FINANCE

| March 14, 2016

Question 1

A company was recently formed with $ 50,000 cash contributed to the company by stock-holders. The company then borrowed $ 20,000 from a bank and bought $ 10,000 of supplies on account. The company also purchased $ 50,000 of equipment by paying $ 20,000 in cash and issuing a note for the remainder. What is the amount of total assets to be reported on the balance sheet?

$ 110,000

$ 90,000

$ 100,000

$120,000

3 points

Question 2

A company purchases $23,000 of supplies in the current month and promises to pay for them next month. How would the company record a liability for the supplies?

This liability is not a recognized liability until the payment is due.

$23,000 would be posted as a credit to accounts payable.

$23,000 would be posted as a credit to supplies expense.

$23,000 would be posted as a debit to accounts payable.

3 points

Question 3

A company was recently formed with $ 100,000 cash contributed to the company by stock-holders. The company then borrowed $ 50,000 from a bank and bought a $ 20,000 vehicle for cash. They also purchased $10,000 of equipment by paying $ 2,000 in cash and issuing a note for the remainder. What is the amount of total assets to be reported on the balance sheet?

$ 158,000

$ 160,000

$ 162,000

$ 100,000

3 points

Question 4

A company has net sales of $500,000 and cost of goods sold of $400,000. The company’s gross profit percentage is:

80%

20%

50%

10%

3 points

Question 5

A $ 1,000 sale is made on May 1 with terms 2/ 10, n/ 30. What amount, if received on May 9, will be considered payment in full?

$ 1,000

$ 900

$ 800

$ 980

3 points

Question 6

The 200X records of Thompson Company showed beginning inventory of $6,000, cost of goods sold of $14,000 and ending inventory of $8,000. The cost of purchases for 200X was:

$12,000

$10,000

$ 9,000

$16,000

3 points

Question 7

Post Company began the current month with $10,000 in inventory, then purchased inventory at a cost of $35,000. The inventory at the end of the month was $20,000. The cost of goods sold would be:

$30,000

$35,000

$25,000

$15,000

3 points

Question 8

A company lends its CEO $150,000 for 3 years at a 6% annual interest rate. Interest payments are to be made twice a year. Each interest payment will be for:

$9,000

$4,500

$27,000

$13,500

3 points

Question 9

Post Company lends Blue Company $40,000 on April 1, accepting a 4 month, 4.5% interest note. Post Company prepares financial statements on April 30. What adjusting entry should they make?

Debit note receivable $40,000; Credit Cash $40,000

Debit interest receivable $150; Credit interest revenue $150

Debit cash $150; Credit interest revenue $150

Debit interest receivable $600; Credit interest revenue $600

3 points

Question 10

On January 1, 200X Jones Company purchased a machine for $20,000. The machine had a salvage value of $2,000 and a useful life of 5 years. Using straight line depreciation, the accounting entry for recording depreciation expense for 200X would be:

Debit depreciation expense – $3,600, credit accumulated depreciation – $3,600.

Debit depreciation expense – $4,000, credit accumulated depreciation – $4,000.

Debit depreciation expense – $3,600, credit machine – $3,600.

Debit depreciation expense – $4,000, credit machine – $4,000.

3 points

Question 11

Post Company uses straight- line depreciation for all of its depreciable assets. Post sold a piece of machinery on December 31, 2009, that it purchased on January 1, 2009 for $ 2,000. The asset had a five year life and zero residual value. Accumulated depreciation was $400. If the sales price of the used machine was $ 1,200, the resulting gain or loss on disposal was which of the following amounts?

Loss of $ 400.

Loss of $ 800.

Gain of $ 400.

Gain of $ 1,200.

3 points

Question 12

On July 1, 200X you enter into a note payable of $200,000 with a 5% annual interest rate. Your interest expense for 200X will be:

$2,500

$10,000

$2,000

$5,000

3 points

Question 13

Post Company issues a 6 year, 6%, $200,000 bond at par on July 31. How much interest will be paid over the life of the bond?

$4,000

$6,000

$12,000

$72,000

Order your essay today and save 30% with the discount code: ESSAYHELP
Order your essay today and save 30% with the discount code: ESSAYHELPOrder Now