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Quiz Questions pertaining to Chapter 9 1 . A 52 pick up was acquired for $25, 000. Excellent six-year life and a $4, 500 salvage benefit.
Using straight-line depreciation, precisely what is the asset’s carrying value (book value) after two 1/2 years? a. $8, 750. b. $12, two hundred fifty. c. $14, 583. d. $16, two hundred fifity. 2 . About January one particular, 2003, Remarkable Landscaping Business paid $17, 000 to obtain a stump grinder. If perhaps Superior uses the grinder to remove a couple of, 500 stumps per year, it will have an estimated useful your life of 10 years and a salvage benefit of $4, 500. How much depreciation charge for the year 2003, using units-of-production depreciation and assuming that 3, five-hundred stumps had been removed, is actually a. 2, 380. b. $1, 750. c. $1, seven hundred. d. $1, 250. a few. The sale for $2, 500 of equipment that cost $8, 000 and has accumulated depreciation of $6, seven hundred would cause a a. gain of $2, 000. n. gain of $700. c. loss of $700. d. decrease of $1, 300. 4. Underestimating the number of plenty of a vitamin that can be extracted over a mineral deposit’s your life will result in a. overstated net gain each year. b. overstated total assets every year. c. over-stated depletion expense each year. deb. no influence on total property each year. 5. A copyright laws is received for what turns into a very successful book.
The publisher desires the publication to generate sales for a decade. The copyright should be amortized over a. two to 4 years. n. 10 years. c. 40 years. m. the author’s life as well as 50 years. The next information pertains to the next two questions. Z Company bought an asset to get $24, 500 on January 1, 2004. The advantage was anticipated to have a four-year life and a $4, 000 salvage value. 6. The number of depreciation expense for 2006 using double-declining-balance would be a. $2, 000. b. $3, 500. c. $6, 000. d. $12, 1000. 7. Assume that Z Organization uses straight-line depreciation.
In the event on January 1, 3 years ago, Z Firm sells the asset pertaining to $10, 000, the affirmation of cash runs would record a a. $1, 1000 cash influx from gain on the sale for the property in the operating activities section. b. $10,50, 000 cash inflow by an asset convenience in the trading activities section. c. $9, 000 cash inflow by an asset convenience in the financing activities section. d. a and c. 8. In January 1, 2006, Fulsom Corporation purchased a equipment for $50, 000. Fulsom paid shipping and delivery expenses of $500 as well as installation costs of $1, 200. Fulsom estimated the equipment would have a handy life of ten years and an estimated repair value of $3, 000.
If Fulsom records depreciation using the straight-line method, depreciation expense pertaining to 2007 is usually. a. $4, 870. m. $5, 168. c. $5, 270. deb. $5, 570. 9. Hickory Ridge Company purchased terrain and a building to get $920, 000. The individual possessions were appraised at the pursuing market ideals: Land $614, 400 Building $345, 600 Recording the land inside the accounting documents would a. increase terrain by $588, 800. w. increase property by $614, 400. c. increase assets by $920, 000. d. Both a and c. 10 Cent Lane and Associates purchased a generator on January 1, 2006, for $6, 300. The generator was estimated to experience a five-year your life and a salvage worth of $600.
At the beginning of 08, the company revised the expected life with the asset to six years and modified the repair value to $300. Using straight-line devaluation, the depreciation expense noted in 08 would a. decrease possessions and value by $1, 140. n. decrease resources and collateral by $930. c. decrease assets and equity by $1, 005. d. reduce assets and equity by $1, 500. 11 Which usually of the following statements about goodwill applies? a. How much goodwill is definitely measured simply by subtracting the total amount paid for property from their good market value within the purchase date. m. The amount of goodwill is documented as a property.. Recording impairment of goodwill reduces the number of net income. d. All of the over. 12 XYZ Company paid out cash for a capital expenditure that better the functioning efficiency of 1 of its assets. Which will of the subsequent reflects just how this costs affects the company’s financial claims? a. w. c. m. 13 Possessions = +- +- , n/a Liab. n/a n/a n/a n/a + Fairness n/a n/a , n/a Rev. , n/a n/a n/a n/a Exp. n/a n/a + n/a sama dengan Net Inc. n/a n/a , n/a Cash Flow , IA n/a , OA n/a KLM Company skilled an accounting event that affected the financial claims as mentioned below: Property = , Liab. n/a Equity , Rev. , n/a Exp. + sama dengan Net Inc. , Which usually of the pursuing events could have caused these kinds of effects? a. recognizing devaluation. b. spending cash to get a capital expenditure. c. amortizing a obvious. d. non-e of the over. Cash Flow , OA 14. Which in the following appropriately matches the kind of long-term advantage with the expression used to identify how that asset’s cost is expensed? Building Oil Reserve Copyright a. Amount Depreciation Exhaustion b. Exhaustion Amortization Exhaustion c. Amount Depletion Downgrading d. Depreciation Depletion Retirement 15. Which usually of the pursuing is true?. The book value of an asset is its estimated market value. b. The principal purpose of saving depreciation expenditure on the profits statement should be to reduce tax expense. c. Recording devaluation expense lessens the book value of the asset back in it was used to produce revenue. d. The accumulated deprecation for a property provides the money needed to change the asset at the end of its useful life. Questions Questions for Chapter 10 The following data pertains to the next seven queries. On January 1, 2003, XYZ Organization issued a $5, 1000 face worth bond that sold for 80.
The bond had a five-year term and paid 10 % annual interest. The organization used the proceeds from the bond issue to buy area. The area was rented for $600 of cash earnings per year and was sold at the end of the 5th year for $4, 200 funds. 1 . The carrying benefit of the bond liability in January you, 2003, would be a. $4, 600. b. $4, 500. c. $5, 1000. d. $4, 000. installment payments on your The amount of fascination expense reported on the 2003 income statement would be a. $450. b. $400. c. $250. d. $600. 3. Fascination expense reported on the cash flow statement in the life with the bond will a. ncrease by $100 each year. n. decrease by simply $100 annually. c. become the same each year. d. equal the mentioned rate of interest. 5. The carrying value with the bond the liability on December 31, 3 years ago would be a. $4, 500. b. $5, 000. c. $4, 900. deb. $4, 600. 5. Someone buy of the arrive at December thirty-one, 2007, would a. boost retained revenue by three hundred. b. maximize equity by $4, 2 hundred. c. lessen net income by simply $300. g. have no impact on retained earnings. 6. The total amount of the liability associated with the relationship issue will a. increase each year resulting from the amortization of the lower price. b. ecrease each year due to the amount of the lower price. c. remain the same annually. d. often be equal to the eye value with the bond payable. 7. How much the cash outflow for curiosity expense in 2005 might be a. $600. n. $400. c. $500. d. $ zero. Use the pursuing information to answer the next 3 questions. In January 1, 2003, Keynes Company released a $20, 000 face value connection that sold for 110. The bond a new ten-year term and a stated interest per annum rate of 8 percent. 8. The carrying value of the relationship liability about January you, 2003, is a. $20, 1000.. $22, 500. c. $21, 800. deb. $20, 200. 9. How much interest charge reported on the company’s the year 2003 income affirmation would be a. $1, 200. w. $1, 500. c. $1, 600. d. $1, 050. 10. The amount of interest expense reported around the company’s 2005 income assertion would be a. $1, 400. n. $1, six-hundred. c. $1, 800. d. $2, 000. 11. When a bond offers at a discount, which in turn of the pursuing is true? a. The market interest at the time of concern is greater than the stated interest rate within the bond. m. The market interest rate at the time of issue is less than the stated interest rate on the bond. c.
The market interest rate at the time of issue is equivalent to the explained interest rate for the bond issue. d. The marketplace interest rate is expected to boost above the stated interest rate around the bond. doze. On January 1, the year 2003, Ink, Incorporation. borrowed hundred buck, 000 cash from the Faithfulness Bank on a note that had a 6 percent annual interest rate and a five-year term. The loan is to be repaid in annual repayments of $23, 741. 69 on January 1 annually. The amount of the January 1, 2004, repayment applied to interest and to main would be a. $6, 000 / $94, 000. b. $17, 741. 69 / $94, 000. c. $4, 935. 0 / $82, 258. 31. d. $6, 000 / $17, 741. 69. 13. Indigo Company may borrow approximately $50, 1000 on it is line of credit at the state bank. The company agrees to shell out interest month to month at two percent over prime. Funds are borrowed or repaid on the initial day of every month. Month Jan. Feb. March Sums Borrowed or (Repaid) $15, 000 money (5, 000) $30, 500 Prime Charge 6 percent 5 percent some percent The quantity of interest being accrued around the March 23 is a. $225. 00. n. $100. 00. c. $133. 33. m. $200. 00. 14. XYZ Company skilled an accounting event that affected it is financial statements as mentioned below: Possessions = Liab. + + Equity n/a Rev. , n/a Experience. n/a sama dengan Net Inc. n/a Cashflow + FA Which in the following occasions could have caused these results? a. A bond released at confront value. w. A bond issued at a discount. c. A bond given at a premium. d. All the above. 12-15. A bond will sell by a premium if perhaps: a. The industry rate of interest is usually equal to the bond’s explained rate. m. The market interest is more than the bond’s stated rate. c. Industry rate of interest is less than the bond’s stated level. d. The bond is convertible in common share. Quiz Queries for Section 11 1 .
The ZZ Corporation had the following shares of share outstanding at December 31, 2003: Prevalent Stock, $50 par worth, 40, 500 shares outstanding, and Favored Stock, 6 percent, $22.99 par worth, cumulative, 12, 000 stocks outstanding. Payouts for 2001 and 2002 were in arrears. Upon December 23, 2003, ZZ declared total cash dividends of $250, 000. The total amounts payable to preferred stockholders and common stockholders, respectively, are: a. $60, 000 / $190, 1000. b. $120, 000 as well as $130, 500. c. $125, 000 / $125, 500. d. $180, 000 as well as $70, 500. Use the pursuing information to reply to the next several questions.
The Kramer Firm was started out when it released 200 shares of $5 par worth common inventory at a market price of $20 per share. The company repurchased twelve shares by a market value of $15 per share. Later the company reissued your five shares in a market cost of 20 dollars per talk about. At the end of the first 12 months of businesses the company’s equity included $1, 200 of retained revenue in addition to its contributed capital. installment payments on your The entry to record the original concern of 200 shares of stock would a. increase cash by simply $4, 1000 / boost common stock by $4, 000. w. ncrease cash by $4, 000 as well as increase prevalent stock and paid-in capital in excess of similar value by $1, 000 and $3, 000, correspondingly. c. decrease cash by simply $4, 000 / enhance common inventory common inventory by $4, 000. d. increase cash by $1, 000 / increase prevalent stock simply by $1, 000. 3. The entry to record the purchase of the 10 shares of the company’s own share would a. decrease assets / lower equity. n. decrease possessions / boost equity. c. decrease possessions / increase treasury share. d. both equally a and c. some. What result would reissuing the five shares include on the provider’s paid-in capital from treasury stock transactions account?. Zero effect. b. Increase additional paid-in capital by hundred buck. c. Enhance additional paid-in capital by simply $25. g. Decrease additional paid-in capital by $75. 5. The exact amount of stockholders’ equity at the end of the initial year would be a. $5, one hundred and fifty. b. $5, 200. c. $1, two hundred. d. none of them of the over. 6. Which of the subsequent is an advantage of the company form of business organization? a. double taxation. b. sum of rules. c. limited liability. deb. entrenched administration. 7. January Irving started out a proprietorship on January 1, 2007 with a $1, 000 money contribution to the business.
Throughout the first 12 months of procedures the company generated $5, 000 of cash income and received $2, 000 of cash expenditures. Also, Jan withdrew $500 from the business. At the end of 2007 the balance in the Jan Irving, Capital account was a. $1, 000. b. $3, 000. c. $3, five-hundred. d. $4, 000. 8. ABC Business is approved to concern 100, 500 shares of common stock. The company issued 60, 500 shares of common share and later repurchased 15, 000 shares of its own common stock. How many shares are outstanding? a. 60, 000. n. 45, 500. c. 95, 000. deb. 40, 500. 9.
An 8 percent stock gross on doze, 000 stocks and shares of exceptional preferred share with a equiparable value of $20 every share and a market benefit of $60 a discuss will have what effect on the accounting formula? a. Enhance preferred stock by $57, 600. w. Increase funds by $38, 400. c. Decrease stored earnings by $19, 2 hundred. d. Decrease retained earnings by $57, 600. 10. Which from the following claims concerning a two-for-one share split is valid? a. The amount of shares excellent will lower. b. The marketplace price with the stock will be expected to enhance. c. You can actually equity raises. d. Simply no journal entrance would be required. 1 . EFG Company paid out cash to purchase treasury stock. Which from the following demonstrates how this affects you’re able to send financial transactions? a. b. c. g. 12. Property , +- , +- = Liab. n/a n/a n/a n/a + Fairness , n/a , n/a Rev. , n/a n/a n/a n/a Exp. n/a n/a & + = Net Incorporation. n/a n/a , , Cash Flow , FA , OA , FA , OA ZGAR Company allocated a stock gross. Which from the following displays how this affects you’re able to send financial assertions? a. b. c. deb. Assets , n/a , n/a sama dengan Liab. n/a n/a n/a n/a & Equity , +- , +- Rev. , n/a n/a n/a n/a Experience. n/a n/a + n/a = Net Inc. n/a n/a , n/a Earnings n/a n/a , FA , FA
Quiz pertaining to Chapter doze 1 . Which usually of the subsequent cash orders is labeled as an investing activity on the affirmation of cash goes? a. Money borrowed. n. Cash received from issuing stock. c. Cash received from revenue. d. Money collected on the loan. installment payments on your A building costing $55, 000 with $16, five-hundred of accumulated depreciation was sold for $40, 000. How would the cash flow from your sale display on the declaration of cash flows? a. $1, 500 in operating activities and $38, 500 in investing actions. b. $40, 000 in financing activities. c. $38, 500 non-cash financing and investing actions and $1, 500 in operating actions.. $40, 000 in investment activities. a few. The owners of Times Company put in $2, 500 in the firm. X Business used the amount to invest in Con Company. In X’s assertion of cash goes these transactions would be labeled, respectively, being a. an investing activity and an investment activity. n. a auto financing activity and a loans activity. c. an investing activity and a funding activity. m. a auto financing activity and an investment activity. 4. Issuing a note for the purchase of land is one of a. an investing activity. b. a financing activity. c. a non-cash trading and funding activity. d. transaction that will not appear on the affirmation of cash moves. 5. The sum of the three main components (operating activities, trading activities, and financing activities) on a affirmation of cash moves will add up to a. the ending cash balance. n. the enhancements made on the cash balance between the commencing and finishing of the period. c. the quantity of cash inflow for the period. d. net income for the period. Answers: Chapter 9: M, B, B, C, M, A, W, A, Deb, B, G, A, Deb, D, C Chapter 15: B, M, C, W, C, A, C, M, B, A, A, G, D, G, C Phase 11: M, B, G, C, A, C, C, B, M, D, A, B Section 12: Deb, D, D, C, M
