32340 including sales taxes.If the sales tax rate is 5% what are Tina's sales for the month?

Accepted Answer

A) $30724 
B) $30800 
C) $32340 
D) It cannot be determined. 
A) $30724 
B) $30800 
C) $32340 
D) It cannot be determined.

Question 2

Jackson Tucker has a large consulting practice.New clients are required to pay one-half of the consulting fees up front.The balance is paid at the conclusion of the consultation.Dillion Paiva a new client paid $15000 on August 1 and another $15000 on completiton of the engagement on Sept 1.Use the following tabular analysis to record the receipt of $15000 on Sept 1

Accepted Answer

A) Increase Cash $15000 and decrease Unearned Revenue $15000. 
B) Increase Cash $15000 decrease Unearned Revenue $15000 and increase Service Revenue $30000. 
C) Increase Service Revenue $15000 and decrease Unearned Revenue $15000. 
D) Increase Cash $15000 decrease Unearned Revenue $15000 and increase Service Revenue $15000. 
A) Increase Cash $15000 and decrease Unearned Revenue $15000. 
B) Increase Cash $15000 decrease Unearned Revenue $15000 and increase Service Revenue $30000. 
C) Increase Service Revenue $15000 and decrease Unearned Revenue $15000. 
D) Increase Cash $15000 decrease Unearned Revenue $15000 and increase Service Revenue $15000.

Question 3

If the market rate of interest at the date of issuance of a bond is greater than the stated interest rate the bond will be issued at a premium.

Accepted Answer

A) True 
 B)False

Question 4

Leary Manufacturing Corporation purchased 5000 shares of its own previously issued $10 par common stock for $125000.As a result of this event

Accepted Answer

A) Leary's Common Stock account decreased $50000. 
B) Leary's total stockholders' equity decreased $125000. 
C) Leary's Paid-in Capital in Excess of Par Value account decreased $75000. 
D) All of these answer choices are correct. 
A) Leary's Common Stock account decreased $50000. 
B) Leary's total stockholders' equity decreased $125000. 
C) Leary's Paid-in Capital in Excess of Par Value account decreased $75000. 
D) All of these answer choices are correct.

Question 5

For accounting purposes stated value is treated the same way as par value.

Accepted Answer

A) True 
 B)False

Question 6

Two sisters operate a bed and breakfast on the coast of Maine.As customers make reservations they are required to pay cash in advance equal to one-half of the rate for their stay.How should the sisters record the cash received as reservations are made?

Accepted Answer

A) Increase Cash and Unearned Service Revenue. 
B) Increase Cash and Service Revenue. 
C) Decrease Unearned Service Revenue and increase Service Revenue. 
D) Increase Cash and Sales Revenue. 
A) Increase Cash and Unearned Service Revenue. 
B) Increase Cash and Service Revenue. 
C) Decrease Unearned Service Revenue and increase Service Revenue. 
D) Increase Cash and Sales Revenue.

Question 7

When no-par value stock does not have a stated value the entire proceeds from the issuance of the stock become legal capital.

Accepted Answer

A) True 
 B)False

Question 8

The following totals for the month of March were taken from the payroll records of Kern Company. $$\begin{array} { l r } 
\text { Salaries } & \$ 270,000 \
\text { FlCA taxes withheld } & 20,655 \
\text { Income taxes withheld } & 59,400 \
\text { Medical insurance deductions } & 3,915 \
\text { Federal unemployment taxes } & 2,160 \
\text { State unemployment taxes } & 13,500
\end{array}$$ The accrual of federal unemployment tax would include a(n)

Accepted Answer

A) increase to Federal Unemployment Taxes Payable for $2160. 
B) increase to Federal Unemployment Taxes Expense for $2160. 
C) decrease to Payroll Tax Expense for $2160. 
D) decrease to Federal Unemployment Taxes Payable for $2160. 
A) increase to Federal Unemployment Taxes Payable for $2160. 
B) increase to Federal Unemployment Taxes Expense for $2160. 
C) decrease to Payroll Tax Expense for $2160. 
D) decrease to Federal Unemployment Taxes Payable for $2160.

Question 9

The par value of common stock must always be equal to its market value on the date the stock is issued.

Accepted Answer

A) True 
 B)False

Question 10

When preferred stock is cumulative preferred dividends not declared in a given period are called dividends in arrears.

Accepted Answer

A) True 
 B)False

Question 11

Return on common stockholders' equity is computed by dividing net income by ending stockholders' equity.

Accepted Answer

A) True 
 B)False

Question 12

Interest expense on an interest-bearing note is

Accepted Answer

A) always equal to zero. 
B) accrued over the life of the note. 
C) only recorded at the time the note is issued. 
D) only recorded at maturity when the note is paid. 
A) always equal to zero. 
B) accrued over the life of the note. 
C) only recorded at the time the note is issued. 
D) only recorded at maturity when the note is paid.

Question 13

Current liabilities are due

Accepted Answer

A) but not receivable for more than one year. 
B) but not payable for more than one year. 
C) and receivable within one year. 
D) and payable within one year. 
A) but not receivable for more than one year. 
B) but not payable for more than one year. 
C) and receivable within one year. 
D) and payable within one year.

Question 14

On October 1 2021 Sunset & Vine Wine Shoppe borrows $150000 from the High Country Bank on a 3-month $150000 4% note.Use the following tabular analysis to record Sunset & Vine's adjustment on December 31 2021 before financial statements are prepared:

Accepted Answer

A) Decrease to Notes Payable and a increase to Interest Expense for $1500. 
B) Increase to Interest Expense and an increase to Interest Payable for $6000. 
C) Increase to Interest Expense and an increase to Interest Payable for $1500. 
D) Increase to Interest Expense and an increase to Accounts Payable for $1500. 
A) Decrease to Notes Payable and a increase to Interest Expense for $1500. 
B) Increase to Interest Expense and an increase to Interest Payable for $6000. 
C) Increase to Interest Expense and an increase to Interest Payable for $1500. 
D) Increase to Interest Expense and an increase to Accounts Payable for $1500.

Question 15

Keller Company issued a five-year interest-bearing note payable for $300000 on January 1 2021.Each January the company is required to pay $60000 on the note.How will this note be reported on the December 31 2022 balance sheet?

Accepted Answer

A) Long-term debt $300000 
B) Long-term debt $240000 
C) Long-term debt $180000; Long-term Debt due within one year $60000 
D) Long-term debt of $240000; Long-term Debt due within one year $60000 
A) Long-term debt $300000 
B) Long-term debt $240000 
C) Long-term debt $180000; Long-term Debt due within one year $60000 
D) Long-term debt of $240000; Long-term Debt due within one year $60000

Question 16

The board of directors of Eller and Keller Enterprises declared a cash dividend of $1.50 per share on 42000 shares of common stock on July 15 2021.The dividend is to be paid on August 15 2021 to stockholders of record on July 31 2021.Use the following tabular analysis to record the declaration of the dividend on July 15 2021:

Accepted Answer

A) Increase to Dividends Expense and Dividends Payable for $63000. 
B) Decrease to Cash and Dividends Payable for $63000. 
C) Increase to Dividends Payable and decrease to Common Stock for $42000. 
D) Increase to Cash Dividends and Dividends Payable for $63000. 
A) Increase to Dividends Expense and Dividends Payable for $63000. 
B) Decrease to Cash and Dividends Payable for $63000. 
C) Increase to Dividends Payable and decrease to Common Stock for $42000. 
D) Increase to Cash Dividends and Dividends Payable for $63000.

Question 17

The cost of treasury stock is deducted from total paid-in capital and retained earnings in determining total stockholders' equity.

Accepted Answer

A) True 
 B)False

Question 18

Denson Inc.has 10000 shares of 5% $100 par value non-cumulative preferred stock and 40000 shares of $1 par value common stock outstanding at December 31 2022.There were no dividends declared in 2021.The board of directors declares and pays a $120000 dividend in 2021.What is the amount of dividends received by the common stockholders in 2021?

Accepted Answer

A) $0. 
B) $50000. 
C) $120000. 
D) $70000. 
A) $0. 
B) $50000. 
C) $120000. 
D) $70000.

Question 19

If the market rate of interest is greater than the contractual rate of interest bonds will sell at a discount.

Accepted Answer

A) True 
 B)False

Question 20

With an interest-bearing note the amount of assets received upon issuance of the note is generally

Accepted Answer

A) equal to the note's face value. 
B) greater than the note's face value. 
C) less than the note's face value. 
D) equal to the note's maturity value. 
A) equal to the note's face value. 
B) greater than the note's face value. 
C) less than the note's face value. 
D) equal to the note's maturity value.

Tina's Boutique has total receipts for the month of $32340 including sales taxes.If the sales tax rate is 5% what are Tina's sales for the month?

If the market rate of interest at the date of issuance of a bond is greater than the stated interest rate the bond will be issued at a premium.

Leary Manufacturing Corporation purchased 5000 shares of its own previously issued $10 par common stock for $125000.As a result of this event

For accounting purposes stated value is treated the same way as par value.

Two sisters operate a bed and breakfast on the coast of Maine.As customers make reservations they are required to pay cash in advance equal to one-half of the rate for their stay.How should the sisters record the cash received as reservations are made?

When no-par value stock does not have a stated value the entire proceeds from the issuance of the stock become legal capital.

The par value of common stock must always be equal to its market value on the date the stock is issued.

When preferred stock is cumulative preferred dividends not declared in a given period are called dividends in arrears.

Return on common stockholders' equity is computed by dividing net income by ending stockholders' equity.

Interest expense on an interest-bearing note is

Current liabilities are due

On October 1 2021 Sunset & Vine Wine Shoppe borrows $150000 from the High Country Bank on a 3-month $150000 4% note.Use the following tabular analysis to record Sunset & Vine's adjustment on December 31 2021 before financial statements are prepared:

Keller Company issued a five-year interest-bearing note payable for $300000 on January 1 2021.Each January the company is required to pay $60000 on the note.How will this note be reported on the December 31 2022 balance sheet?

The cost of treasury stock is deducted from total paid-in capital and retained earnings in determining total stockholders' equity.

If the market rate of interest is greater than the contractual rate of interest bonds will sell at a discount.

With an interest-bearing note the amount of assets received upon issuance of the note is generally

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Fraud, Internal Control, and Cash

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities and Stockholders Equity

Managerial Accounting

Cost-Volume-Profit

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Planning for Capital Investments

Activity Based Costing

Cost-Volume Profit Analysis: Additional Issues

Filters

Exam 8: Financial Analysis: the Big Picture

Tina's Boutique has total receipts for the month of $32340 including sales taxes.If the sales tax rate is 5% what are Tina's sales for the month?

If the market rate of interest at the date of issuance of a bond is greater than the stated interest rate the bond will be issued at a premium.

Leary Manufacturing Corporation purchased 5000 shares of its own previously issued $10 par common stock for $125000.As a result of this event

For accounting purposes stated value is treated the same way as par value.

Two sisters operate a bed and breakfast on the coast of Maine.As customers make reservations they are required to pay cash in advance equal to one-half of the rate for their stay.How should the sisters record the cash received as reservations are made?

When no-par value stock does not have a stated value the entire proceeds from the issuance of the stock become legal capital.

The par value of common stock must always be equal to its market value on the date the stock is issued.

When preferred stock is cumulative preferred dividends not declared in a given period are called dividends in arrears.

Return on common stockholders' equity is computed by dividing net income by ending stockholders' equity.

Interest expense on an interest-bearing note is

Current liabilities are due

On October 1 2021 Sunset & Vine Wine Shoppe borrows $150000 from the High Country Bank on a 3-month $150000 4% note.Use the following tabular analysis to record Sunset & Vine's adjustment on December 31 2021 before financial statements are prepared:

Keller Company issued a five-year interest-bearing note payable for $300000 on January 1 2021.Each January the company is required to pay $60000 on the note.How will this note be reported on the December 31 2022 balance sheet?

The cost of treasury stock is deducted from total paid-in capital and retained earnings in determining total stockholders' equity.

If the market rate of interest is greater than the contractual rate of interest bonds will sell at a discount.

With an interest-bearing note the amount of assets received upon issuance of the note is generally

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Fraud, Internal Control, and Cash

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities and Stockholders Equity

Managerial Accounting

Cost-Volume-Profit

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Planning for Capital Investments

Activity Based Costing

Cost-Volume Profit Analysis: Additional Issues

Filters