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GSU ACCT 2101 - Chapter 1 - 4 Review WebEx

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Tangent Company borrowed $100,000 from the bank signing an 8%, 6-month maturity note on September 1. Principal and interest are payable to the bank on March 1. If the company prepares monthly financial statements, the adjusting entrythat the company should make for interest on November 30, would be:a.debit Interest Expense, $8,000; credit Interest Payable, $8,000.b.debit Interest Expense, $667; credit InterestPayable, $667.c.No adjusting entry is needed on November 30.d.debit Interest Expense, $2,667; credit Interest Payable, $2,667.Henson Company began the year withretained earnings of $380,000. During theyear, the company recorded revenues of$500,000, expenses of $380,000, and paiddividends of $40,000. What was Henson’sretained earnings balance at the end of theyear?a.$540,000b.$460,000c.$840,000d.$500,000Benedict Company compiled the following financial information as of December 31, 2022:Service revenue $1,120,000Common stock 240,000Equipment 320,000Salaries/wages expense 400,000Rent expense 100,000Depreciation expense 500,000Cash 280,000Dividends 80,000Supplies 40,000Accounts payable 160,000Accounts receivable 120,000Retained earnings 1/1/2022 600,000Benedict’s total stockholders’ equity at December 31, 2022 isa.$840,000.b.$880,000.c.$640,000.d.$960,000.N3 Corporation has assets of $4,200,000,common stock of $1,092,000, and retainedearnings of $665,000. What are the creditors’claims on their assets?a.$3,773,000b.$1,757,000c.$2,443,000d.$4,627,000Use the following data to determine the total dollar amount of assets to beclassified as current assets.Pretty Pet SuppliesBalance SheetDecember 31, 2022Cash $ 126,000 Accounts payable $ 165,000Accounts receivable 120,000 Salaries and wages payable 30,000Inventory 210,000 Note payable (due 2025) 270,000Short-term investments 90,000 Total liabilities 465,000Land (held for future use) 255,000Land 285,000Buildings $339,000 Common stock 360,000Less: Accumulated Retained earnings 750,000 depreciation (60,000) 279,000 Total stockholders’ equity 1,110,000Franchise 210,000 Total liabilities and Total assets $1,575,000 stockholders’ equity $1,575,000a. $801,000b. $336,000c. $546,000d. $596,000Based on the following data, what is the amountof working capital?Accounts payable $64,000Accounts receivable $114,000Cash $70,000Intangible assets $100,000Inventory $138,000Long-term investments $160,000Long-term liabilities $200,000Short-term investments $80,000Notes payable (short-term) $56,000Property, plant, and equipment $1,340,000Prepaid insurance $2,000a. $284,000b.$332,000c. $370,000d.$326,000In the first month of operations, the total ofthe debit entries to the Cash accountamounted to $7,000 and the total of the creditentries to the Cash account amounted to$4,000. At the end of the month, the Cashaccount has aa.$4,000 credit balance.b.$7,000 debit balance.c.$3,000 debit balance.d.$3,000 credit balance.Barnes Company’s trial balance reported the following balances at theend of its first year:Cash $14,000Prepaid insurance 700Accounts receivable 3,500Accounts payable 2,800Notes payable 4,200Common stock 5,400Dividends 700Revenues 29,000Expenses 17,500What amount did Barnes Company’s trial balance show as totalcredits?a. $42,100b. $41,400c. $40,700d. $42,800When a service has been performed but nocash has been received, which of thefollowing statements is true?a.No journal entry is made.b.The entry includes a debit to accountspayable.c.The entry includes a credit to unearnedrevenue.d.The entry includes a debit to accountsreceivable.The Josey Company purchased equipment for $21,000 on October 1. It is estimated that annual depreciation on the computer will be $7,000. If financial statements are to be prepared on December 31, the company should make the following adjusting entry:a.debit Depreciation Expense, $7,000; credit Accumulated Depreciation, $7,000.b.debit Depreciation Expense, $1,750; credit Accumulated Depreciation, $1,750.c.debit Depreciation Expense, $14,000; creditAccumulated Depreciation, $14,000.d.debit Equipment, $1,750; credit Accumulated Depreciation,


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