Question : 71. Current liabilities due A. and receivable within one year.B. but not receivable for : 1246553

 

71. Current liabilities are due 
A. and receivable within one year.
B. but not receivable for more than one year.
C. but not payable for more than one year.
D. and payable within one year.

72. Grayson Bank agrees to lend the Trust Company $100,000 on January 1.  Trust Company signs a $100,000, 8%, 9-month note.  The entry made by Trust Company on January 1 to record the proceeds and issuance of the note is 
A. Interest Expense                                  8,000
Cash                                                  92,000
                        Notes Payable                             100,000
B. Cash                                                 100,000
                        Notes Payable                             100,000
C. Cash                                                108,000
            Interest Expense                                        8,000
            Notes Payable                                         108,000
D. Notes Payable                                     100,000
Interest Payable                                      6,000
           Cash                                                         100,000
           Interest Expense                                           6,000

73. Grayson Bank agrees to lend the Trust Company $100,000 on January 1.  Trust Company signs a $100,000, 9%, 9-month note.  What is the adjusting entry required if Trust Company prepares financial statements on June 30? 
A. Interest Expense                                   9,000
            Interest Payable                                                  9,000
B. Interest Expense                                   4,500
            Interest Payable                                                  4,500
C. Interest Expense                                   6,750
            Interest Payable                                                  6,750
D. Interest Payable                                    4,500
            Interest Expense                                                  4,500

74. Grayson Bank agrees to lend the Trust Company $100,000 on January 1.  Trust Company signs a $100,000, 12%, 9-month note. What entry will Trust Company make to pay off the note and interest at maturity assuming that interest has been accrued to September 30? 
A. Notes Payable                                    109,000
            Cash                                                         109,000
B. Notes Payable                                    100,000
Interest Payable                                     9,000
            Cash                                                          109,000
C. Interest Expense                                    9,000
Notes Payable                                    100,000
            Cash                                                           109,000
D. Interest Payable                                   12,000
Notes Payable                                    100,000
            Cash                                                            112,000

75. As interest is recorded on an interest-bearing note, the Interest Expense account is 
A. decreased; the Interest Payable account is increased.
B. increased; the Interest Payable account is increased.
C. increased; the Notes Payable account is decreased.
D. increased; the Notes Payable account is increased.

76. The journal entry to record the conversion of an $550 accounts payable on January 31 to a notes payable would be: 
A. Jan 31   Cash                                      550
                     Notes Payable                                  550
B. Jan 31   Notes Receivable                   550
                     Notes Payable                                  550
C. Jan 31   Notes Payable                        550
                     Cash                                                550
D. Jan 31   Accounts Payable                   550
                     Notes Payable                                  550

77. On October 30, Seba Salon, Inc. issued a 90-day note with a face amount of $36,000 to Reyes Products, Inc for merchandise inventory.  Determine the adjusting entry for Seba on December 31 assuming the note carries an interest rate of 8%. 
A. Interest Expense                                           720
                 Interest Payable                                               720
B. Interest Expense                                           496
                 Interest Payable                                                496
C. Interest Receivable                                   2,880
                 Interest Revenue                                            2,880
D. Interest Receivable                                      480
                 Interest Revenue                                               480

78. Current liabilities are: 
A. due and receivable within one year.
B. due and to be paid out of current assets within one year.
C. due, but not payable for more than one year.
D. payable if a possible subsequent event occurs.

79. Which of the following would most likely be classified as a current liability? 
A. Two-year notes payable.
B. Bonds Payable.
C. Mortgage payable.
D. Unearned Rent.

80. When a $30,000, 90-day, 5% interest-bearing note payable matures, total payment will amount to: 
A. $31,500
B. $1,500
C. $30,375
D. $375

 

 

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