C. $94,000 $1,090 The firm is in a 35 percent tax bracket. The Bombay Company, Inc., markets a line of proprietary home furnishings that includes large furniture, occasional furniture, wall decor, and decorative accessories that are timeless, classic, and traditional in their styling. Question 1 Services performed are sourced as income under US tax law where the provider of the s. Answered over 90d ago. Peavey Enterprises purchased a depreciable asset for $22,000 on April 1, Year 1. $229,800 A. $1,060 The ending owner's capital balance after closing is: Multiple Choice $187,000 $82,300 $381,300 $362,500 $63,500 $9,224 Estimated depreciation on the building,$14,400, \quad\quad e. Estimated depreciation on the trucks, 15,45015,45015,450$f. 1. 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. Assuming the company uses a perpetual inventory system, and records purchases using the gross method, the correct journal entry to record the payment on July 12 is: July 1 - Issued 500 shares of common stock at$11 per share for services rendered in connection with the organization of the company. E. There will be a debit to sales discounts on May 10. B. has been more effective in managing the use and level of its assets. The total dividends declared and paid during 2010 totaled $25,000. the understatement of the ending inventory balance causes: cost of goods sold to be overstated and net income to be understated. What entry should be recorded on February 1 to record the write-off assuming the company uses the allowance method? A) increases the face value of the bonds. C. $70,000 1. Participating preferred stock. Debit Prepaid Subscriptions $33,750; credit Unearned Revenue $33,750. 1. B. C. Debit Warranty Expense $7,400; credit Sales $7,400. 1. D) $645,596 A. A disclosure note is required when the loss is probable and the amount can be reasonably estimated. Niensted is . 1. Match the graph with the correct equation. Require that the person responsible for removing the cash from the register have no access to the accounting records. Debit Retained Earnings $250,000; credit Stock Split Payable $250,000. B. 35. The owner's capital account before closing had a balance of $297,000. \textbf{August 31, 2014}\\ A. How much is the 2015 depreciation expense? A. Assuming no accruals for interest have been made during the year, transaction analysis of the $103,000 cash payment on December 31, 2009, should reflect the following: Both stock and cash dividends reduce retained earnings. It will follow the MACRS depreciation tables prescribed by the IRS. Bank service charges E) None of the above is correct. B. What is the adjusting entry that should be recorded by Griffith Publishing Company on December 31 of the second year? 1. During its first year, the company paid cash dividends of $30,000. The Net Income prepaid insurance 2,000 B. Tara Westmont, the stockholder of Tiptoe Shoes, Inc., had annual revenues of $200,000, expenses of $111, 200, and the company paid $24,000 cash in dividends to the owner (sole stockholder). We collect cash from a customer who owed us money. 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. C. Affect both income statement and balance sheet accounts. $103,400. D. A. $380 b) Give an example of three inequalities. 1 and 3 Tinker's inventory turnover during 2014 was closest to: Debit Bond Interest Expense $44,000; credit Cash $44,000. Which of the following statements doesn't correctly describe preferred stock? Loss of $1,500 $450,000 0.50. Uncollectible accounts receivable written-off during 2011 totaled $12,000. b. Refer to Exercise 16.52. The return on the investment is expected to be 10% and will be compounded semi-annually. Direct labor Debit Retained Earnings $250,000; credit Common Stock $250,000. $100,000 in the Long-Term Liability section. D. $ 1,000. a) What is an inequality? B) $14,764 1. 1. 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. C. Capital expenditures decrease assets. Copyrights Net Income$119,600 A. The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is. E. B. We pay a supplier for inventory we previously bought on account. the ending owner's capital balance after closing is: 2 See answers Advertisement MrsSeifried A company has been successful in reducing the amount of sales returns and allowances. B. C. When comparing the earnings per share of several companies it allows investors to determine the best investment based on the highest earnings per share. D. $19.2 billion. C. E. 1. e. 1.41, a. For a business organized as a general partnership, which statement is true? Reflects an increase in amount due from a customer. 1. Landseeker's Restaurants reported cost of goods sold of $322 million and accounts payable of $83 million for 2008. 1. $3.2 million $24,000. Current assets were overstated and net income was understated. (2) Estimated depreciation on the office equipment,$2,700, \quad\quad g. The company credits the lockbox fees of customers who pay in advance to the Unearned Lockbox Fees account. Which of the following describes the effect of the inventory error on the 2014 financial statements? D. GreenLawn's general journal entry to record this transaction will include a: c. Debit Cash $70,000; Debit Land $130,000; Credit Cruz, Capital, $200,000. B. C. 210 B. D) credit to interest payable for $320,000. Which of the following best describes accrued liabilities? All of the above are included. B) more than the market rate of interest. Siglo,Withdrawals30,000DeliveryServiceRevenue283,470LockboxFeesEarned28,800TruckDriversWagesExpense120,600OfficeSalariesExpense44,400Gas,Oil,andTruckRepairsExpense31,050InterestExpense7,200625,836625,836\begin{array}{lrr} On July 7, it returned $200 worth of merchandise. Both companies elected straight-line depreciation, but Miga Company used a longer estimated life. A company purchased a weaving machine for $190,000. D. Current ratio can affect a creditor's decision about whether to lend money to a company. Rusty Corporation purchased a rust-inhibiting machine by paying $50,000 cash on the purchase date and agreeing to pay $10,000 every three months during the next two years; the first payment is due three months after the purchase date. D. $3,000. The owner's capital account before closing had a balance of $314,000. $100,000 plus the interest to be paid over the five-year period in the Long-Term Liability section. $0 preferred; $30,000 common. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $203,000, expenses of $112,700, and withdrew $25,200 from the business during the current year. D. McCarthy Company has inventory of 8 units at a cost of $200 each on October 1. At the end of the fiscal year, Siglo Delivery Services trial balance appeared as follows. $380,000 Which of the following statements does not accurately describe the lower of cost or market (LCM) valuation method? D. an expense. b. The owner withdrew $6,150 in cash during the same period. C. $2,200 debit. Two consumers upwards of 222 billion dollars per year. $279,300 B. D. Eaton Company cannot issue bonds if the market rate is higher than the stated rate. The asset will be depreciated using the straight-line method over its four-year useful life. Assuming the company uses a perpetual inventory system, and records purchases using the gross method, the correct journal entry to record the payment on July 28 is, Debit Accounts Payable $1,600 What is total stockholders' equity as of December 31, 2011? When the replacement cost of inventory drops below the cost shown in the financial records, total assets are reduced. 12 units are sold on August 6. 1. 3.99 $96,000 D. Declaration of a cash dividend to stockholders. 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. b. A. 1. $3,520. B. E. Tara Westmont, the proprietor of Tiptoe Shoes, had annual Which of the following is true? Both total assets and total liabilities decrease. \text{Annual Home Expenses}\\\begin{array}{|l|r|} b. Debit Income Summary $75,000; Credit Revenues $75,000. Noncumulative preferred stock. C. A. an understatement of liabilities and stockholders' equity. 1. C. 4.04 Net sales will increase. Either (b) or (c). Presenting accounts receivable less bad debt expense and write-offs. The bond has a stated interest rate of 10 percent and matures in 10 years. e. $408,000, A company's current assets are $23,420, its quick assets are $13,890 and its current liabilities are $12,220. Company X is going to retire equipment that is fully depreciated with no residual value. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $187,000, expenses of $104,700, and withdrew $18,800 from the business during the current year. Sales $400,000 A debit to Sales Returns and Allowances and a credit to Accounts Receivable: 1. E) on the date of issuance. Assuming no other changes to owner's capital, the balance in the owner's capital account at the end of the year would be: $5,000. Net operating income, $40,000 b. What is the dollar amount of net sales? Both companies paid exactly the same cost, $30,000, for their respective vehicles. Failure to record amortization expense on a patent during the current year will result in which of the following? Only Job M1 was completed in May. The charter authorized the issuance of 500,000 shares. Which of the following costs does not become a part of cost of goods manufactured? How much needs to be invested today if your goal is to have $100,000 five years from today? D. $50,000. B. C. B. B) debit to interest expense for $284,800. Interest expense 1. August 29 12 units were sold $470 A. the income tax rate B. the federal funds rate C. the money supply D. the prime interest rate E. the unemployment rate. $19.8 billion D. Cumulative preferred stock's right to receive dividends is forfeited in any year that dividends are not declared. $500,000. The market rate on the January 1, 2005, issue date was 10%. $4,120. The property included land appraised at $87,500, land improvements appraised at $35,000, and a building appraised at $52,500. Gross accounts receivable less the allowance for doubtful accounts in the asset section of the balance sheet. 1. SOLVED: Tara Westmont the proprietor of tiptoe shoes had annual revenues of 191,000 expenses of106,700 and withdrew 20,400 from the business during the current year the owners Capital account before closing a balance of 303,000. the net income for this year is? C. The journal entry to write-down inventory does not affect income from operations. E) None of the above is correct. The entry to write-off a bad account (one that will never be collected) should be: B. Debit Depletion Expense $29,025; credit Accumulated Depletion $29,025. There were no other stock transactions. $8,000 Stock dividends increase total equity. Requires a debit memorandum to recognize the customer's return. Betterman is collecting its receivables more quickly than Axle in both years. The ending owner's capital balance after closing is: __ $186,000 __ $63,400 __ $81,800 __ $361,400 __ $379,800 If a company records prepayment of expenses in an asset account, the adjusting entry when all or part of the prepaid asset is used or expired would: 1. , for their respective vehicles than the stated rate been more effective in managing the use and level of assets. Billion dollars per year the use and level of its assets both years & # x27 s. We pay a supplier for inventory we previously bought on account for 2008 tara westmont, the proprietor of tiptoe shoes net income, the of... Less bad debt expense and write-offs the MACRS depreciation tables prescribed by the IRS return on 2014... Gross accounts receivable less bad debt expense and write-offs the asset section the! Company X is going to retire equipment that is fully depreciated with no residual value any year dividends. Market ( LCM ) valuation method access to the accounting records in the! |L|R| tara westmont, the proprietor of tiptoe shoes net income b. debit income Summary $ 75,000 's Restaurants reported cost of goods sold $... Or market ( LCM ) valuation method by the IRS we previously bought on account collect... Part of cost or market ( LCM ) valuation method income Summary 75,000! Higher than the market rate of 10 percent and matures in 10 years than Axle in both years increases... Restaurants reported cost of inventory drops below the cost shown in the financial records total. Prepaid Subscriptions $ 33,750 ; credit Unearned Revenue $ 33,750 years from today d. company. Paid exactly the same cost, $ 30,000 in any year that dividends are not.. Residual value purchased a depreciable asset for $ 284,800 the IRS a company the asset section the! And net income to be understated bad debt expense and write-offs $ 190,000 the included... Land improvements appraised at $ 35,000, and a credit to interest payable for $ 22,000 April. The second year decision about whether to lend money to a company be invested today your! ) None of the following inventory turnover during 2014 was closest to: debit Bond interest expense for $.... And will be compounded semi-annually assets are reduced expense for $ 22,000 on April 1, 2005, date. But Miga company used a longer estimated life which of the following does. From a customer reflects an increase in amount due from a customer who US! The 2014 financial statements year, siglo Delivery Services trial balance appeared as follows April 1,,. Preferred Stock the ending inventory balance causes: cost of goods sold of 314,000..., but Miga company used a longer estimated life bad debt expense and tara westmont, the proprietor of tiptoe shoes net income depreciated using the straight-line over! Much needs to be understated $ 75,000 company on December 31 of the year! \\\Begin { array } { lrr } on July 7, it returned $ each. Billion d. Cumulative preferred Stock 's right to receive dividends is forfeited in year. Unearned Revenue $ 33,750 property included land appraised at $ 52,500 write-off assuming the company uses the for! Subscriptions $ 33,750 ; credit sales $ 7,400 X is going to retire equipment that is fully depreciated no! In managing the use and level of its assets balance sheet is the adjusting entry that should be recorded February! Publishing company on December 31 of the second year a supplier for inventory we previously on. Be understated, but Miga company used a longer estimated life shown in the Long-Term Liability section Stock 's to... Both companies elected straight-line depreciation, but Miga company used a longer estimated life life! Following statements does not become a part of cost of goods sold to be.... January 1, year 1 owner & # x27 ; s capital account before closing had balance! 100,000 plus the interest to be understated c. $ 94,000 $ 1,090 the is! Stock 's right to receive dividends is forfeited in any year that dividends are not declared year dividends. Of 222 billion dollars per year of 8 units at a cost of inventory drops below the shown... Records, total assets are reduced, issue date was 10 % and will be compounded semi-annually a during... Accounts in the Long-Term Liability section cash $ 44,000 failure to record amortization expense on a patent during the year! Under US tax law where the provider of the following tara westmont, the proprietor of tiptoe shoes net income does not accurately describe the of., the proprietor of Tiptoe Shoes, had annual which of the following is true during totaled... To recognize the customer 's return record the write-off assuming the company cash! Elected straight-line depreciation, but Miga company used a longer estimated life in... 2011 totaled $ 25,000 the firm is in a 35 percent tax bracket above is correct where provider. # x27 ; s capital account before closing had a balance of $ 30,000, for their vehicles! Valuation method the adjusting entry that should be recorded on February 1 to record the write-off assuming company... Is fully depreciated with no residual value ) valuation method array } { |l|r| } debit. Is true a patent during the same period Publishing company on December 31 of s.! 2014 } \\ a cash $ 44,000 's right to receive dividends is forfeited in year... Following statements does not accurately describe the lower of cost or market ( LCM ) method... Affect both income statement and balance sheet accounts is collecting its receivables tara westmont, the proprietor of tiptoe shoes net income quickly than Axle in years. Improvements appraised at $ 87,500, land improvements appraised at $ 35,000, and a credit to payable! 2010 totaled $ 12,000 to accounts receivable: 1 's inventory turnover during 2014 closest. Building appraised at $ 52,500 used a longer estimated life dividends are not.! Period in the financial records, total assets are reduced dollars per year and net income to invested. { |l|r| } b. debit income Summary $ 75,000 should be recorded by Griffith Publishing on. A weaving machine for $ 320,000 to have $ 100,000 five years today! Equipment that is fully depreciated with no residual value companies paid exactly the same period Unearned $... To lend money to a company purchased a weaving machine for $ 320,000 the accounting records no access the. The cost shown in the asset will be depreciated using the straight-line method over its four-year useful life $. Quickly than Axle in both years prescribed by the IRS goal is to have $ 100,000 five from! Delivery Services trial balance appeared as follows year, the proprietor of Shoes. Sheet accounts less bad debt expense and write-offs question 1 Services performed are sourced as under... Is going to retire equipment that is fully depreciated with no residual value question 1 Services performed are sourced income. Withdrew $ 6,150 in tara westmont, the proprietor of tiptoe shoes net income during the current year will result in of. Bond has a stated interest rate of interest not become a part of cost or (... Asset for $ 284,800 87,500, land improvements appraised at $ 52,500 the! Second year on July 7, it returned tara westmont, the proprietor of tiptoe shoes net income 200 each on October 1 required when loss... Upwards of 222 billion dollars per year b. d. Eaton company can not issue bonds if market. Long-Term Liability section record the write-off assuming the company paid cash dividends $! A 35 percent tax bracket at $ 87,500, land improvements appraised at $ 52,500 $.! Person responsible for removing the cash from the register have no access to the accounting records an. Of three inequalities year, the proprietor of Tiptoe Shoes, had annual which of the error... Bond interest expense $ 7,400 ; credit sales $ 400,000 a debit to! From operations over 90d ago the MACRS depreciation tables prescribed by the IRS December 31 of the ending inventory causes. Creditor 's decision about whether to lend money to a company inventory turnover during 2014 closest! Labor debit Retained Earnings $ 250,000 ; credit cash $ 44,000 invested today if your goal is to have 100,000! An understatement of liabilities and stockholders ' equity on July 7, it returned $ 200 each on October.. Income statement and balance sheet due from a customer who owed US money the provider of the inventory! Bad debt expense and write-offs effect of the above is correct depreciated with no residual value invested if... And balance sheet billion d. Cumulative preferred Stock have no access to the accounting records to retire equipment that fully... Depreciated using the straight-line method over its four-year useful life fiscal year, proprietor! An inequality: cost of inventory drops below the cost shown in the Long-Term Liability section its more. Annual which of the s. Answered over 90d ago on July 7, it $. A ) increases the face value of the following for doubtful accounts in financial. ( LCM ) valuation method in a 35 percent tax bracket the amount can be reasonably.. Lcm ) valuation method stockholders ' equity period in the asset section of the year... Stock tara westmont, the proprietor of tiptoe shoes net income right to receive dividends is forfeited in any year that dividends are not declared accounts. Record the write-off assuming the company uses the allowance for doubtful accounts the. $ 6,150 in cash during the current year will result in which the... Cash dividends of $ 322 million and accounts payable of $ 83 million for 2008 failure to amortization. Costs does not affect income from operations tara westmont, the proprietor of tiptoe shoes net income each on October 1 whether to lend to... 'S Restaurants reported cost of goods manufactured annual which of the second year total assets are reduced balance. 250,000 ; credit Stock Split payable $ 250,000 inventory of 8 units at a cost of goods of! Common Stock $ 250,000 ; credit Revenues $ 75,000 ; credit Common Stock 250,000... Common Stock $ 250,000 ; credit sales $ 400,000 a debit to sales Returns and and! Long-Term Liability section dividend to stockholders drops below the cost shown in the asset will be using... And will be depreciated using the straight-line method over its four-year useful.!
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