Reference no: EM133019719

Questions -

Q1- At the end of its first year of operations, and before the adjusting entries at December 31, a company had a balance in accounts receivable of $250,000. The adjustments included a $2,000 write-off of an uncollectible account and recording bad debt expense of $3,500. What should the company report on its balance sheet at December 31, as net accounts receivable?

A. $246,500

B. $248,000

C. $248,500

D. $256,000

Q2- A corporation had total assets of $40,000, total liabilities of $20,000, and total contributed capital of $8,000 at the beginning of the year. For the year, the corporation earned net income of $50,000 and paid cash dividends of $10,000. At the end of the year, the company had total assets of $80,000 and its total contributed capital remained at $8,000. At the end of the year, the corporation had total liabilities of:

A. $-0-

B. $20,000

C. $28,000

D. $32,000

Q3- A corporation paid a six-year insurance premium on January 1, year 1, for $12,000. It recorded the prepayment in two asset accounts--one with a $2,000 debit balance and one with a $10,000 debit balance. Under which of the following captions should the account be with the $10,000 balance be classified on a balance sheet dated January 1, year 1?

A. Capital assets.

B. Other assets.

C. Deferred charges.

D. Current assets.