Question 1:
Determine the missing amount and enter it in the space provided.
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Balance Sheet Values as of December 31, 2014
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Assets
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Liabilities
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Shareholders' Equity
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$22151
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$9,438
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?
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Question 2:
A company's revenues for a period of time can be found...
on the Balance Sheet.
on the Income Statement.
on the Statement of Shareholders' Equity.
on the Statement of Cash Flows.
Question 3:
Which of the following accounts will appear on an Income Statement?
Cash Received from Customers
Accounts Receivable
Sales Revenue
Unearned Revenue
Question 4:
The amount owned to a bank at the end of a period can be found...
on the Balance Sheet.
on the Income Statement.
on the Statement of Cash Flows.
on the Statement of Shareholders' Equity.
Question 5:
A company's cost of goods sold expense can be found...
on the Statement of Shareholders' Equity.
on the Balance Sheet.
on the Income Statement.
on the Statement of Cash Flows.
Question 6:
Which of the following accounts will appear on a Balance Sheet?
Interest Income
Interest Paid in Cash
Interest Expense
Interest Payable
Question 7:
Compute the unknown amount reference by the question mark in the following table:
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Beginning of Year
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Assets
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$1,800
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Liabilities
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1,300
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End of Year
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Assets
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2,600
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Liabilities
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1240
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During the Year
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Common Stock Issued
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600
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Revenues
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2,400
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Expenses
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?
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Cash Dividends Declared and Paid
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210
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Question 8:
Naughton Ltd. has excess space in its warehouse that it rents out to another company, Aobdia S.A. On December 31, 2014, Naughton received a full year's rent payment for $24,000 from Aobdia S.A. for the use of the warehouse space for the calender year 2015. Choose the correct entry (if any) to be made on December 31, 2014.
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DR Cash (+A)
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$2,000
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CR Rent Revenue (+R, +SE)
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$2,000
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DR Unearned Revenue (-L)
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$24,000
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CR Revenue (+R, +SE)
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$24,000
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No entry should be made at this time.
DR Cash (+A) $24,000
CR Unearned Revenue (+L) $24,000
Question 9:
On April 1, 2014, Naughton Ltd. purchased $43,000 of merchandise inventory from a wholesale distributor. Naughton Ltd. intends to offer these items for sale to its customers. The merchandise was received on that date and would be paid for at the end of April 2014. Choose the correct entry (if any) to be made on April 1, 2014.
DR Merchandise Inventory (+A) $43,000
CR Accounts Payable (+L) $43,000
No entry should be made at this time.
DR Merchandise Inventory (+A) $43,000
CR Cash (-A) $43,000
DR Cost of Goods Sold Expense (+E, -SE) $43,000
CR Accounts Payable (+L) $43,000
DR Merchandise Inventory (+A) $43,000
CR Accounts Payable (+L) $43,000
Question 10:
On January 1, 2014, Naughton Ltd. issued common stock to shareholders in exchange for $10,000 cash. Choose the correct entry (if any) to be made on January 1, 2014.
No entry should be made at this time.
DR Cash (+A) $10,000
CR Retained Earnings (+SE) $10,000
DR Cash (+A) $10,000
CR Shareholders' Equity (+SE) $10,000
DR Shareholders' Equity (-SE) $10,000
CR Cash (-A) $10,000
Question 11:
Magee Corp. maintains an inventory of supplies that employees use in the company's operations. Supply purchases are recorded in the inventory, but there is no elaborate accounting system for inventory withdrawals - the employees simply take what is needed. However, a physical count and valuation of the inventory is conducted at the end of each calender quarter. On March 31, 2014, the balance sheet reported a supplies inventory value of $7,200. During the quarter ending June 30, 2014, Magee Corp. purchased supplies costing $11,200. The physical count of inventory on June 30, 2014 revealed a value of $9,700. Magee Corp. closes its books and issue financial statements on a quarterly basis. What accounting entry (if any) should Magee Corp. make on June 30, 2014?
DR Supplies Inventory (+A) $9,700
CR Supplies Expense (-E, +SE) $9,700
DR Supplies Expense (+E, -SE) $11,200
CR Supplies Inventory (-A) $11,200
DR Supplies Expense (+E, -SE) $8,700
CR Supplies Inventory (-A) $8,700
Question 12:
On January 1, 2014, Magee Corp. borrowed $200,000 from a local financial institution. The note payable has annual interest rate of 4%. Interest payments are made annually on the anniversary of the note (that is, January 1). The note's principal of $200,000 must be repaid on January 1, 2016. Magee Corp. closes its books and issues financial statements on a quarterly basis. What accounting entry (if any) should Magee Corp. make on March 31, 2014?
DR Interest Expense (+E, -SE) $2,000
CR Interest Payable (+L) $2,000
DR Interest Payable (-L) $8,000
CR Interest Expense (-E, +SE) $8,000
No entry should be made.
DR Interest Expense (+E, -SE) $2,000
CR Cash (-A) $2,000
Question 13:
At the end of every quarter, Magee Corp. determines its revenues and operating expenses for that period. The company must pay taxes on the operating income (revenues less operating expenses) by the end of the month following its fiscal quarter, which Magee Corp. does. Magee Corp.'s tax rate is 40% of its operating income. Magee Corp. closes its books and issues financial statements on a quarterly basis. On September 30, 2014, Magee Corp. determined that its pre-tax operating income was $45,000 for the quarter ending on that date. What accounting entry (if any) should Magee Corp. make on September 30, 2014?
DR Income Tax Expense (+E, -SE) $18,000
CR Cash (-A) $18,000
No entry should be made.
DR Income Tax Payable (-L) $18,000
CR Cash (-A) $18,000
DR Income Tax Expense (+E, -SE) $18,000
CR Income Tax Payable (+L) $18,000
Question 14:
The Effects of Accounting Entries
At the very end of its reporting period, Dye Company, Inc. made the following entry into the company's accounts:
DR Retained Earnings (-SE) $6,000
CR Cash (-A) $6,000
In the absence of any other changes to the accounting, what effect(s) will the entry above have on the period's ending financial statements? Check all correct answers below.
End-of-period shareholders' equity will decrease.
Net income for the period will decrease.
End-of-period total assets remain unchanged.
Expenses for the period will increase.
Question 15:
The Effects of Accounting Entries
At the very end of its reporting period, Dye Company, Inc. made the following entry into the company's accounts:
DR Equipment (+A) $27,000
CR Cash $27,000
In the absence of any other changes to the accounting, what effect(s) will the entry above have on the period's ending financial statements? Check all correct answers below.
End-of-period shareholders' equity will decrease.
End-of-period total assets will increase.
Net income for the period will decrease.
End-of-period liabilities plus shareholders' equity will remain unchanged.
Question 16:
At the very end of its reporting period, Dye Company, Inc. made the following entry into the company's accounts:
DR Insurance Expense (+E, -SE) $4,000
CR Prepaid Insurance (-A) $4,000
In the absence of any other changes to the accounting, what effect(s) will the entry above have on the period's ending financial statements? Check all correct answers below.
End-of-period shareholders' equity will decrease.
Net income for the period will decrease.
Expenses for the period will increase.
End-of-period cash balance will decrease.
Question 17:
At the very end of its reporting period, Dye Company made the following entry into the company's accounts:
DR Depreciation Expense (+E, -SE) $20,000
CR Accumulated Depreciation (+XA, -A) $20,000
In the absence of any other changes to the accounting, what effect(s) will the entry above have on the period's ending financial statements? Check all correct answers below.
End-of-period total assets will be unchanged.
End-of-period cash will increase.
Net income for the period will increase.
Net income for the period will decrease.
Question 18:
At the very end of its reporting period, Dye Company, Inc. made the following entry into the company's accounts:
DR Rent Expense (+E, -SE) $13,000
CR Cash (-A) $13,000
In the absence of any other changes to the accounting, what effect(s) will the entry above have on the period's ending financial statements? Check all correct answers below.
Net income for the period will increase.
Net income for the period will decrease.
End-of-period cash balance will decrease.
End-of-period total assets will decrease.
Question 19:
Sridhar Consulting Ltd. (SCL) pays its employees every Friday. In addition, SCL closes its books and issues financial statements at the end of every calender quarter. The company's balance sheets show a liability called Wages payable with values of £24,000 on December 31, 2013 and £23159 on March 31, 2014. SCL reported wage expense of £78247 in its income statement for the quarter ended March 31, 2014.
How much cash was paid to employees for the quarter ended March 31, 2014? £____________
Question 20:
Sridhar Consulting Ltd. (SCL) keeps an inventory of office supplies for its employees to use on client projects. There is no continuous-time tracking system for the supplies - employees have access to the inventory and use what is needed for their projects. However, purchases of supplies are tracked, and a physical count of the supplies inventory is conducted at the end of every quarter.
The company's balance sheets show an asset called Supplies inventory with values of £7,500 on December 31, 2013 and £8378 on March 31, 2014. SCL recorded supply purchases of £12366 during the quarter ended March 31, 2014.
How much should be recognized as supplies expense on the income statement for the quarter ended March 31, 2014? £.