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Question (Category: Business Accounting )
PennFoster University - 061695RR - THE VALUE OF MONEY NEW !!! - 100% Correct Guarantee - LATEST PennFoster University - 061695RR - THE VALUE OF MONEY NEW !!! - 100% Correct Guarantee - LATEST Exam 061695RR - THE VALUE OF MONEY When you have completed your exam and reviewed your answers, click Submit Exam. Answers will not be recorded until you hit Submit Exam. If you need to exit before completing the exam, click Cancel Exam. Questions 1 to 20 Select the best answer to each question. Note that a question and its answers may be split across a page break, so be sure that you have seen the entire question and all the answers before choosing an answer. 1. Casey Companys bank statement shows a bank balance of $43,267. The statement shows a bank service charge of $50. Caseys book balance shows outstanding checks of $5,288 and deposits in transit of $9,325. The bank-side reconciliation would show cash of A. $43,267. B. $43,217. C. $,230. D. $47,304. 2. Which of the following would be considered a cash equivalent? A. Currency B. Time deposits C. Money orders D. Checks 3. 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 B. $354.38 C. $315.00 D. $38.84 4. Research and development costs (RampD) are generally A. expensed and become part of the income statement. B. listed as quotother intangiblesquot on the balance sheet. C. listed as quotlong-term assetsquot on the balance sheet. D. listed as quotcurrent assetsquot on the balance sheet. 5. 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 6. Which of the following would be considered a contingent liability? A. Sales tax obligation B. Mortgage obligation C. Pending legal action D. Accounts payable obligation 7. A $400,000 issue of bonds that sold for $363,000 matures on August 1, 2015. The journal entry to record the payment of the bond on the maturity date is A. debit bonds payable, $363,000 credit cash, $363,000. B. debit bonds payable, $400,000 credit cash, $400,000. C. debit cash, $363,000 credit bonds payable, $363,000. D. debit cash, $400,000 credit bonds payable, $400,000. 8. 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. $72,000. B. $50,000. C. $83,300. D. $29,167. 9. A patent has amortization this year of $2,300. The journal entry would be A. debit Amortization ExpensemdashPatent, $2,300 credit Patent, $2,300. B. debit Amortization ExpensemdashPatent, $2,300 credit Accumulated DepreciationmdashPatent, $2,300. C. debit Accumulated AmortizationmdashPatent, $2,300 credit Patent, $2,300. D. debit Accumulated AmortizationmdashPatent, $2,300 credit Amortization ExpensemdashPatent, $2,300. 10. 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. 29.2%. B. 41.2%. C. 70.8%. D. 17.1%. 11. Cash equivalents are A. not liquid and carry little risk. B. not liquid and carry high risk. C. very liquid and carry high risk. D. very liquid and carry little risk. 12. A warranty is an example of aan _______ liability. A. settled B. contingent C. known D. estimated 13. Taylor Company has given you the following information from its aging of accounts receivable. The current amount in the allowance for doubtful accounts is a $958 credit. Using this information, what is the amount of the journal entry to record the allowance for doubtful accounts? Current $24,400 2% uncollectible 31ndash60 days 7,350 8% uncollectible 61ndash90 days 3,380 15% uncollectible 91 and up 1,220 30% uncollectible A. $1,949 B. $541 C. $991 D. $2,457 14. Which of the following would not be a liability according to FASBs definition of a liability? A. An obligation thats estimated in amount B. An obligation to provide goods or services in the future C. The signing of a three-year employment contract at a fixed annual salary D. A note payable with no specified maturity date 15. By not accruing warranty expense, A. reported expenses will be overstated, and reported liabilities 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 understated, and net income will be understated. 16. Which of the following would indicate poor internal control over accounts receivable? A. The same person handling cash receipts also records the accounts receivable transactions. B. The mailroom employees open the mail and give the cash receipts to another employee. C. The person handling cash receipts passes the receipts to someone who enters them into accounts receivable. D. The person who handles accounts receivable wouldnt write off accounts as uncollectable. 17. Meranda Corporation purchases a machine for $125,000. It has an estimated salvage value of $10,000 and is expected to produce 50,000 units in its lifetime. During the first year of operation, it produced 14,500 units. To the nearest dollar, the depreciation for the first year under the units of production method will be A. $33,350. B. $36,250. C. $31,250. D. $35,500. 18. Which of the following would not be considered a contingent liability? A. Cosigning a loan B. Mortgage payable C. Potential fines from the EPA D. Pending legal action 19. Nick Company has cash of $33,000 net accounts receivable of $41,000 short-term investments of $15,000 and inventory of $25,000. It also has $30,000 in current liabilities and $50,000 in long-term liabilities. The quick ratio for Nick Company is A. 1.78. B. 3.80. C. 3.30. D. 2.97. 20. A company purchased furniture on January 1, 2012. Its cost was $15,600, and it had a residual value of $1,600. Its useful life is determined to be three years. Using double-declining balance depreciation, the depreciation for 2012 to the nearest dollar will be A. $4,667. B. $9,333. C. $5,200. D. $10,400.


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