1. Accompanying the bank statement was a credit memo for a short-term note collected by the bank for the customer. What entry is required in the companys accounts?

1. Accompanying the bank statement was a credit memo for a short-term note collected by the bank for the customer. What entry is required in the companys accounts?

1. Accompanying the bank statement was a credit memo for a short-term note collected by the bank for the customer. What entry is required in the companys accounts? debit Notes Receivable; credit Cashdebit Cash; credit Miscellaneous Incomedebit Cash; credit Notes Receivabledebit Accounts Receivable; credit Cash2. A bank reconciliation should be prepared whenever the bank refuses to lend the company money.to explain any difference between the companys balance per books with the balance per bank.when an employee is suspected of fraud.by the person who is authorized to sign checks.3. The debit recorded in the journal to reimburse the petty cash fund is toPetty CashAccounts ReceivableCashvarious accounts for which the petty cash was disbursed4. A check drawn by a company for $270 in payment of a liability was recorded in the journal as $720. This item would be included on the bank reconciliation as a(n) addition to the balance per the companys recordsaddition to the balance per the bank statementdeduction from the balance per the bank statementdeduction from the balance per the companys records5. The term receivables¬Ě includes all money claims against other entities.merchandise to be collected from individuals or companies.cash to be paid to creditors.cash to be paid to debtors.6. A 90-day, 12% note for $20,000, dated April 10, is received from a customer on account. If the note is discounted at 15% on May 20, the days in the discount period are 50 90120407. The amount of the promissory note plus the interest earned on the due date is called the realizable valuematurity valueface valuenet realizable value8. A 90-day, 12% note for $20,000, dated September 10, is received from a customer on account. If the note is discounted at 15% on October 10, the due date is December 9 December 10December 11December 89. A new machine with a purchase price of $94,000, with transportation costs of $8,000, installation costs of $5,000, and special acquisition fees of $2,000, would have a cost basis of $ 99,000$107,000$102,000$109,000 10. An asset was purchased for $120,000 and originally estimated to have a useful life of 10 years with a residual value of $10,000. After two years of straight line depreciation, it was determined that the remaining useful life of the asset was only 4 years with a residual value of $2,000. Calculate this years depreciation using the revised amounts and straight line method. $25,000$11,000$24,000 $24,50011. All leases are classified as either capital leases or long-term leasescapital leases or operating leasesoperating leases or current leaseslong-term leases or current leases12. The most widely used depreciation method isstraight-linesum-of-the-years-digitsdeclining-balanceunits-of-production13. Notes may be issued when assets are purchasedto creditors to temporarily satisfy an account payable created earlierwhen borrowing moneyall of the above14. Most employers are required to withhold from employees for both federal and state unemployment compensationonly federal unemployment compensation taxonly federal income taxonly state unemployment compensation tax15. Which statement below is not a determinate in calculating the amount of federal income taxes withheld from an individuals pay? filing statustypes of earningsgross paynumber of exemptions16. Payroll taxes levied against employees become liabilities the first of the following monthat the time the payroll is paidwhen earned by the employeeat the end of an accounting period17. Which of the following is not a right possessed by common stockholders of a corporation?the right to vote in the election of the board of directorsthe right to receive a minimum amount of dividendsthe right to sell their stock to anyone they choosethe right to share in assets upon liquidation18. The term deficit is used to refer to a debit balance in which of the following accounts of a corporation?Retained EarningsTreasury StockOrganizational ExpensesCommon Stock19. One of the main disadvantages of the corporate form is theprofessional managementdouble taxation of dividendschartercorporation must issue stock20. The journal entry to issue 1,000,000 shares of $5 par common stock for $6.75 per share on January 2nd would be: Jan 2 Dr Cash 6,750,000Cr Common Stock 5,000,000Cr Paid-In Capital in Excess of Par C/S 1,750,000Jan 2 Dr Cash 5,000,000Cr Common Stock 5,000,000Jan 2 Dr Cash 5,000,000Dr Paid-In Capital in Excess of Par C/S 1,750,000Cr Common Stock 6,750,000Jan 2 Dr Cash 1,000,000Cr Common Stock 1,000,00021. Which of the following statements is not true about a 2-for-1 split? Par value per share is reduced to half of what it was before the split.Total contributed capital increases.The market price will probably decrease.A stockholder with ten shares before the split owns twenty shares after the split.22. The cumulative effect of the declaration and payment of a cash dividend on a companys financial statements is to decrease total liabilities and stockholders equity.increase total expenses and total liabilities.increase total assets and stockholders equity.decrease total assets and stockholders equity.23. Which of the following is not classified as paid-in capital on the balance sheet?common Stockcommon stock distributabledonated capitaltreasury stock24. The date on which a cash dividend becomes a binding legal obligation is on thedeclaration datedate of record.payment date.last day of the fiscal year end.25. Debenture bonds are bonds secured by specific assets of the issuing corporationbonds that have a single maturity dateissued only by the federal governmentissued on the general credit of the corporation and do not pledge specific assets as collateral26. A corporation issues for cash $15,000,000 of 8%, 30-year bonds, interest payable annually, at a time when the market rate of interest is 9%. The straight-line method is adopted for the amortization of bond discount or premium. Which of the following statements is true? The amount of annual interest paid to bondholders remains the same over the life of the bonds.The amount of annual interest expense decreases as the bonds approach maturity.The amount of annual interest paid to bondholders increases over the 30-year life of the bonds.The carrying amount decreases from its amount at issuance date to $15,000,000 at maturity.27. Bonds with a face amount $1,000,000, are sold at 106. The entry to record the issuance is Dr Cash 1,000,000Dr Premium on Bonds Payable 60,000Cr Bonds Payable 1,060,000 Dr Cash 1,060,000Cr Premium on Bonds Payable 60,000Cr Bonds Payable 1,000,000 Dr Cash 1,060,000Cr Discount on Bonds Payable 60,000Cr Bonds Payable 1,000,000Dr Cash 1,060,000Cr Bonds Payable 1,060,000 28. One potential advantage of financing corporations through the use of bonds rather than common stock is the interest on bonds must be paid when duethe corporation must pay the bonds at maturitythe interest expense is deductible for tax purposes by the corporationa higher earnings per share is guaranteed for existing common shareholders29. Which of the following represents an inflow of cash and therefore would be reported on the statement of cash flows? appropriation of retained earningsacquisition of treasury stockdeclaration of stock dividendsissuance of long-term debt30. Cash paid for equipment would be reported in the statement of cash flows in the cash flows from operating activities sectionthe cash flows from financing activities sectionthe cash flows from investing activities sectiona separate schedule31. The statement of cash flows may be used by management to assess the liquidity of the businessassess the major policy decisions involving investments and financingdetermine dividend policydo all of the above32. If a gain of $9,000 is incurred in selling (for cash) office equipment having a book value of $55,000, the total amount reported in the cash flows from investing activities section of the statement of cash flows is (Points : 3)$46,000$9,000$55,000$64,000 33. Which one of the following below would not be classified as an operating activity? interest expenseincome taxespayment of dividendsselling expenses34. Which of the following does not represent an outflow of cash and therefore would not be reported on the statement of cash flows as a use of cash? purchase of noncurrent assetspurchase of treasury stockdiscarding an asset that had been fully depreciatedpayment of cash dividends35. On the statement of cash flows, the cash flows from financing activities section would include receipts from the sale of investmentspayments for the acquisition of investmentsreceipts from a note receivablereceipts from the issuance of capital stock


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