PART 2 :
QUESTIONS : Q26 TO Q50 :
In the process of reconciling Marks Enterprises’ bank statement for September, Mr. Marks compiles the following information:
Cash balance per company books on September 30$ 6,270
Deposits in transit at month-end$ 1,310
Outstanding checks at month-end$ 630
Bank charge for printing new checks $ 50
Note receivable and interest collected by bank on Marks’ behalf $ 760
A check given to Marks during the month by a customer is returned
by the bank as NSF$ 490
The adjusted cash balance per the books on September 30 is:
On December 31 of the current year, a company’s unadjusted trial balance included the following: Accounts Receivable, debit balance of $97,900; Allowance for Doubtful Accounts, credit balance of $1,031. What amount should be debited to Bad Debts Expense, assuming 6% of outstanding accounts receivable at the end of the current year will be uncollectible?
A company has $102,000 in outstanding accounts receivable and it uses the allowance method to account for uncollectible accounts. Experience suggests that 6% of outstanding receivables are uncollectible. The current debit balance (before adjustments) in the allowance for doubtful accounts is $920. The journal entry to record the adjustment to the allowance account includes a debit to Bad Debts Expense for:
None of these
A company that uses the net method of recording invoices made a purchase of $900 with terms of 3/10, n/30. The entry to record the purchase would include:
A credit to Cash for $873.
A debit to Cash for $873.
A credit to Discounts Lost for $27.
A debit to Merchandise Inventory for $873.
A debit to Discounts Lost for $27.
The interest accrued on $5,500 at 8% for 45 days is (Use 360 days a year. Do not round intermediate calculations):
Marble Company purchased a machine costing $134,000, terms 3/10, n/30. The machine was shipped FOB shipping point and freight charges were $3,400. The machine requires special mounting and wiring connections costing $11,400. When installing the machine, $2,700 in damages occurred. Materials costing $2,900 are used in testing and adjusting the machine to produce a satisfactory product. Compute the cost recorded for this machine assuming Marble paid within the discount period.
An employee earned $45,600 during the year working for an employer. The FICA tax rate for Social Security is 6.2% and the FICA tax rate for Medicare is 1.45%. The employee’s annual FICA taxes amount is:
Zero, since the employee’s pay exceeds the FICA limit.
|During August, Arena Company sells $363,000 in product that has a one year warranty. Experience shows that warranty expenses average about 4% of the selling price. The warranty liability account has a balance of $13,500 before adjustment. Customers returned product for warranty repairs during the month that used $10,100 in parts for repairs. The entry to record the customer warranty repairs is:|
|Debit Estimated Warranty Liability $10,100; credit Parts Inventory $10,100.|
|Debit Warranty Expense $14,520; credit Estimated Warranty Liability $14,520.|
|Debit Estimated Warranty Liability $14,520; credit Parts Inventory $14,520.|
|Debit Warranty Expense $10,100; credit Estimated Warranty Liability $10,100.|
|Debit Warranty Expense $11,120; credit Estimated Warranty Liability $11,120.