Discount on Notes Payable should be classified as a
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Wednesday 31 October 2012
Discount on Notes Payable should be classified as a Answer current asset contra account to Notes Payable part of stockholders' equity deferred debit
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On December 1, 2010, Young Co. borrowed money at the bank by signing a 90-day non-interest-bearing note for $24,000 that was discounted at 8%. Which of the following entries is correct? Answer March 1, 2011 Note Payable 23,520 Cash 23,520 December 31, 2010 Interest Expense 160 Interest Payable 160 December 1, 2010 Cash 24,000 Note Payable 24,000 December 31, 2010 Interest Expense 160 Discount on Notes Payable 160
On December 1, 2010, Young Co. borrowed money at the bank by signing a 90-day non-interest-bearing note for $24,000 that was discounted at 8%. Which of the following entries is correct?
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The Pecan Street Ice Cream Company discovers that depreciation expense was overstated last year. How should this discovery be reported in the current year? Answer as a reduction in the current year's depreciation expense as an increase to the retained earnings beginning balance as a miscellaneous item in the Other Revenue/Expense section of the income statement as a footnote only to the current year's financial statements
The Pecan Street Ice Cream Company discovers that depreciation expense was overstated last year. How should this discovery be reported in the current year?
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An impairment loss must be recognized when an asset's Answer book value is lower than its fair value book value is higher than its fair value present value is lower than its fair value present value is higher than its fair value
An impairment loss must be recognized when an asset's
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Battle Co. purchased a new truck for $36,000 on June 1, 2010, with a useful life of eight years and a residual value of $4,800. If the company used double-declining-balance depreciation computed to the nearest whole year, depreciation expense for 2011 was Answer $6,750.00 $7,687.50 $5,250.00 $5,850.00
Battle Co. purchased a new truck for $36,000 on June 1, 2010, with a useful life of eight years and a residual value of $4,800. If the company used double-declining-balance depreciation computed to the nearest whole year, depreciation expense for 2011 was
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Tuesday 30 October 2012
On January 1, 2010, Montana Co. purchased five machines at a price of $10,000 per machine. Because the estimated life was five years and no salvage value was expected, a group depreciation rate of 20% was used. On January 1, 2012, one of the machines was sold for $5,000. The correct entry to record the sale of the machine is
On January 1, 2010, Montana Co. purchased five machines at a price of $10,000 per machine. Because the estimated life was five years and no salvage value was expected, a group depreciation rate of 20% was used. On January 1, 2012, one of the machines was sold for $5,000. The correct entry to record the sale of the machine is
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Cash 5,000 Loss on Sale of Machine 1,000 Accumulated Depreciation 4,000 Machines 10,000 |
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On January 1, 2010, Frommer, Inc. purchased an asset for $32,000. It was estimated that the asset life was seven years, after which it would have a residual value of $2,100. Assuming the use of the sum-of-the-years'-digits method, depreciation expense for 2010 would be Answer $4,271 $7,475 $8,000 $8,543
On January 1, 2010, Frommer, Inc. purchased an asset for $32,000. It was estimated that the asset life was seven years, after which it would have a residual value of $2,100. Assuming the use of the sum-of-the-years'-digits method, depreciation expense for 2010 would be
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Worth Manufacturing Company purchased a new production machine on July 1, 2010, for $140,000. The estimated salvage value is $10,000. The company uses units-of-production depreciation and estimates the machine will produce 100,000 units during its useful life. In 2010, the company manufactured 5,000 units after acquiring the machine. Depreciation expense for 2010 will be
Worth Manufacturing Company purchased a new production machine on July 1, 2010, for $140,000. The estimated salvage value is $10,000. The company uses units-of-production depreciation and estimates the machine will produce 100,000 units during its useful life. In 2010, the company manufactured 5,000 units after acquiring the machine. Depreciation expense for 2010 will be
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On January 1, 2010, Ringo purchased, for $100,000, equipment having a useful life of eight years and an estimated salvage value of $4,000. Ringo has recorded monthly depreciation on the equipment using the straight-line method. On March 1, 2015, the equipment was sold for $46,000. As a result of this sale, Ringo should recognize Answer no gain or loss an $8,000 gain an $8,000 loss a $12,000 gain
On January 1, 2010, Ringo purchased, for $100,000, equipment having a useful life of eight years and an estimated salvage value of $4,000. Ringo has recorded monthly depreciation on the equipment using the straight-line method. On March 1, 2015, the equipment was sold for $46,000. As a result of this sale, Ringo should recognize
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During 2011, Ruby Corporation purchased three pieces of equipment at an auction for the lump sum of $200,000. It cost Ruby $20,000 to have the equipment delivered and installed. The equipment was appraised at the following values: Machine 1 $120,000 Machine 2 105,000 Machine 3 75,000 Machine 2 should be recorded on Ruby's books at Answer $105,000 $120,000 $ 77,000 $ 70,000
During 2011, Ruby Corporation purchased three pieces of equipment at an auction for the lump sum of $200,000. It cost Ruby $20,000 to have the equipment delivered and installed. The equipment was appraised at the following values:
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$120,000 |
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105,000 |
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75,000 |
Machine 2 should be recorded on Ruby's books at
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Rally Company exchanged a piece of equipment with a fair market value of $20,000 and a book value of $25,000 for a truck with a fair market value of $16,000 and cash of $4,000. Ralley Company should record the truck at a cost of Answer $15,000 and a recognized loss of $5,000 $16,000 and a recognized loss of $5,000 $20,000 and a recognized loss of $5,000 $20,000 and a recognized loss of $1,000
Rally Company exchanged a piece of equipment with a fair market value of $20,000 and a book value of $25,000 for a truck with a fair market value of $16,000 and cash of $4,000. Ralley Company should record the truck at a cost of
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