Reference no: EM132497893

Question 1: An asset that cost $20,000 and has accumulated amortization of $15,000 is sold for $2,000. The journal entry would include a:

a) debit to Loss on Disposal of $5,000.

b) debit to Loss on Disposal of $3,000.

c) credit to Gain on Disposal of $3,000.

d) credit to Accumulated Amortization for $15,000.

Question 2: After selling the assets and paying the creditors, the partnership had $90,000 cash remaining. A, B, and C had capital balances of $20,000, $30,000 and $40,000 respectively. Income is shared on a ratio of 1:4:5, respectively. The cash to be received by partner C would be:

a) $30,000.

b) $40,000.

c) $45,000.

d) $50,000.

Question 3: A company had 50,000 common shares. During the period, a 10% stock dividend was declared and distributed. The market value was $25 a share. As a result of this stock dividend, retained earnings should increase (decrease) by:

a) $50,000.

b) $(50,000).

c) $125,000.

d) $(125,000).