Reference no: EM133008076

Questions -

Q1. Sheffield Corp. recorded journal entries for the declaration of $246500 of dividends, the $160500 increase in accounts receivable for services rendered, and the purchase of equipment for $105000. What net effect do these entries have on stockholders' equity?

Increase of $55500.

Decrease of $351500.

Decrease of $86000.

Decrease of $191000.

Q2. On June 1, 2020, Sheridan Company loaned Carla Vista $1540000 on a 12% note, payable in five annual installments of $308000 beginning January 2, 2021. In connection with this loan, Carla Vista was required to deposit $5200 in a noninterest-bearing escrow account. The amount held in escrow is to be returned to Carla Vista after all principal and interest payments have been made. Interest on the note is payable on the first day of each month beginning July 1, 2020. Carla Vista made timely payments through November 1, 2020. On January 2, 2021, Sheridan received payment of the first principal installment plus all interest due. At December 31, 2020, Sheridan's interest receivable on the loan to Carla Vista should be

$0.

$46200.

$15400.

$30800.