Reference no: EM132593571

Questions -

Q1. Towson Corp., was organized on January 2, 2018. During the first year of operation, Towson issued 90,000 shares of $6 par value common stock at a price of $35 cash per share. On December 31, 2018, Towson reported Net Income of $250,000 and paid $50,000 cash dividends. Use this information to determine the dollar amounts that Towson will report on its year end Balance Sheet for Paid in Capital Common Stock in Excess of par.

Q2. Towson Corp., had 6,000 shares of $100 par, 5% cumulative preferred stock as of January 1, 2018. No additional shares of preferred stock were issued during fiscal years 2018 & 2019. Dividends were paid to common shareholders in 2017 but no shareholders were paid dividends in 2018. A total of $90,000 of dividends was paid in 2019. Use this information to determine the total dollar amount of dividends that was paid to common shareholders during fiscal year 2019.

Q3. On January 2, 2018, the first year of operations, Brunswick Corp. issued 15,000 shares of $10 par value common stock for $15 per share. On July 1, 2018, 2,000 of these shares were reacquired for $19 each (this is Treasury Stock). On September 1, 2018 Brunswick Corp. reissued 1,000 shares of its treasury stock for $21 per share. No other stock transactions occurred during the rest of fiscal year 2018. Use this information to determine the dollar amount that Brunswick will report on its fiscal year 2018 Balance Sheet for Paid in Capital Treasury Stock.

Q4. On August 1, 2018, Towson Corp., declared a 5% stock dividend on its common stock when the market value of the common stock was $20 per share. The balance in the common stock account, before the stock dividend was declared, was $1,100,000. The par value of all common stock is $10. What is the total dollar amount credited to additional paid in capital - common stock on August 1, 2018?

Q5. Easton Company prepares annual adjusting entries only. During the third quarter of Fiscal Year 2018, Easton Company acquired the following trading securities:

Date Company # of Shares Price per Share

8/15 X Company 1,500 $50

9/25 Y Company 1,250 30

9/30 Z Company 1,000 24

On November 10th, Easton Company sold the Y Company stock for $31 per share. On December 15th, Z Company paid dividends of $0.12 per share. The following were the year-end market values:

Company FMV per Share

X Company $43

Y Company 15

Z Company 31

What the total dollar values that Easton Company should record for the Unrealized Gain or (Loss) on Trading Securities for 2018? Enter a Loss as a negative number.

Q6. Arundel Company uses aging to estimate uncollectibles. At the end of the fiscal year, December 31, 2018, Accounts Receivable has a balance that consists of:

Dollar Value Age of Account Estimated Collectible

$215,000 < 30 days old 99.0%

70,000 30 to 60 days old 90.5%

40,000 61 to 120 days old 79.0%

15,000 > 120 days old 13.0%

The current unadjusted Allowance for Uncollectible Accounts balance is a debit balance of $2,000 and the Bad Debt Expense accounts has an unadjusted balance of zero. After the adjusting entry is made, what will be the dollar balances in the Allowance for Doubtful Accounts? Round to nearest whole dollar.

Q7. Arundel Company uses percentage of sales to estimate uncollectibles. At the end of the fiscal year, December 31, 2018, Accounts Receivable has a balance of $78,000 and had a total of $715,000 in credit sales. Arundel assumes that 2.0% of sales will eventually be uncollectible. before adjustment, the Allowance for Uncollectible Accounts had a credit balance of 6,000. What dollar amount should be credited to Allowance for Uncollectible Accounts at year end?

Q8. Salisbury Company uses the perpetual inventory system and had the following inventory & sales activity for the month of May 2019:

Date Activity Quantity Unit Price

5/1 Beginning Inventory 175 $10.50

5/5 Purchase 200 $11.50

5/10 Sales 300 $25

5/15 Purchase 200 $13.50

5/20 Sales 250 $28

5/25 Purchase 150 $13.00

Using the LIFO method, determine the dollar value for Ending Inventory at the end of month of May. Round to the nearest cent.

Q9. Adelphi Company purchased a machine on January 1, 2017, for $60,000. The machine was estimated to have a service life of ten years with an estimated residual value of $5,000. Adelphi sold the machine on January 1, 2021 for $30,000. Adelphi uses the double declining method for depreciation. Using this information, how much is the gain or (loss) for the equipment sale entry made on January 1, 2021. Enter a loss as a negative number.

Q10. Barbara is an employee of Baltimore Company. Baltimore Company pays employees the Friday after the wages are earned. Overtime in excess of 40 hours must be paid at 150% of the normal hourly rate. Social Security taxes are 6.2% and Medicare taxes are 1.45%. The federal unemployment tax rate is 1.0% and the state unemployment tax rate is 3.0%. Barbara's wages, including the current pay period, will not exceed the limits for Social Security, Medicare and unemployment taxes. Barbara earns $20 per hour and worked 45 hours for the week ended January 13, 2019. Baltimore will withhold $220 federal income taxes. Use this information to determine the total payroll tax expense for Baltimore Company as related to Barbara's earnings.