Project #45409 - Accounting

Question 1

An aging of a company's accounts receivable indicates that $14,000 are estimated to be uncollectible. If Allowance for Doubtful Accounts has a $1,100 credit balance, the adjustment to record bad debts for the period will require a


credit to Allowance for Doubtful Accounts for $14,000.

debit to Bad Debt Expense for $12,900.

 

Question 2

A company has net credit sales of $750,000 for the year and it estimates that uncollectible accounts will be 2% of sales. If Allowance for Doubtful Accounts has a credit balance of $2,000 prior to adjustment, its balance after adjustment will be a credit of


$15,040.

$13,000.

$15,000.

$17,000.

 

Question 3

The maturity value of a $50,000, 9%, 60-day note receivable dated July 3 is


$59,000.

$50,750.

$50,000.

 

uestion 4

Reck Company receives a $15,000, 3-month, 8% promissory note from Fey Company in settlement of an open accounts receivable. What entry will Reck Company make upon receiving the note?


Notes Receivable   15,000    
Interest Receivable   300    
  Accounts Receivable—Fey Company       15,000
  Interest Revenue       300

Notes Receivable   15,000    
  Accounts Receivable—Fey Company       15,000

Notes Receivable   15,300    
  Accounts Receivable—Fey Company       15,000
  Interest Revenue       300

Notes Receivable   15,300    
  Accounts Receivable—Fey Company       15,300

 

Question 5

Gagner Clinic purchases land for $175,000 cash. The clinic assumes $1,500 in property taxes due on the land. The title and attorney fees totaled $1,000. The clinic has the land graded for $2,200. What amount does Gagner Clinic record as the cost for the land?


$157,200

$175,000

$179,700

$157,500

 

Question 6

Carey Company buys land for $50,000 on 12/31/13. As of 3/31/14, the land has appreciated in value to $50,700. On 12/31/14, the land has an appraised value of $51,800. By what amount should the Land account be increased in 2014?


$1,100

$0

$1,800

$700

 

Question 7

Engler Company purchases a new delivery truck for $55,000. The sales taxes are $4,000. The logo of the company is painted on the side of the truck for $1,600. The truck license is $160. The truck undergoes safety testing for $290. What does Engler record as the cost of the new truck?


$60,890

$61,050

$59,000

$60,600

 

Question 8

A company purchased factory equipment on April 1, 2014 for $160,000. It is estimated that the equipment will have a $20,000 salvage value at the end of its 10-year useful life. Using the straight-line method of depreciation, the amount to be recorded as depreciation expense at December 31, 2014 is


$12,000.

$16,000.

$14,000.

$10,500.

 

Question 9

A factory machine was purchased for $375,000 on January 1, 2014. It was estimated that it would have a $75,000 salvage value at the end of its 5-year useful life. It was also estimated that the machine would be run 40,000 hours in the 5 years. The company ran the machine for 4,000 actual hours in 2014. If the company uses the units-of-activity method of depreciation, the amount of depreciation expense for 2014 would be


$60,000.

$37,500.

$30,000.

$75,000.

 

Question 10

Farr Company purchased a new van for floral deliveries on January 1, 2014. The van cost $56,000 with an estimated life of 5 years and $14,000 salvage value at the end of its useful life. The double-declining-balance method of depreciation will be used. What is the balance of the Accumulated Depreciation account at the end of 2015?


$35,840

$13,440

$26,880

$8,960

 

   
 

Problem 11-3A

Mann Hardware has four employees who are paid on an hourly basis plus time-and-a-half for all hours worked in excess of 40 a week. Payroll data for the week ended March 15, 2014, are presented below.

Employee
 
Hours Worked
 
Hourly Rate
 
Federal Income Tax Withholdings
 
United Fund
Ben Abel   40   $15   $?     $5  
Rita Hager   42   16   ?     5  
Jack Never   44   13   60     8  
Sue Perez   46   13   61     5  

Abel and Hager are married. They claim 0 and 4 withholding allowances, respectively. The following tax rates are applicable: FICA 7.65%, state income taxes 3%, state unemployment taxes 5.4%, and federal unemployment 0.8%.
 
Prepare a payroll register for the weekly payroll. (Use the wage-bracket withholding table in the text for federal income tax withholdings.) (Round answers to 2 decimal places, e.g. 15.25.)

MANN HARDWARE
Payroll Register
For the Week Ending March 15, 2014
   
Earnings
 
Deductions
       
Employee
 
Hours
 
Regular
 
Overtime
 
Gross Pay
 
FICA
 
Federal Income Tax
 
State Income Tax
 
United Fund
 
Total
 
Net Pay
 
Salaries and Wages Expense
Ben Abel   40  
$
 
$
 
$
 
$
 
$
 
$
 
$
 
$
 
$
 
$
Rita Hager   42  
 
 
 
 
 
 
$
 
 
 
Jack Never   44  
 
 
 
 
 
 
$
 
 
 
Sue Perez   46  
 
 
 
 
 
 
$
 
 
 
Totals
     
 
 
 
 
 
 
 
 
 
 

Journalize the payroll on March 15, 2014, and the accrual of employer payroll taxes. (Round answers to 2 decimal places, e.g. 15.25. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date
Account Titles and Explanation
Debit
Credit
Mar. 15
 
 
 
 
 
 
(To record payroll)
   
Mar. 15
 
 
 
 
(To record accrual of payroll taxes.)
   
 

 
Journalize the payment of the payroll on March 16, 2014. (Round answers to 2 decimal places, e.g. 15.25. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Date
Account Titles and Explanation
Debit
Credit
Mar. 16
 
 

Journalize the deposit in a Federal Reserve bank on March 31, 2014, of the FICA and federal income taxes payable to the government. (Round answers to 2 decimal places, e.g. 15.25. Credit account titles are automatically indented when amount is entered. Do not indent manually.)

Account Titles and Explanation
Debit
Credit
   
 

Problem 12-2A

At the end of its first year of operations on December 31, 2014, NBS Company’s accounts show the following.

Partner
 
Drawings
 
Capital
Art Niensted   $23,000   $48,000
Greg Bolen   14,000   30,000
Krista Sayler   10,000   25,000

The capital balance represents each partner’s initial capital investment. Therefore, net income or net loss for 2014 has not been closed to the partners’ capital accounts.
 
Journalize the entry to record the division of net income for the year 2014 under each of the following independent assumptions. (Credit account titles are automatically indented when amount is entered. Do not indent manually.)

(1)   Net income is $30,000. Income is shared 6 : 3 : 1.
(2)   Net income is $40,000. Niensted and Bolen are given salary allowances of $15,000 and $10,000, respectively. The remainder is shared equally.
(3)   Net income is $19,000. Each partner is allowed interest of 10% on beginning capital balances. Niensted is given a $15,000 salary allowance. The remainder is shared equally.

No.
Account Titles and Explanation
Debit
Credit
1.
 
 
 
2.
 
 
 
3.
 
 
 
 

Prepare a schedule showing the division of net income under assumption (3) above. (If an amount reduces the account balance then enter with a negative sign preceding the number or parenthesis, e.g. -15,000, (15,000).)

DIVISION OF NET INCOME
   
Art Niensted
 
Greg Bolen
 
Krista Sayler
 
Total
Salary allowance  
$
 
 
 
$
Interest allowance on capital  
 
 
 
Total salaries and interest  
 
 
 
Remaining deficiency  
 
 
 
Total division of net income  
$
 
$
 
$
 
$
 

Prepare a partners’ capital statement for the year under assumption (3) above. (List items that increase partners capital first.)

NBS COMPANY
Partners’ Capital Statement
For the Year Ended December 31, 2014
 
Art Niensted
Greg Bolen
Krista Sayler
Total
$
$
$
$
 
$
$
$
$

Subject Business
Due By (Pacific Time) 10/29/2014 11:30 pm
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