Reference no: EM132331400

Question

1. Equipment purchased on January 3,2018 for $80,000 was depreciated using the straight-line method based upon a 5-year life and $7,500 residual value. The equipment was sold on December 31,2020 for $40,000. What is the gain on the sale of the equipment? urchased on January 3, 2018, for $80,000 was depreciated using the straight-line

a. $3,500

b. $14,500

c. $36,500

d. $43,500

2. The bank erroneously charged Tropical Services' account for $450.50 for a check that was oprecty written and recorded by Tropical Services as $540.50. To reconcile the bank account Tropical Services at the end of the month, you would:

a. Add $90 to the cash balance according to the bank statement.

b. Add $90 to the cash balance according to Tropical educt $90 from the cash balance according to the bank statement.

c. Deduct $90 from the cash balance according to Tropical Serv I Services r records.

d.records

3. Journal entries based on the bank reconciliation are required for

a. Additions to the cash balance according to the company's records.

b. Deductions from the cash balance according to the company's records

c. Both A and B

d. Neither A nor B

4. If common stock is issued for an amount greater than par value, the excess should be credited to

a. Cash.

b. Retained Earnings

c. Paid-in Capital in Excess of Par Value

d. Legal Capital.

5. Treasury stock is

a. stock issued by the U.S. Treasury Department.

b. stock purchased by a corporation and held as an investment in its treasury.

c. corporate stock issued by the treasurer of a company.

d. a corporation's own stock which has been reacquired but not canceled.

6. Common Stock Dividends Distributable is classified as a(n)

a. asset account.

b. expense account.

c. liability account.

d. stockholders' equity account.

7. Regular dividends are declared out of

a. Paid-in Capital in Excess of Par Value.

b. Treasury Stock.

c. Common Stock.

d. Retained Earnings.

8. Which of the followving is not a significant date with respect to dividends?

a. The declaration date

b. The incorporation date

c. The record date

d. The payment date