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Q12

A company bought new heating system for $50,000 and was given a trade-in of $2100 on an old heating system, so the company paid $47,900 cash with the trade-in. The old system had an original cost of $44,500 and accumulated depreciation of $40,900. If the transaction has commercial substance, the company should record the new heating system at:

		$2100.
		$50,000.
		$51,500.
		$3600.
		$47,900. The following information is taken from Reagan Company's December 31 balance sheet: Cash and cash equivalents $ 10,019 Accounts receivable 78,422 Merchandise inventories 68,362 Prepaid expenses 5700 Accounts payable $ 16,550 Notes payable 94,638 Other current liabilities 11,100 If net sales for the current year were $603,500, the firm's days' sales uncollected for the year is: (Use 365 days a year.) 47.4 days 41.3 days 69.5 days 159.4 days 79.7 days Q23 On April 12, Hong Company agrees to accept a 60-day, 10%, $5400 note from Indigo Company to extend the due date on an overdue accounts payable. What is the journal entry needed to record the transaction by Indigo Company? Debit Accounts Receivable $5400; credit Notes Payable $5400. Debit Cash $5400; credit Notes Payable $5400. Debit Notes Payable $5400; credit Accounts Payable $5400. Debit Sales $5400; credit Notes Payable $5400. Debit Accounts Payable $5400; credit Notes Payable $5400. A company had net sales of $30,300 and ending accounts receivable of $3900 for the current period. Its days' sales uncollected equals: (Use 365 days a year.) 38.98 days. 46.98 days. 7.77 days. 62.28 days. 58.18 days. Athena Company provides employee health insurance that costs $14,100 per month. In addition, the company contributes an amount equal to 4% of the employees' $141,000 gross salary to a retirement program. The entry to record the accrued benefits for the month would include a: Debit to Employee Benefits Expense $19,740. Debit to Employee Retirement Program Payable $5640. Debit to Medical Insurance Payable $14,100. Credit to Employee Benefits Expense $14,100. Debit to Payroll Taxes Expense $19,740.

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