50.1K

Verified Solution

Link Copied!

On October 1, Laura Corp. borrowed $140,000 from the HSC Bank for five months at 9%. Interest is due at maturity. The company's year-end is December 31, at which time any outstanding interest was accrued. The entry to record payment of the note and accrued interest on March 1, the due date, is

	1) Dr. Notes Payable 140,000, Dr. Interest Payable 3,150, Cr. Cash 143,150
	2) Dr. Notes Payable 140,000, Dr. Interest Expense 3,150, Dr. Interest Payable 2,100, Cr. Cash 145,250
	3) Dr. Notes Payable 14,250, Cr. Cash 145,250
	4) Dr. Notes Payable 140,000, Dr. Interest Payable 3,150, Dr. Interest Expense 2,100, Cr. Cash 145,250

On October 1, 2019, Jason Co. paid $2,400 for a two-year insurance policy on its building, effective on Oct 1, 2019. Jason Co.'s fiscal year ends on December 31. Which amounts should the company report for Prepaid Insurance and Insurance Expense on its financial statements for 2019?

	1) Prepaid insurance: $2,200; Insurance expense: $200
	2) Prepaid insurance: $2,400; Insurance expense: $0
	3) Prepaid insurance: $2,100; Insurance expense: $300
	4) Prepaid insurance: $300; Insurance expense: $2,100

On January 1, 2018, Bethany Corporation reported $3,000,000 in its Common Shares account (200,000 issued) and retained earnings of $1,000,000. During 2018, the following events occurred: 1. On July 1, the company issued 100,000 common shares at $17 per share. 2. December 15, the board of directors declared a 15% stock dividend to common shareholders of record on December 31, payable on January 15, 2019. 3. The market value of Blue Corporation common shares was $16 per share on December 15 and $14 per share on December 31. 4. Net income for 2018 was $625,000.

The total shareholders' equity at Dec 31, 2018 is:

	1) $6,325,000
	2) $6,420,000
	3) $5,420,000
	4) $5,605,000

An adjusting entry to adjust a company's reported cash balance is needed if:

	1) a notice of abank service charge is received along with the bank statement.
	2) a cheque made to a supplier has not yet been cleared by its bank.
	3) a deposit was in transit at the end of the period.
	4) its bank has incorrectly recorded a cheque in the company's bank account.

\

On December 1, 2019, Aidan Co. purchased a tract of land as a factory site for $780,000. The old building on the property was razed, and salvaged materials resulting from demolition were sold. Additional costs incurred and salvage proceeds realized during December 2019 were as follows:

Cost to remove old building	$70,000
Legal fees for purchases contract and to record ownership	10,000
Title guarantee insurance	16,000
Proceeds from sale of salvaged materials	10,000

In Aidan Co. 's December 31, 2019 balance sheet, what amount should be reported as land?

\

	1) $868,000.00
	2) $886,000.00
	3) $866,000.00
	4) $842,000.00

Which of the following would never affect a companys profit margin?

	1) dividends declared
	2) depreciation expense
	3) sales returns
	4) income tax expense

Answer & Explanation Solved by verified expert

See Answer