Great Deal! Get Instant $25 FREE in Account on First Order + 10% Cashback on Every Order Order Now

1. Adam's Produce opened business on January 1, 2015, and paid for two insurance policies effective that date. The liability policy was $36,000 for eighteen months, and the crop damage policy was...

1 answer below »
1. Adam's Produce opened business on January 1, 2015, and paid for two insurance policies effective that date. The liability policy was $36,000 for eighteen months, and the crop damage policy was $12,000 for a two-year term. What was the balance in Adam's prepaid insurance as of December 31, 2015?
A. $9,000
B. $18,000
C. $30,000
D. $48,000
2. What's required when creating an adjusting entry when amounts were previously recorded as defe
ed revenues?
A. A credit to a liability
B. A debit to an asset
C. A credit to an asset
D. A debit to a liability
3. On September 1, 2015, Kromcast sold 600 one-year subscriptions for $81 each. The total amount received was credited to defe
ed subscriptions revenue. What would be the required adjusting entry at December 31, 2015?
A.
Defe
ed subscriptions revenue    16,200
Subscriptions payable        16,200
B.
Defe
ed subscriptions revenue    48,600
Subscriptions revenue    16,200
Prepaid subscriptions        32,400
C.
Defe
ed subscriptions revenue    16,200
Subscriptions payable        16,200
D.
Defe
ed subscriptions revenue    16,200
Subscriptions revenue    16,200
4. Which of the following accounts has a balance whereby debits normally exceed credits?
A. Advertising expense
B. Accounts payable
C. Accumulated depreciation
D. Accrued taxes
5. In its first year of operations, Number One Corp. had income before tax of $500,000. Number One made income tax payments totaling $210,000 during the year and has an income tax rate of 40%. What was Number One's net income for the year?
A. $300,000
B. $290,000
C. $306,000
D. $294,000
6. Rent collected in advance is considered
A. a temporary account, not in the balance sheet at all.
B. a shareholders' equity account in the balance sheet.
C. a liability account in the balance sheet.
D. an asset account in the balance sheet.
7. What's an example of a contra account?
A. Sales revenue
B. Accumulated depreciation
C. Accounts receivable
D. Depreciation expense
8. Which of the following is a cu
ent liability account?
A. Subscriptions collected in advance from customers
B. Prepaid rent
C. Accumulated depreciation
D. Depreciation
9. Which of the following is a permanent account?
A. Accumulated depreciation
B. Cost of goods sold
C. Depreciation expense
D. Gain on sale of equipment
10. What happens when a company accrues salaries at the end of the accounting period?
A. Its cu
ent ratio increases
B. Its debt to equity ratio increases
C. Its acid-test ratio increases
D. Its debt to equity ratio decreases
11. Smith's Corporation Co.'s trial balance included the following account balances at December 31, 2015:
Accounts payable        $25,000
Bond payable, due 2025        22,000
Salaries payable            16,000
Note payable, due 2016        20,000
Note payable, due 2021        40,000
What amount should be included in the cu
ent liability section of Smith's December 31, 2015, balance sheet?
A. $61,000
B. $101,000
C. $41,000
D. $63,000
12. What are notes payable that are due in two years considered?
A. Long-term investments
B. Long-term liabilities
C. Cu
ent liabilities
D. Long-term intangible assets
13. Amy's Computers is preparing an annual report for the cu
ent fiscal year. The company's controller has asked for your help in determining how best to disclose information about the inventory costing method. Where should this information be disclosed?
A. In the summary of significant accounting policies note
B. It doesn't need to be disclosed
C. In a separate disclosure note
D. On the face of the balance sheet
14. Which of the following accounts has a balance whereby debits normally exceed credits?
A. Accrued income taxes payable
B. Prepaid rent
C. Salary expense accounts payable
D. Land
15. On January 1, Loyal Corp. began operating a service company with an initial cash investment by shareholders of $2,000,000. The company provided $6,400,000 of services in January and received full payment in Fe
uary. Royal also incu
ed expenses of $3,000,000 in January that were paid in March. During January, Loyal paid its shareholders cash dividends of $1,000,000. What was the company's income before income taxes for the two months ended Fe
uary 28 under the following methods of accounting?
A. cash: $5,400,000/accrual: $2,400,000
B. cash: $6,400,000/accrual: $2,400,000
C. cash: $6,400,000/accrual: $3,400,000
D. cash: $3,400,000/accrual: $3,400,000
16. Based on recent financial statement data for Quantity Foods, Inc. (QF), shown below, what's QF's times interest earned ratio? (rounded)
Cu
ent liabilities    $ 180        Income before interest and taxes    $ 125
10% Bonds, long-term XXXXXXXXXX        Interest expense             XXXXXXXXXX
Total liabilities     XXXXXXXXXX540        Income before tax     XXXXXXXXXX89
Shareholders' equity            Income tax     XXXXXXXXXX27
Capital stock     XXXXXXXXXX200        Net income                $ 62
Retained earnings     XXXXXXXXXX            
Total shareholders' equity 480            
Total liabilities and equity $1,020

A. 10.0
B. 2.47
C. 1.73
D. 3.47
17. Which of the following is a temporary account?
A. Inventory
B. Depreciation expense
C. Salaries payable
D. Cash
18. GM Motor Company purchases services from suppliers on account and sells its products to distributors on short-term credit. Thus, do each of these events affect net income faster than they affect net operating cash flows?
A. Purchase Services: No / Sell Products: No
B. Purchase Services: No / Sell Products: Yes
C. Purchase Services: Yes / Sell Products: Yes
D. Purchase Services: Yes / Sell Products: No
19. The perceived lack of _______ was most likely the important flaw that lead to the demise of the APB.
A. importance
B. competence
C. independence
D. confidence
20. What will a balance sheet report?
A. Assets and liabilities for a period of time
B. Assets and equities at a point in time
C. Cash flow for a period of time
D. Net income at a point in time
Answered Same DayDec 25, 2021

Solution

Bhavani answered on Dec 29 2021
56 Votes
MCQ answers
1)B. $18,000
Answer:
36000 /18 = $2000 per month * 12 months= $24000
12000/24 = $500 per months * 12 months= $6000
=$24000+ $6000 = $30,000
$36000+ $12000 = $48000 -30000=$18000
2)D. A debit to a liability
3D.
Defe
ed subscriptions revenue    16,200
Subscriptions revenue    16,200
Adjusting entry need to reflect the earned revenue.
600 *$81 = $48600 /12 = $4050 *4= =$16200
4) A. Advertising expense
5) A. $300,000
$500,000 *40/100 = $200,000 (cu
ent year tax)
$500,000 - $200,000 =$300,000
6) C. a liability account in the balance sheet
Advance revenue is a liability.
7) B. Accumulated depreciation
It has normal credit balance and it is an contra account for fixed assets.
8) A. Subscriptions collected in advance from customers.
Prepaid rent= Asset:
Depreciation = Expense
Acc. dep = Contra account for fixed asset.
So, Subscriptions collected in advance from customers is a cu
ent liability.
9) Accumulated depreciation
Balance sheet accounts are considered as permanent account, Acc.dep account not closed to retained earnings account.
10) B. Its debt to...
SOLUTION.PDF

Answer To This Question Is Available To Download

Related Questions & Answers

More Questions »

Submit New Assignment

Copy and Paste Your Assignment Here