1. List all the steps used by Algorithm 1 to find the maximum ofthelist1,8,12,9,11,2,14,5,10,4. 2
2. Can induction, recursion and algorithm be used together and if so explain and provide an example where this could work.
3. Use strong induction to show that if you can run one mile or two miles, and if you can always run two more miles once you have run a specified number of miles, then you can run any number of miles.
4. Use strong induction to show that all dominoes fall in an infinite arrangement of dominoes if you know that the first three dominoes fall, and that when a domino falls, the domino three farther down in the arrangement also falls.
1) A capital expenditure
A. is expensed immediately.
B. is a credit like capital (owners’ equity).
C. adds to an asset.
D. records additional capital.
2) At the beginning of last year, Brentwood Corporation purchased a piece of heavy equipment for $ 88,000. The equipment has a life of five years or 100,000 hours. The estimated residual value is $ 8,000. Bremond used the equipment for 19,000 hours last year and 22,000 hours this year. Depreciation expense for year two using double-declining-balance (DDB) and units-of-production (UOP) methods would be as follows:
(Carry all rates to two decimal places, XX)
A) $19,200 $19,360
B) $19,200 $17,600
C) $21,120 $19,360
D) $21,120 $17,600
3) Hamilton Company purchased a machine for $ 11,800 on January 1, 2016. The machine has been depreciated using the straight-line method over a four-year life with a $ 1 comma 600 residual value. Hamilton sold the machine on January 1, 2018, for $ 8 comma 000. The book value as of December 31, 2017 is $ 6 comma 700. What gain or loss should Hamilton record on the sale?
A. Gain, $ 2 comma 200
B. Gain, $ 1 comma 300
C. Loss, $ 1 comma 300
D. Loss, $ 1 comma 250
4) Suppose AmerEx pays $ 72 million to buy Lone Star Overnight. The fair value of Lone Star’s
assets is $ 86 million, and the fair value of its liabilities is $ 21million. How much goodwill did
AmerEx purchase in its acquisition of Lone Star Overnight?
A. $ 7 million
B. $ 21Million
C. $ 51 million
D. $ 35 million
5) Which of the following costs are reported on a company’s income statement and balance sheet?
Income Statement Balance Sheet
A. Cost of Goods sold Accumulated depreciation
B. Accumulated depreciation Land
C. Goodwill Accounts payable
D. Gain on sale of land Cost of goods sold
6) Kline Company failed to record depreciation of equipment. How does this omission affect
Kline’s financial statements?
A. Net income is understated and assets are overstated.
B. Net income is overstated and assets are understated.
C. Net income is understated and assets are understated.
D. Net income is overstated and assets are overstated.
7) Acton, Inc., uses the double-declining-balance method for depreciation on its computers. Which item is not needed to compute depreciation for the first year?
A. Estimated residual value
B. Expected useful life in years
C. Original cost
D. All the items listed are needed.
8) Hamilton Company purchased a machine for $ 11 comma 800 on January 1, 2016.
The machine has been depreciated using the straight-line method over a four-year
life with a $ 1 comma 600 residual value. Hamilton sold the machine on January 1, 2018,
for $ 8 comma 000. What is straight-line depreciation for the year ended December 31, 2016, and what is the book value on December 31, 2017?
What is straight-line depreciation for the year ended December 31, 2016?
The depreciation is $____________
What is the book value on December 31, 2017?
The book value is $_____________
9) Harper, Inc., was reviewing its assets for impairment at the end of the current year. Information about one of its assets is as follows:
|Net book value . . . . . . . . . . . . . . . .||$900,000|
|Estimated future cash flows . . . . . .||$670,000|
|Fair (market) value . . . . . . . . . . . . .||$645,000|
Harper should report an impairment loss for the current year of
A. $ 0
B. $ 230,000
C. $ 25,000
D. $ 255,000
10) Data World, Inc., reported sales revenue of $ 480,000, net income of $ 36,000, and average total assets of $ 300,000. Data World’s return on assets is
11) For the purpose of classifying liabilities as current or noncurrent, the term operating cycle refers to
A. the time period between the date of sale is made and the date the related revenue is collected.
B. the average time
C. the time period between the purchase of merchandise and the conversion of this merchandise back to cash.
D. a period of one year.
12) What kind of account is Unearned Revenue?
A. Asset account
B. Revenue account
C. Expense account
D. Liability account
13) A bond with a face amount of $17,000 has a current price quote of 103.85.
What is the bond’s price?
A. $ 17,103.85
B. $ 176,545
C. $ 1,765.45
D. $ 17,654.50
14) Is the payment of the face amount of a bond on its maturity date regarded as an operating activity, an investing activity, or a financing activity?
A. Operating activity
B. Investing activity
C. Financing activity
15) What type of account is Discount on Bonds Payable, and what is its normal balance?
A. Contra liability; Credit
B. Adjusting account; Credit
C. Contra liability; Debit
D. Reversing account; Debit
16) Failure to accrue interest expense results in
A. an overstatement of net income and an understatement of liabilities.
B. an overstatement of net income and an overstatement of liabilities.
C. an understatement of net income and an overstatement of liabilities.
D. an understatement of net income and an understatement of liabilities.
17) An end-of-period adjusting entry that debits Unearned Revenue most likely will credit
A. an asset.
B. a liability.
C. a revenue.
D. an expense.
18) McIntosh Corporation issued $ 100,000 of 12%, 20-year bonds payable on January 1, 2016.
The market interest rate when the bonds were issued was 13%. Interest is paid semiannually on January 1 and July 1. The first interest payment is July 1, 2016. McIntosh recorded interest expense of $ 6,040 using the effective-interest amortization method. McIntosh’s entry to record the interest expense on July 1, 2016, will include a
A. credit to Interest Expense.
B. debit to Bonds Payable.
C. credit to Discount on Bonds Payable.
D. debit to Premium on Bonds Payable.
19) Amortizing the discount on bonds payable
A. reduces the semiannual cash payment for interest.
B. is necessary only if the bonds were issued at more than face value.
C. increases the recorded amount of interest expense.
D. reduces the carrying value of the bond liability.
20) The journal entry on the maturity date to record the payment of $ 2,500,000
of bonds payable that were issued at a $ 90,000 discount includes
A. a debit to Discount on Bonds Payable for $ 90,000.
B. a debit to Bonds Payable for $ 2 comma 500,000.
C. a credit to Cash for $ 2 comma 590,000.
D. all of the above.