Need answers to test 061691 1. Which of the following would…
Need answers to test 061691...
Need answers to test 061691 Submitted: 9 years ago.Category: Business and Finance Homework
1. Which of the following would not be considered a contingent liability? A. Potential fines from the EPA B. Pending legal action C. Cosigning a loan D. Mortgage payable (2) Ryan Corporation made a basket purchase of three items. Item A was appraised at $35,000; item B was appraised at $55,000; and item C was appraised at $60,000. The purchase price was $125,000. The amount at which item B should be recorded is A. ($55,000/$150,000) × $125,000. B. $55,000/$95,000) × $125,000. C. ($55,000/$125,000) × $150,000. D. ($55,000/$95,000) × $150,000 (3.) Research and development costs (R&D) are generally , A. listed as "current assets" on the balance sheet. B. listed as "long-term assets" on the balance sheet. C. listed as "other intangibles" on the balance sheet. D. expensed and become part of the income statement (4.) Which of the following marketable securities are reported at market value on the balance sheet date? A. Trading securities B. Available-for-sale and trading securities C. Held-to-maturities securities D. Available-for-sale securities (5) Brandon Corporation purchased a vein of mineral ore for $3,250,000. It is estimated that 15,000,000 tons of ore are available to be extracted. The salvage value is determined to be $400,000. The estimation depletion expense for this year's extraction of 1,760,000 tons of ore (rounded to the nearest dollar) is A. $334,400. B. $381,333. C. $428,267. D. $400,000 (6.) Using a 360-day year, the maturity value of a 69-day note for $1,500 at 7% annual interest is (rounded to the nearest cent) A. $1,605.00. B. $20.13. C. $1,584,88. D. $1,520.13 (7.) If the amount extracted from a coal mine was different every year for four years, you would A. use the same depletion expense rate per unit each year. B. recompute the depletion expense rate per unit each year. C. debit depletion expense for the same amount each year. D. credit accumulated depletion— coal mine for the same amount each year. (8.) If a $6,000, 10%, 10-year bond was issued at 104 on October 1, 2011, how much interest will accrue on December 31 if interest payments are made annually? A. $150 B. $500 C. None D. $104 (9.) Jewell Company has current assets of $56,000; long-term assets of $135,000; current liabilities of $44,000; and long-term liabilities of $90,000. Jewell Company's debt ratio is A. 239.3%. B. 78.6%. C. 127.3%. D. 70.2%. (10.) A truck costing $56,000 has accumulated depreciation of $50,000. The truck is scrapped for $500. The journal entry to record this transaction is A. debit Cash for $500, debit Truck for $50,000, debit Loss on Disposal for $5,500, and credit Accumulated Depreciation—Truck for $56,000. B. debit Cash for $500, debit Accumulated Depreciation—Truck for $50,000, debit Loss on Disposal for $5,500, and credit Truck for $56,000. C. debit Loss on Disposal $6,000, debit Accumulated Depreciation—Truck for $50,000, and credit Truck for $56,000. D. debit Cash for $500, debit Loss on Disposal for $55,500, and credit Truck for $56,000. (11.) Tammy Industries inadvertently debited a $5,000 betterment as an ordinary expense. Which of the following will occur as a result of this mistake? A. The asset will be understated by $5,000. B. Retained earnings will be overstated by $5,000. C. The asset will be overstated by $5,000. D. Net income will be overstated by $5,000.(12). Which of the following would indicate poor internal control over accounts receivable? A. The person handling cash receipts passes the receipts to someone who enters them into accounts receivable. B. The same person handling cash receipts also records the accounts receivable transactions. C. The mailroom employees open the mail and give the cash receipts to another employee. D. The person who handles accounts receivable wouldn't write off accounts as uncollectable. (13.) Rick Company has cash of $143,000; net accounts receivable of $89,000; short-term investments of $35,000; and prepaid expenses of $40,000. It also has $50,000 in current liabilities and $80,000 in long-term liabilities. The quick ratio for Rick Company is A. 4.64. B. 5.34. C. 3.34. D. 6.14.
(14). Casey Company's bank statement shows a bank balance of $43,267. The statement shows a bank service charge of $50 and a bank collection of $760 in Casey Company's behalf. Casey's book balance should be adjusted by a total of A. +$810. B. –$710. C. +$710. D. +$760. (15). Margaret is a customer of Tammy Company. The company wrote off her account of $1,200 on August 15. On October 12, she sent in a payment of $560. What will Tammy Company record first to reinstate her account? A. Debit Uncollectible Accounts Expense; credit Accounts Receivable/Margaret. B. Debit Cash; credit Accounts Receivable/Margaret. C. Debit Allowance for Doubtful Accounts; credit Accounts Receivable/Margaret. D. Debit Accounts Receivable/Margaret; credit Allowance for Doubtful Accounts (16.) Amanda Industries had total assets of $600,000; total liabilities of $175,000; and total stockholders' equity of $425,000. Amanda Industries' debt ratio is A. 70.8%. B. 17.1%. C. 29.2%. D. 41.2%. ( 17.) Mackey Company has a five-year mortgage for $100,000. In the first year of the mortgage, Mackey will report this liability as a A. current liability of $20,000 and a long-term liability of $80,000. B. long-term liability of $100,000. C. current liability of $100,000. D. current liability of $80,000 and a long-term liability of $20,000.(18.) By not accruing warranty expense, A. reported expenses will be understated, and net income will be understated. B. reported liabilities will be overstated, and net income will be understated. C. reported liabilities will be understated, and net income will be overstated. D. reported expenses will be overstated, and reported liabilities will be understated (19. )Ryan Corporation made a basket purchase of three items. Item A was appraised at $35,000; item B was appraised at $55,000; and item C was appraised at $60,000. The purchase price was $125,000. The amount at which item C should be recorded (rounded to the nearest dollar) is A. $29,167. B. $50,000. C. $72,000. D. $83,300. (20.) A company receives a note payable for $3,500 at 9% for 45 days. How much interest (to the nearest cent) will the customer owe using a 360-day year? A. $38.84 B. $315.00 C. $354.38 D. $39.38