Multiple Choice Questions   31. Which of the following statements is correct?  A. The accountant obtains information about wages subject to payroll taxes from the payroll register. B. Most commercial banks are authorized to accept the employee’s tax deposits for federal income taxes withheld and the employer’s and employees’ shares of social security taxes. C. Payroll tax deposits can be made electronically or using a Federal Tax Deposit […]

  111. When a company exchanges machinery and receives a trade-in allowance greater than the book value, this transaction would be recorded with the following entry (assuming the exchange was considered to have commercial substance):  A. debit Machinery and Accumulated Depreciation; credit Machinery, Cash, and Gain on Disposal B. debit Machinery and Accumulated Depreciation; credit Machinery and Cash C. debit Cash and Machinery; credit Accumulated Depreciation D. debit Cash and […]

  21) What is the Refining Division’s operating income if 150 litres of oil are sold at $110 /litre and 200 litres are transferred in? Assume the transfer price is based on 175% of variable costs. A) $16,500 B) $15,600 C) $8,400 D) $7,500 E) $8,500 22) Division A sells soybean paste internally to Division B, which, in turn, produces soybean burgers that sell for […]

  41) If contribution margin is $45 per unit, sales in June are 5,000 units and sales in July are 6,000 units, and operating income was $150,000 in June, and fixed manufacturing costs were $25,000 in July, and there was a 10,000 production volume variance (F) in July, what is July’s operating income under variable costing?   41) ______ A) $115,000 B) $150,000 C) $135,000 […]

  15) An organization determines its allocation base depending upon which of the following factors? A) the purpose served by the cost allocation base B) the size of the base C) the number of different items in the base D) the performance of the denominator activity E) benchmarking competitor processes   16) When all of a cost pool’s individual activities have the same or similar […]

  21) During the month of October, Ford advertised on the Internet. Ford received the bill for $600 in October, but waited until November to pay the advertising expense. The journal entry to record the payment in November is: A) Accounts Payable, debit; Cash, credit B) Advertising Expense, debit; Accounts Payable, credit C) Advertising Expense, debit; Cash, credit D) The journal entry is not made […]

  41) Stephen’s Storage Company needed some long-term financing and arranged for a 20-year, $100,000, 9% mortgage loan on January 1, 2011. Annual payments of $10,955 will be made on December 31 each year.   Part A: Prepare an amortization schedule for the first two loan payments:   Mortgage balance   Annual payment Interest portion of mortgage Amount of mortgage reduction Beginning balance $100,000 1st […]

    31. U.S. GAAP and IFRS require firms to classify marketable securities that are neither debt securities held to maturity nor trading securities as _____.   A. derivative securities B. noncurrent securities C. securities not available-for-sale D. securities available-for-sale E. marketing making securities   32. Which of the following is/are not true?  A. Securities available-for-sale that a firm intends to sell within one year appear in marketable securities in the current assets […]

  101. The calculation for annual depreciation using the straight-line depreciation method is  A. initial cost / estimated useful life B. depreciable cost / estimated useful life C. depreciable cost * estimated useful life D. initial cost * estimated useful life 102. The calculation for annual depreciation using the units-of-production method is  A. (initial cost/estimated output) * the actual yearly output B. (depreciable cost / yearly output) * estimated output C. depreciable cost / […]

    111. A company purchased a new truck at a cost of $42,000 on July 1, 2014. The truck is estimated to have a useful life of 6 years and a salvage value of $3,000.  Using the straight- line method, how much depreciation expense will be recorded for the truck for the year ended December 31, 2014?  A. $3,250 B. $3,500 C. $4,000 D. $6,500 E. $7,000     112. A […]