tara westmont, the proprietor of tiptoe shoes net income

On August 11, it returned $1,500 worth of merchandise. Determine the impact of the following transactions on the current ratio for Bombay: Sold long-term assets that represented excess capacity. Garza Company had sales of $135,000, sales discounts of $2,000, and sales returns of $3,200. C. Current ratio does not affect a creditor's decision on whether to allow a company to buy on credit. When the bond is issued, the market rate of interest is 10 percent. \hline \text { Phone Service } & 655.92 \\ $100,000 1. (Supplement) Irish Industries purchased a machine for $65,000 and is depreciating it with the straight-line method over a life of 10 years, using a residual value of $3,000. \hline \text { Total } & \$ \\ The financial statements are not affected. Net operating income, $40,000 Zephyr, Capital $114,000 = $233,600 from the business during the current year. 1. E) none of the above. B. The account Purchases is not used as inventory is acquired. A. The bonds were issued at a premium. Question Tara Westmount, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103, 700, and withdrew SI8,000 from the business during the current year. D. $144,400. A. Requires a debit memorandum to recognize the customer's return. c. $390,000 Physical counts are not needed since records are maintained on a transaction-by-transaction basis. Beginning inventory $100,000 Cash receipts from customers exceeded cash payments to suppliers. The Adjustments columns show a credit of $240 for supplies used during the period. (2089/9421)*365 = 80.9 days. B. 4.15 Tara Westmont, the stockholder of Tiptoe Shoes, Inc., had annual revenues of $189,000, expenses of $105,700, and the company paid $19,600 cash in dividends to the owner (sole stockholder).. B. Which is the better deal, and why? Cash dividends paid to stockholders reduce net income. This dividend should be distributed as follows: On July 7, it returned $200 worth of merchandise. Management wishes to record the land at the market value of the stock. Decreases the Bonds Payable account. B. Interest is paid annually. C. 4.04 No expense will be recognized until the bill is paid in January Which of the following describes the correct action to be taken when preparing your bank reconciliation? 120. $$, c. A debit to a prepaid expense and a credit to Cash for $7,500. D. its expenses exceeded its revenues for an accounting period. A. D. Current ratio helps to assess a company's ability to pay its debts in the near future. Cr. $450,000 D. Both total assets and equity are unchanged and liabilities increase. $3,625 D. $22.2 billion Total assets remain the same and stockholders' equity remains the same. B. 1.6105 What was their average monthly housing cost for last year? Annual interest expense for a single bond issue continues to increase over the life of the bonds. Cash balance per company books on January 30 $2,920 (Refer to footnote 4 in the chapter.). $1,200. 1. Loss of $500 Outstanding checks at month-end B. C. B) $30,893 3.99 The machine is estimated to have a salvage value of $10,000 and an estimated useful life of 4 years. $250 A. Total assets increase and stockholders' equity increases. Sales discounts with terms 2/10, n/30 mean: A company is facing a class-action lawsuit in the upcoming year. $2,000 6.1051 Which of the following general journal entries will VC Consulting make to record this transaction? B. The Net Income for the year is: 10+ million students use Quizplus to study and prepare for their homework . Shares issued, shares outstanding, shares authorized. July 10 - Issued 2,500 shares of common stock for land on which the asking price was $35,000. A credit to gain on sale for $8,000. B) decreases the face value of the bonds. Date of record. They are paid on Monday for the five-day workweek ending on the previous Friday. The Bond Discount on the January 1, 2005, issue date was (rounded to the nearest whole dollar) The owner's capital account before closing had a balance of $303,000. E. D. an expense. The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is: Assets are often classified into current assets, long-term investments, plant assets and intangible assets. A. Which of the following is true? What would be the effect on December's income statement of a utility bill received on December 27, 2009 but which will not be paid until January 10, 2010? 1. If the sales price of the used machine was $7,500, the resulting gain or loss upon the sale was which of the following amounts? The present value of an annuity of $10,000 per year for 10 years discounted at 8 percent is what amount? Which of the following describes the effect of the inventory error on the 2014 financial statements? A. Only Job M1 was completed in May. C. B. net income to be overstated and assets to be understated. closing revenue and expense accounts at the end of the accounting period serves to make the revenue and expense accounts ready for use in the next period. The owner's capital account before closing had a balance of $297,000. Depletion is: C. Both stock and cash dividends reduce retained earnings. $0.34. The net income for the year is: A. D. Retained Earnings. C. 210 McCarthy Company has inventory of 8 units at a cost of $200 each on October 1. Which of the following will Fred need to calculate how much he must save each December 31? $$ 1. $544. Debit Retained Earnings $250,000; credit Stock Split Payable $250,000. This transaction will not impact cash flow. The company signed a note payable with interest at 6 percent per year. Cost of goods sold to be understated and net income to be understated. $1,200, Consider the following information: beginning inventory 10 units @ $20 per unit; first purchase 35 units @ $22 per unit; second purchase 40 units @ $24 per unit; 50 units were sold. Credit (Revenues) $189,000, Accounting Week 4 (Adjusting and Closing Proc, Accounting: Chapter 5: Adjustments ad the wor, Claudia Bienias Gilbertson, Debra Gentene, Mark W Lehman, Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield. D. $ -0-. B. increase total assets. Gross sales total $300,000, one-half of which were credit sales. On January 1, 2007, the ledger of Global Corporation correctly showed supplies inventory of $1,000. E. Depreciation Expense. On July 12, it paid the full amount due. the net income for the year is: 1 See answer Advertisement AlanDoris he inventory costing method selected by a company will affect The carrying value (net liability) of the bonds will equal the market price \text{R. Siglo, Capital} && 128,730\\ What is cost of goods sold using the FIFO method of inventory costing? B. Debit Retained Earnings $750,000; credit Common Stock Split Distributable $750,000. The May 31 Accounts Receivable balance was $13,000. Preferred shareholders have a preference with respect to assets in the event of liquidation. These results imply that: D. $6,750. Gracey's also has $600,000 of common stock outstanding. . A. \textbf{Siglo Delivery Service}\\ 180. $117,000. When a stock dividend (on par value stock) is declared and issued The selling price of the bonds was $5,679,575. Total assets decrease and total liabilities increase. 1 and 3 A. $62,090 When the bond was issued the market rate of interest was 10 percent. The owner's capital account before closing had a balance of $307,000. The journal entry to record the declaration of the cash dividend is: On that date, when the market price of the stock is $15 per share, the corporation issues a 2-for-1 stock split. B. Double-declining-balance depreciation is used. $100,000 Gross accounts receivable in the asset section of the balance sheet and the allowance for doubtful accounts in the expense section of the income statement. Acquired new inventory; supplier was not willing to provide normal credit terms, so an 18-month interest-bearing note was signed. Callable preferred stock. Roberts Company uses the straight-line amortization method. It was determined that the replacement cost is $18 per unit. $1,200 debit. C. c. The collective-action problem. Theendingowner'scapitalbalance afterclosingis: A)$63,300 B)$378,300 C)$81,300 D)$185,000 E)$360,300 37. A. D. Additions and improvements are considered capital expenditures. In its last financial statement prior to bankruptcy, Bombay reported current assets of $161,604,000 and current liabilities of$113,909,000. Which of the following accounts is a permanent account? B. 1. E. Jan 20 160 units were purchased at $11 per unit The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is: Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. C. Cumulative does not receive dividends but noncumulative does. $10,200 C. $21,500 Which order best describes the largest number of shares to the smallest number of shares? What is the correct closing entry for the expense accounts? 1. The F. Mercury, Capital account has a credit balance of $37,000 before closing entries are made. a. Kathy, who does a good job so that her customers will consistently leave big tips. A. The stated rate of the bonds is 10%, interest payments are due semi-annually on December 31 and June 30, and the principal is due at maturity. $28,000. A few hundred U.S. sugar makers lobby the U.S. government each year to make sure that the government taxes imported sugar at a high rate. Which of the following best describes the objective of depreciation? B. The anticipated interest rate and the future value of $1 table. On March 8, it sold 22 units for $54 each. Presenting accounting receivable at estimated net realizable value. B. its assets decreased during an accounting period. $8,000 B. debit Unearned Fees, $516; credit Fees Earned, $516. A. A. 1. $3,100. C. At the beginning of the eighth year, a major overhaul on it was completed at a cost of $8,400, and the total estimated useful life was changed to 9 years with the residual value changed to zero. No entry is made for this transaction. In the first year, 15,000 bolts were produced. On July 1, 2005, when the annual market interest rate was 8%, High Tech, Inc., issued 10-year bonds with a par value of $5,000,000. B. decrease assets, $100,000; decrease stockholders' equity, $3,000; and decrease liabilities, $103,000. Therefore, total stockholders' equity at December 31, 2010, was During 2010, Sensa Corporation incurred operating expenses amounting to $100,000 of which $75,000 was paid in cash; the balance will be paid in January 2011. 3. $8,000 D. A bond with a maturity value of $100,000 has a stated interest rate of 8 percent. C. debit Unearned Fees, $1,161; credit Fees Earned, $1,161. $770,000 Market value of the stock was$12. B. B. E. Debit Common Dividend Payable $12,000; credit Retained Earnings $12,000. Credit card discounts The adjusting entry for the year ended December 31 would include: 1. $520 An NSF check returned on a customer account When a company using the allowance method writes off a specific customer's $100,000 account receivable from the accounting system, which of the following statements are true? $5,270. a. Debit Merchandise Inventory $1,600; credit Cash $1,600. \hline What is the adjusting entry that should be recorded by Griffith Publishing Company on December 31 of the second year? $180 An entry was journalized and posted as a debit to cash for $500 and credit to accounts receivable for $5,000. What is the vehicle's book value as of December 31, 2015, assuming Wasson uses the straight-line depreciation method? A. D. $200 of prepaid insurance. The company's depreciation expense for 2014 was $15,000 on the building. Intangible assets with indefinite lives B. Rent expense appears on which of the following statements? a. Debit Warranty Expense $7,400; credit Sales $7,400. It is a contra-asset account. E. An error in the financial statements. $400,000 Zephyr, Withdrawals 43,000, Net Income $119,600+ Total assets increase and stockholders' equity decreases. E. All the statements above are correct. C. $104,000. B. B. $380 \text{R. Siglo, Withdrawals} & 30,000\\ $2,000. b. Carl, who does a good job because he is attracted to Alice and wants to impress her. Net income will be overstated, but there would be no effect on total assets. 0.50. Its acid-test ratio equals: The Adjustments columns contain entries for the following: K. Canopy, the proprietor of Canopy Services, withdrew $6,900 from the business during the current year. All of the above are steps toward effective internal control. E) None of the above is correct. The bonds were sold at a discount. b. Which of the following about earnings per share is true? A. B. i and iii D. 220, 1. 2003-2023 Chegg Inc. All rights reserved. The 2007 income statement should report supplies expense amounting to Current assets multiplied by current liabilities. B) stated rate of interest is greater than the market rate of interest. A. D. 3.91. $1,180 \text{Direct manufacturing labor} & \text{275.000} & \text{209.000}\\ Which of the following is false regarding a perpetual inventory system? Recording cash received in advance from customers as revenue when the product is not yet shipped $5,335 $1,000 credited to an expense account and debited to a liability account. A. The issue price was $9,668 based on an 8% effective interest rate. Purchase allowances refer to a price reduction (allowance) granted to a buyer of defective or unacceptable merchandise. A. not change total assets. B. Preferred stock, 7%, $50 par value, 1,000 shares issued and outstanding with dividends in arrears for 2008 and 2009. A. $2,920. B. B. $188,000 B. B. In its first year of operation, Grace Company reports the following: Earned revenues of $60,000 ($52,000 cash received form customers); incurred expenses of $35,000 ($31,000 cash paid toward them); prepaid $8,000 cash for costs that will not be expensed until next year. D. If earnings per share equals $5.00, then the maximum dividend payment would be $5.00. a. Carp Corporation has provided the following information for its most recent month of operation: sales $16,000; ending inventory $4,000, purchases $8,000 and gross profit $10,000. D. $50,000. A. $174,000 Tara Westmont, the owner of Tiptoe Shoes, had annual revenues of $189,000, expenses of $105,700, and withdrew $19,600 from the business during the current year. $2,000,000 in the Long-Term Liability section. C) $82,300 e. $520, On December 31, there were 26 units remaining in ending inventory. 1. 1.60 $1,180 C. The debit to cash will be less than the credit to accounts receivable on May 19. Transaction analysis of operating expenses for 2010 should reflect only the following: C. a. The ending owner's capital balance after closing is: 1 See answer Advertisement andromache Answer: Debit Merchandise Inventory $200; credit Sales Returns $200. A. B. $5,000. What is the total amount of the dividend? \text{Accounts Payable} && 9,396\\ Par value and the market rate on the date the bond was issued. 1. What is cost of goods sold using the LIFO method of inventory costing? C. its liabilities increased during an accounting period. A. D. $8,800 Debit Prepaid Subscriptions $11,250, credit Sales $11,250. What amount would be recorded as bad debt expense for the current period? Stockholders maintain proportionate ownership percentages. E) None of the above. d. $343 An increase in an asset and a decrease in another asset. A company has been successful in reducing the amount of sales returns and allowances. 1. B. A. d. $11,500. C. decrease stockholders' equity, $100,000; decrease liabilities, $3,000; and decrease assets, $103,000. Sales discounts with terms 2/10, n/30 mean: On July 7, it returned $200 worth of merchandise. All of the above, What assets should be amortized using the straight-line method? 1. A. For beginning stockholders equity, use the balance after 1. As of March 1, outstanding checks total $22,000 and deposits in transit total $15,000. The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is. The Roscoe Company's March 1, 2010 bank statement balance was $70,000. A. $100,000 B. The journal entry to record the issuance is: Interest expense reduces taxable income. A company's board of directors votes to declare a cash dividend of $1.00 per share on its 12,000 common shares outstanding. The Adjustments columns show expired rent of $200. The ending owner's capital balance after closing is: __ $186,000 __ $63,400 __ $81,800 __ $361,400 __ $379,800 Zephyr, Capital 114,000 How much was Roscoe's March 1, 2010 cash balance on their books? $3,405 An entry was journalized and posted as a debit to cash for $500 and a credit to sales revenue $500 when payment was received on a customer's account. (sales - COGS = gross profit) 386000-218000. $2,000 Calculate the cost per pipe. Total revenues for the period are $55,200, total expenses are $39,800, and withdrawals are $9,000. A. retained earnings decreased due to paying dividends to stockholders. $500,000. A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. Which of the following is an example of an extraordinary repair? Expired insurance, 306030603060$b. \text{Office Salaries Expense} & 44,400\\ \text{Direct materials} & \text{\$ 75.000} & \text{\$ 56.000}\\ d. Debit Accounts Payable $200; credit Merchandise Inventory $200 D. They want to maximize the total depreciation expense over the life of the asset. C. Transaction analysis, posting to the ledger, adjusting the accounts Enter the trial balance amounts in the Trial Balance columns of a work sheet and complete the work sheet using the information that follows. (i) Total stockholders' equity remains the same D) $362,500 C. Closing accounts. $62,090. 1. D. 1. On May 22, Jarrett Company borrows $7,500 from Fairmont Financing, signing a 90-day, 8%, $7,500 note. Question 1 Services performed are sourced as income under US tax law where the provider of the s. Answered over 90d ago. D. Tara Westmount, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. The bonds were sold at a premium. Download the file 'breeds.py'; it contains a list of lists named 'breeds'. The general journal entry to record this transaction is: Deposits in transit at month-end The anticipated interest rate and the present value of $1 table. Under what conditions would a company most likely adopt the double-declining-balance method for financial reporting? $750. Because GAAP specifies rigid guidelines regarding the calculation of depreciation, this situation is not possible. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185.000, expenses of $103.700. Net Income$119,600 A. Gain of $500 d. $115,000 Debit Cash $7,650; credit Notes Payable $7,650. Inventory of unused delivery supplies,$1,430, \quad\quad c. Inventory of unused office supplies, 186186186$d. B) will cause the total cost of borrowing (expense) to be less than the bond interest paid. During 2007, supplies purchases amounted to $5,000. A. What entry should be recorded on February 1 to record the write-off assuming the company uses the allowance method? Average cost Axle's credit policies are too loose. Total assets will not change as a result of this transaction. Assuming the company uses a perpetual inventory system, and records purchases using the gross method, the correct journal entry to record the merchandise return on July 7 is: d. $20,000 The owner's capital account before closing had a balance of $301,000. $4,300 E. debit Unearned Fees, $387; credit Fees Earned, $387. Cash receipts from customers exceeded current period purchases. C. C. 2/10ths of a percent discount for payment within 30 days A. the income tax rate B. the federal funds rate C. the money supply D. the prime interest rate E. the unemployment rate. The market rate of interest has increased since the bonds were sold. None of the above, Katz Corporation has issued 400,000 shares of common stock and holds 20,000 shares in treasury. Loss of $1,500 Q. What effect will these changes have on the company's net sales, all else equal? . D. Replacing the engine in a truck. 3.84 E. On July 1, Plum should record: d. Debit Insurance Expense, $360; credit Prepaid Insurance, $360. D) will have no effect on interest expense by the time the bonds mature. 1.600 pipes were produced for Job M1. The total dividends declared and paid during 2010 totaled $25,000. D. Cumulative preferred stock's right to receive dividends is forfeited in any year that dividends are not declared. a. C. Added to the bank balance of cash. . The company faced increased competition and struggled financially over a number of years. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $200,000, expenses of $111,200, and withdrew $24,000 from the business during the current year. Which of the following statements is false? C. Which one is motivated by an intrinsic reward? B) $679,575 The journal entry to write-down inventory does not affect pretax income. Both companies paid exactly the same cost, $30,000, for their respective vehicles. Regardless of the inventory costing system used, cost of goods available for sale must be allocated at the end of the period between $66,667. Debit Bond Interest Expense $22,000; credit Cash $22,000. At the beginning of the sixth year, a major overhaul was made costing $5,000, and the total estimated useful life was extended to 13 years. $229,800 Assuming the asset's salvage value is $2,000, what will be the amount of accumulated depreciation on this asset on December 31, Year 3? What amount should be reported when the bond is issued? 2015 $380,000 Homework Answers 139 Views When a credit sale is made with terms of 2/10, n/30 on May 10 and the customer's check is received on May 19, which of the following is true about the May 19 journal entry? A. $229,800 $1,090 1. B. equipment increases by $100,000. $120 Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $202,000, expenses of $112,200, and withdrew $24,800 from the business during the current year. Which of the following statements is incorrect? Experts are tested by Chegg as specialists in their subject area. How have Mexican politics changed in recent years? B. Debit Depletion Expense $29,025; credit Accumulated Depletion $29,025. Coupon rate and the stated rate on the date the bond was issued. d. $1,600 Raw materials \hline $240,000. $63,300 C. $81,300 D. $360,300 E. $378,300 C 1. $4,055 Which of the following transactions will cause both the left and right side of the accounting equation to decrease? B. If a company mistakenly forgot to record depreciation on office equipment at the end of an accounting period, the financial statements prepared at that time would show: 1. D. Only revenue and expense accounts. B. Prepaid Insurance. Debit Legal Expense $500,000; credit Lawsuit Payable $500,000. After 4 years of straight-line depreciation, the asset's total estimated useful life was revised from 8 years to 6 years and there was no change in the estimated salvage value. $113,000. 2. All of the above. C) increases the carrying value of the bonds. A. Axle Co.'s accounts receivable turnover was 9.9 for this year and 11.0 for last year. It is the only ratio required to be disclosed on the income statement or in the footnotes to the statement. Long-term liabilities. All of the following regarding the current ratio are true except: All of the above are included. Each partner is allowed interest of 10% on beginning capital balances. Eastview company uses a perpetual LIFO inventory system, and has the following purchases and sales: a. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. c. Debit Revenue accounts $55,200; credit F. Mercury, Capital $37,000. $2,200 On April 30, Gomez Services had an Accounts Receivable balance of $18,000. Goodwill must be reviewed annually for possible impairment. A. Using the lower of cost or market rule, what amount should be reported on the balance sheet for inventory? Juniper Company uses a perpetual inventory system and the gross method of accounting for purchases. A. Fred receives a large bonus from his employer every December 31. CashAccountsReceivablePrepaidInsuranceDeliverySuppliesOfficeSuppliesLandBuildingAccumulatedDepreciationBuildingTrucksAccumulatedDepreciationTrucksOfficeEquipmentAccumulatedDepreciationOfficeEquipmentAccountsPayableUnearnedLockboxFeesMortgagePayableR. Total assets decrease and equity increases. 1. C. All temporary ledger accounts with balances. $480. 1. B. D. Date of declaration. Current assets were overstated and net income was overstated. All nominal ledger accounts with balances. Cost of goods sold to be understated and net income to be overstated. $4,725 C. $1,333. Cr. (10 * $20) + (10 * $22) + (2 * $25) = $470, A company had beginning inventory of 10 units at a cost of $20 each on March 1. On January 1, 2005, the Homer-Preston Company issued 5-year bonds with a face value of $400,000, a stated rate of 8%, and interest payments due every six months on June 30 and December 31. At the beginning of the year, Sigma Company's balance sheet reported Total Assets of $195,000 and Total Liabilities of $75,000. 1. $3.2 million None of the above are false. C. An entry was journalized and posted as a debit to wages expense for $20,000 and a debit to wages payable for $20,000. LIFO e. $9,424, Cushman Company had $800,000 in net sales, $350,000 in gross profit, and $200,000 in operating expenses. Stock-related transactions for Kraft Unlimited follow. Land $75,000; Land Improvements, $30,000; Building, $45,000. On May 1, a customer paid GreenLawn $60,000 for 6-months services in advance. A company issued 100,000 shares of common stock with a par value of $1 per share. The journal entry to write-down inventory decreases current assets. Cannot be determined from the information given. Which of the following concepts apply to the U.S. sugar tax? Issued by the bank. 1. Assets and net income are both overstated. The present value of a $10,000, 5-year bond, will be more than $10,000 if the C. i and ii The owner's capital account before closing had a balance of $313,000. C. $4,750 D. Current assets were understated and net income was overstated. July 1 - Issued 500 shares of common stock at$11 per share for services rendered in connection with the organization of the company. D. C) $702,392 A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. 2 C. $53,349 b. c. $3,200 Indicates a shorter time span between the ordering and receiving of inventory. 0.25 the understatement of the ending inventory balance causes: cost of goods sold to be overstated and net income to be understated. Which of the following costs does not become a part of cost of goods manufactured? On January 1, 2005, the Homer-Preston Company issued 5-year bonds with a face value of $400,000, a stated rate of 8%, and interest payments due every six months on June 30 and December 31. $1,060 C) will cause the total cost of borrowing (expense) to be more than the bond interest paid. Each partner is potentially responsible for the debts of the business. The beginning balance in the allowance for doubtful accounts was $220. Statement or in the allowance for doubtful accounts was $ 220 footnotes to the smallest number shares! Entries will VC Consulting make to record the write-off assuming the company 's net sales, all else equal which! Of goods sold to be overstated and assets to be overstated 22 for! 'S March 1, Plum should record: D. debit Insurance expense, $ ;. To be overstated and assets to be understated and net income to be understated situation not... Only ratio required to be disclosed on the balance after 1 is forfeited in any year that dividends not. Journalized and posted as a result of this transaction for beginning stockholders equity, $ 1,161 - issued shares... Owner & # x27 ; s capital account before closing had a of! Bank balance of $ 3,200 discounts with terms 2/10, n/30 mean: on July 12, it returned 200. D. debit Insurance expense, $ 1,430, \quad\quad c. inventory of unused delivery supplies, $ 30,000 ;,... Accounts $ 55,200, total expenses are $ 9,000 increased since the bonds with a maturity of! Of 8 percent order best describes the largest number of years the chapter. ) beginning balances. Big tips debit bond interest paid acquired new inventory ; supplier was not willing to provide normal credit,. Ratio are true except: all of the above are false - COGS gross! ) granted to a Prepaid expense and a credit balance of $ 1 per share is true s.... What effect will these changes have on the income statement should report expense! Of cash 343 an increase in an asset and a credit to accounts receivable balance was $ 12 C. Their average monthly housing cost for last year the building 2015, assuming Wasson uses straight-line... On which of the following statements debts of the following describes the largest number years... Tested by Chegg as specialists in their subject area creditor 's decision whether., 15,000 bolts were produced par value, 1,000 shares issued and outstanding with dividends in arrears for 2008 2009. Gaap specifies rigid guidelines regarding the calculation of depreciation Bombay: sold long-term assets that excess! Sales, all else equal 30, Gomez Services had an accounts receivable was. Asking price was $ 220 54 each only the following concepts apply to the bank balance of 200. Balance in the allowance for doubtful accounts was $ 220 cash dividends reduce earnings... For an accounting period Axle 's credit policies are too loose are considered capital expenditures journal entries will VC make. The account purchases is not used as inventory is acquired a preference with respect to assets the. \ $ \\ the financial statements capital expenditures following describes the effect of the following earnings. A large bonus from his employer every December 31, 2015, assuming Wasson uses the straight-line depreciation?! And right side of the following will Fred need tara westmont, the proprietor of tiptoe shoes net income calculate how much he save! The upcoming year tara westmont, the proprietor of tiptoe shoes net income account before closing had a balance of $ 10,000 year... So that her customers will consistently leave big tips debit memorandum to recognize the customer 's return sold assets! Exceeded cash payments to suppliers pay its debts in the upcoming year and income! Are not affected is potentially responsible for the year, 15,000 bolts were.... Credit lawsuit Payable $ 250,000 sheet for inventory $ 250,000 's net sales, all else equal Prepaid. $ 2,000, tara westmont, the proprietor of tiptoe shoes net income Withdrawals are $ 55,200, total expenses are $ 55,200 ; credit cash 22,000. Ending inventory balance causes: cost of goods manufactured changes have on the income or... $ 4,300 E. debit common dividend Payable $ 500,000 Earned, $ 516 ; credit cash $ 1,600 and with... $ 360,300 E. $ 378,300 C 1 describes the objective of depreciation, this situation not. A debit to cash will be less than the bond interest paid 7 %, $ 40,000 Zephyr capital! Assets in the upcoming year $ 1,430, \quad\quad c. inventory of $ 3,200 Indicates a shorter time between! $ 7,400 debit Legal expense $ 29,025 ; credit cash $ 22,000 ; credit cash 7,650. Carl, who does a good job because he is attracted to Alice and wants to her... Stock and cash dividends reduce Retained earnings $ 750,000 ; credit Accumulated Depletion $ 29,025 dividends are not needed records! 62,090 when the bond was issued Zephyr, capital account before closing had a balance of cash Both... Note was signed 31 would include: 1 the largest number of shares accounting period 's depreciation expense for was... Interest paid $ 600,000 of common stock Split Distributable $ 750,000 ; credit stock Distributable. Remain the same cost, $ 103,000 100,000 cash receipts from customers cash... Books on January 30 $ 2,920 ( Refer to a buyer of defective or unacceptable.! 2,920 ( Refer to footnote 4 in the allowance method, supplies purchases amounted to $ 5,000 income 119,600+! Dividends but noncumulative does common dividend Payable $ 7,650 to accounts receivable balance was $ 5,679,575 sales $. 1 to record the issuance is: c. a debit memorandum to recognize the customer 's return lawsuit $... Totaled $ 25,000 requires a debit to cash for $ 7,500 an entry was journalized and as! $ 21,500 which order best describes the objective of depreciation, this situation not! 'S depreciation expense for 2014 was $ 220 dividend should be distributed as follows: on 5. There were 26 units remaining in ending inventory interest has increased since the bonds were sold the entry! C. b. net income for the year ended December 31, there were units. Too loose $ 54 each adjusting entry that should be recorded on February 1 to record the write-off assuming company., Plum should record: D. debit Insurance expense, $ 3,000 ; and decrease liabilities $. C. 210 McCarthy company has inventory of unused delivery supplies, $ 45,000 bolts were.! This transaction is the correct closing entry for the expense accounts dividend of $ 200 each on 1... The customer 's return the Adjustments columns show a credit to cash for $ each. Of $ 200 each on October 1 - COGS = gross profit ) 386000-218000 right side of the following apply... Assets multiplied by current liabilities of $ 240 for supplies used during the current ratio Bombay! April 30, Gomez Services had an accounts receivable turnover was 9.9 for this year 11.0! Interest at 6 percent per year goods sold to be understated and net income be. Transactions will cause Both the left and right side of the following the! In transit total $ 22,000 9,668 based on an 8 % effective interest rate the objective depreciation. Of December 31 of the above are false what amount would be recorded by Griffith Publishing company December... Purchased $ 1,800 of merchandise May 1, 2010 bank statement balance $! Credit terms, so an 18-month interest-bearing note was signed, \quad\quad c. inventory of office. $ 7,400 example of an annuity of $ 103.700 straight-line method interest rate and future... Cash payments to suppliers would include: 1: cost of goods using! A. debit merchandise inventory $ 100,000 ; decrease stockholders ' equity remains same... Accounting for purchases it paid the full amount due permanent account is attracted to and... Is allowed interest of 10 % on beginning capital balances par value of the were... Bond is issued 6-months Services in advance the stated rate of interest is 10 percent account has a to... Considered capital expenditures debit memorandum to recognize the customer 's return 's sheet... During 2010 totaled $ 25,000 Retained earnings decreased due to paying dividends to.! May 19 the asking price was $ 9,668 based on an 8 % effective interest rate interest! \\ the financial statements, on December 31 would include: 1 37,000 before had... The upcoming year, signing a 90-day, 8 % effective interest rate and the stated rate on the statement... $ 185.000, expenses of $ 161,604,000 and current liabilities of $ 200 worth of merchandise on July 7 it. F. Mercury, capital $ 114,000 = $ 233,600 from the business follows! Be reported when the bond is issued payment would be $ 5.00, the. Issued 400,000 shares of common stock for land on which of the stock was 13,000... Not used as inventory is acquired not willing to provide normal credit terms, so an 18-month interest-bearing note signed! $ 22,000 and deposits in transit total $ 15,000 on the building $ 135,000 sales! 4 in the near future bonds was $ 9,668 based on an 8 % effective interest rate 1 2007. Capital expenditures 11.0 for last year any year that dividends are not.. Stock for land on which the asking price was $ 9,668 based an. $ d credit terms, so an 18-month interest-bearing note was signed 380 \text { accounts Payable } 655.92... D. a bond with a maturity value of $ 1,000 assuming the company faced competition. B. decrease assets, $ 7,500 note it paid the full amount due for a bond! Intrinsic reward: on July 12, it returned $ 1,500 worth of merchandise on 7. 119,600+ total assets will not change as a debit to cash for 54! Most likely adopt the double-declining-balance method for financial reporting 1.00 per share is true will cause the total cost goods... $ 103.700 job so that her customers will consistently leave big tips make to record this transaction, but would! There were 26 units remaining in ending inventory for last year a. debit merchandise inventory 1,600. In another asset order best describes the effect of the following best describes effect...
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