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ACCT 1235 Assignment #1A

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ACCT 1235 Assignment #1A

    ACCT 1235 Assignment #1A (Morning) - Due October 10, 2011

    Name:_赵钰焱 __Joanna__ Student Number:__1012048____ 50 Marks ____________%

    TRUE/FALSE: Write 'T' if the statement is true and 'F' if the statement is false. (6 Marks)

1) An asset account is increased by a debit.

2) Cost of goods sold appears on both a multi-step income statement and a single-step income statement.

    3) Using the FIFO costing method will always produce the same results whether a company uses perpetual or periodic inventory.

    4) Smith borrows $10,000 on a one year Note payable that bears interest at 12% per year. He will repay the principal and interest at the end of the one-year period. Smith makes accrual adjustments and each month,

    he records interest expense of $1,200.

5) Prepaid rent is usually a long-term asset.

    6) Managerial accounting focuses on information for decision makers outside of the business, such as creditors and taxing authorities.

    MULTIPLE CHOICE: Choose the one alternative that best completes the statement or answers the question. (24

    Marks)

    7) Corporate ownership is a very popular type of ownership in the USA and Canada. Which of the following is a major reason that corporate ownership is popular?

    A) Corporate shareholders have limited liability for the debts of the corporation.

    B) The life of a corporation is limited by the death of an owner.

    C) Most corporations are small or medium-sized.

    D) A corporation is usually managed by the owners.

8) A business pays $500 cash for supplies. Which account is credited?

    A) Accounts payable B) Cash C) Supplies D) Service revenue

    9) Ending inventory for the current accounting period is understated by $2,700. What effect will this error have on Cost of goods sold and Net income?

    A) Cost of goods sold Net income

    Understated Understated

    B) Cost of goods sold Net income

    Overstated Overstated

    C) Cost of goods sold Net income

    Overstated Understated

    D) Cost of goods sold Net income

    Understated Overstated

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    10) Which of the following is a current asset that is expected to be converted to cash, sold, or consumed during the next year (or the normal operating cycle, if longer)?

    A) Equipment B) Land

    C) Accounts receivable D) Building

11) Referring to the following table, what is Operating income?

Sales revenue $460,000

    Cost of goods sold 300,000

    Operating expenses 85,000

    Sales discounts 20,000

    Sales returns and allowances 15,000

    Interest revenue 5,000

    A) $55,000 B) $160,000 C) $190,000 D) $40,000

    12) Employees of Robert Rogers, CGA worked during the last two weeks of December. They received their paychecks on January 2. The matching principle would require that which of the following accounts appear on the income statement for the year ended December 31?

    A) Salary expense B) Unearned revenue C) Prepaid expense D) Salaries payable

13) The table below represents Able Company's supplies account. Please supply the missing amount.

Beginning supplies 5,000

    Supplies purchased 6,000

    Supplies expense 8,000

    Ending supplies ?

    A) $1,000 B) $3,000 C) $11,000 D) $9,000

    14) The accountant for Jones Auto Repair Company failed to make an adjusting entry to record $5,000 of unpaid salaries for the last 2 weeks of the year. Which of the following is TRUE?

    A) Net income is overstated. B) Total assets are overstated.

    C) Total assets are understated. D) Total liabilities are overstated.

    15) A company uses the periodic inventory method. Which of the following entries would be made to record a return of $200 of inventory purchased on account?

    A) The accounting entry would be a $200 debit to Accounts payable and a $200 credit to Purchases.

    B) The accounting entry would be a $200 debit to Purchase returns and allowances and a $200 credit to

    Accounts payable.

    C) The accounting entry would be a $200 debit to Accounts payable and a $200 credit to Purchase returns

    and allowances.

    D) The accounting entry would be a $200 debit to Purchases and a $200 credit to Accounts payable.

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    16) Twenty units of inventory on hand at the end of the year are recorded at their cost of $5.00 per unit using

    FIFO. Current replacement cost is $4.50 per unit. What amount would be reported as inventory on the

    balance sheet?

    A) $5.00 B) $100.00 C) $4.50 D) $90.00

    17) A company's net sales revenue is $540,000. Its cost of goods sold is $360,000. Its gross profit percentage is:

    A) 100%. B) 300%. C) 33.33%. D) 66.67%.

18) The following is the balance sheet for Green Landscaping.

    Which of the following is the current ratio? (Round to two decimal places.)

    A) .25 B) .68 C) .97 D) 1.27

    SHORT ANSWER: Write the word or phrase that best completes each statement or answers the question. (20 Marks)

    19) On November 1, 2012, Everett Janitorial Supply sold merchandise for $5,000, FOB destination, 2/10, n/30.

    The merchandise cost $3,200. Everett paid transportation costs of $100. On November 6, 2012,

    merchandise of $1,000 from the November 1 sale was returned. The returned merchandise had cost $600.

    Everett received payment for the balance of the sale on November 10, 2012. Please provide the journal

    entry to record the receipt of payment from the customer. (2)

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    20) Henderson Sales sold 400 units of product to a customer on account. The selling price was $25 per unit, and

    the cost, according to the company's inventory records, was $12 per unit. Please provide the journal entry

    to record the Sales revenue. (2)

Henderson Sales purchased $500 of inventory on account. Please provide the journal entry. (2) 21)

    22) The following is the adjusted trial balance for Tuttle Photography.

    Account Debit Credit

     Cash $1,700

     Accounts receivable 8,500

     Supplies 100

     Equipment 7,500

    Accumulated $2,000 depreciation

     Accounts payable 1,200

     Salary payable 800

     Unearned revenue 600

     Capital 3,400

     Drawing 2,300

     Service revenue 40,000

     Salary expense 24,000

     Supplies expense 2,300

     Depreciation expense 1,600

     $48,000 $48,000

Using the information from the worksheet above, prepare the closing entry for Revenues. (2)

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    23) Below is the adjusted trial balance for Parsons Repair Service.

    Accounts Debit Credit

     Cash $1,600

     Accounts receivable 2,400

     Prepaid rent 800

     Supplies 200

     Building 14,000

     Accumulated depreciation $2,000

     Accounts payable 4,200

     Salary payable 1,000

     Unearned revenue 800

     D. Parsons, capital 6,000

     D. Parsons, drawing 1,000

     Service revenue 50,000

     Salary expense 21,000

     Rent expense 14,000

     Depreciation expense 8,500

     Supplies expense 500 Total $64,000 $64,000

     Prepare the statement of owner's equity for the year ended December 31, 2012. (4)

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    24) Please refer to the following trial balance.

     Debit Credit

     Cash $5,000

     Accounts receivable 14,000

     Inventory 20,000

     Supplies 5,000

     Land 100,000

     Accounts payable $3,000

     Notes payable 25,000

     Capital 90,000

     Drawing 1,000

     Sales revenues 160,000

     Sales returns and allowances 2,000

     Sales discounts 3,000

     Cost of goods sold 80,000

     Salary expense 5,000

     Utility expense 23,000

     Rent expense 18,000

     Interest expense 2,000

    Totals $278,000 $278,000

Prepare a multi-step income statement: (8)

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