Question : 61. Game Systems Corporation has grown significantly over the past year. : 1224889

61. Game Systems Corporation has grown significantly over the past year. The end-of-year supplies on hand totaled $200, and purchases totaled $3,000, and supplies on hand at the beginning of the year amounted to $180. How much will Game Systems report as supplies expense for the current year? 
A. $2,980
B. $3,180
C. $3,200
D. $3,000

62. On October 1, 2012, Glover Company borrowed $200,000 on a two-year, 12% note, with interest and principal to be paid at maturity. How much interest expense will Glover report on its income statement for the year ending December 31, 2012? 
A. $  6,000
B. $18,000
C. $24,000
D. $12,000

63. Youngblood Company borrowed $100,000 on a one-year, 10% note on October 1, 2012, with interest and principal to be paid at maturity. How much interest should Stone Company report on its income statement for the year ending December 31, 2013? 
A. $10,000
B. $12,500
C. $  2,500
D. $  7,500

64. Thompson Company borrowed $100,000 on a one-year, 10% note on September 1, 2012, with interest and principal to be paid at maturity. How much interest payable will be reported on Thompson’s balance sheet as of November 30, 2012? 
A. $  2,500
B. $  7,500
C. $10,000
D. $  3,333

65. Pro Incorporated operates five days per week with a daily payroll of $5,000. Employees are paid every Saturday for the workweek just completed (Monday through Friday). The last day of the month is Wednesday, October 31. What is the effect of the correct adjustment at October 31? 
A. Increases stockholders’ equity and wages payable by $15,000
B. Increases wages payable and decreases cash by $10,000
C. Decreases stockholders’ equity and increases wages payable by 15,000
D. Increases wages payable and increases wages expense by $25,000

66. Based on its income for the month, Bates Company estimates that it will owe $23,000 of federal income taxes for the month of May. What is the effect of the adjustment on the financial statements? 
A. Increase stockholders’ equity
B. Increase income taxes expense
C. Increase retained earnings
D. Decrease income taxes payable

67. Which one of the following adjustments increases net income for the period? 
A. Recognition of the amount of supplies used.
B. Recognition of the revenue earned, but not yet received.
C. Recognition of the wages earned, but not paid to employees.
D. Recognition of rent costs that had been paid to the landlord in advance.

68. Graystone Company’s plant operates five days per week with a daily payroll of $100,000. Employees are paid every Tuesday for the prior week’s work (Monday through Friday). The last day of the month is Tuesday, April 30. What effect does the accrual at April 30 have on Graystone’s net income? 
A. Increase by $200,000
B. Decrease by $300,000
C. Decrease by $200,000
D. Increase by $300,000

69. Wolf Industries plant operates five days per week with a daily payroll of $50,000. Employees are paid every Saturday for the work week just completed (Monday through Friday). The last day of the month is Wednesday, May 31. The correct adjusting entry at May 31 is 
A. Wages Expense                           50,000
     Wages Payable                                             50,000
B. Wages Payable                            50,000
     Cash                                                              50,000
C. Wages Expense                         150,000
     Cash                                                            150,000
D. Wages Expense                         150,000
     Wages Payable                                            150,000

70. Saturn Co. rented out office space to a tenant on January 1 and received a total of $90,000 for the first nine months of rent. The amount was recorded as Rent Collected in Advance when received. Adjustments are recorded only at the end of every quarter. What effect does the adjustment at March 31 have on Saturn’s net income for the quarter ending March 31? 
A. Increase by $90,000
B. Decrease by $60,000
C. Decrease by $30,000
D. Increase by $30,000