Reference no: EM132857140
Questions -
Q1. On March 1, 2019, Company B issued $1,000,000, 10 years, 12% bonds at 103 excluding accrued interest. The bonds are dated January 1, 2019 and will mature on January 1, 2029. The interest is payable semi-annually on January 1 and July 1 of each year. Company B paid transaction costs amounting to $50,000. How much would be the net cash receipts of Company B as a result of the bond issuance?
a. $1,000,000
b. $1,030,000
c. $980,000
d. $1,050,000
Q2. Company H acquired an equipment on June 1, 2020 amounting to $35,000 with an estimated useful life of 5 years. What would be the reported carrying value of the equipment on December 31, 2021 if the residual value at the end of 5 years is $5,000?
a. $25,500
b. $32,000
c. $29,000
d. $26,000
Q3. Company C produced 10,000 units of Product C-123 for the month of October 200A. The prime cost for the month is $50,000, the direct labor is $15,000, and the manufacturing overhead cost is $10,000. Company C sold 8,000 units in October for $10 per unit. Also, there were no ending inventories for the month of September 200A. How much is the total cost of goods sold for the month of October 200A?
a. $80,000
b. $60,000
c. $52,000
d. $48,000
Q4. Company R uses a process costing system. The weighted average method is used in the computation of equivalent units of production. On June 1, 2020, the work-in process inventory consists of 10,000 units which were 50% completed as to conversion cost. Units transferred-in during the month of June were 35,000. The ending work-in process of 8,000 units was 25% completed as to conversion cost. What is the EUP for conversion cost for the month of June?
a. 39,000 units
b. 34,000 units
c. 37,000 units
d. 35,000 units
Q5. X Company estimates that 2% of its sales on account for the year ended December 31, 200A will be uncollectible. If the total sales is $4,500,000 and 20% is cash sales, the adjusting entry for the December 31, 200A will include
Accounts Receivable $90,000
Allowance for Bad Debts $72,000
Bad Debts Expense $18,000
An adjusting entry is not necessary
Q6. Assuming a 365-day year, how long (in average days) does the collectibles from customers stay as outstanding accounts receivable if Company Z has a total sale of $1,800,000 of which $200,000 are cash sales and the beginning and ending accounts receivable balances are $30,000 and $50,000, respectively.
a. 11.40 days
b. 9.13 days
c. 6.84 days
d. 8.11 days
Q7. Company S purchased 1,000 units raw materials amounting to $5,000 and used $4,500 worth for the production during the current month. The standard price for these raw materials is $5.2 per unit. How much is the materials price variance for the current month if Company S analyzes the variance at the point of purchase?
a. $200 favorable
b. $200 unfavorable
c. $700 favorable
d. $700 unfavorable
Q8. The sole proprietorship business of Individual M purchased a machinery amounting to $30,000. The machinery is expected to be useful for a period of 4 years and have a residual value of $5,000. Individual M uses the double-declining method in depreciating their fixed assets. How much would be the depreciation expense for year 3?
a. $3,750.00
b. $2,500.00
c. $7,500.00
d. $1,250.00
Q9. T Corporation is authorized to issue 500,000 common stock at $10 par value. As of December 31, 2019 the corporation has 350,000 common stock issued and outstanding. On February 14, 2020, the market price of the stock is $17. On the same date, T Corporation acquired 50,000 stocks at $15. On March 5, 2020, the company reissued 25% of the treasury stocks at $20. Which of the following will be included in the entry to record the transaction on March 5, 2020?
a. Debit Treasury Shares $187,500
b. Debit Common Stock $250,000
c. Credit Additional Paid-in Capital $62,500
d. Credit Cash $250,000
Q10. The amortization of premium on bonds payable will _____________ the net income.
a. increase
b. decrease
c. not affect
d. offset