137.Preferred stock that the issuing corporation has the option to retire by paying a specified amount to the preferred stockholders is called:    A.Convertible preferred stock. B.Callable preferred stock. C.Premium stock. D.Cumulative preferred stock. E.Participating preferred stock. 138.Achieving an increased return on common stock by paying dividends on preferred stock at a rate that is less than the rate of return earned with the assets […]

    31) The employees of Dew Drop Inn get paid every Friday for a 5-day workweek (Monday through Friday). The total payroll is $5,000 per day of work. If the accounting period ends on Wednesday of a given week and the proper adjustment is made on Wednesday, what will be the effect of the adjustment on the company’s financial statements? A) The balance sheet […]

  147. The actual price for a product was $50 per unit, while the planned price was $44 per unit. The volume increased by 4,000 to 60,000 total units. Determine the (a) quantity factor and the (b) price factor for sales.  148. On January 1 of the current year, C. F. Hartley Co. commenced operations. It operated its plant at 100% of capacity during January. The following […]

  11.What is the primary accounting issue for lessees? a.Recording interest expense on the lease obligation. b.Determining whether the lease meets the 90% of fair value test. c.Off-balance sheet financing. d.The measurement of the leased asset under a capital lease. 12.What is the primary accounting issue for lessors? a.Off-balance sheet financing. b.Revenue recognition and expense allocation over the lease term. c.Treating the lease in the […]

  83) For each of the following activities identify an appropriate activity-cost driver.   a.machine maintenance b.machine setup c.quality control d.material ordering e.production scheduling f.warehouse expense g.engineering design  83) _____________ 84) Brass, Chrome, and White. Production takes 25, 25, and 10 machine hours to manufacture 1000-unit batches of brass, chrome and white faucets, respectively. The following additional data apply: BRASSCHROME WHITE Projected sales in units30,00050,00040,000 […]

    96. All of the following are employer payroll taxes except:  A. Social Security tax equal to that withheld from employees. B. Medicare tax equal to that withheld from employees. C. State unemployment tax. D. Federal unemployment tax. E. Federal income tax equal to that withheld from employees.   97. FUTA taxes are:  A. Social Security taxes. B. Medicare taxes. C. Employee income taxes. D. Unemployment taxes. E. Employee deductions. 98. Which of the following is not […]

  11) Under the perpetual inventory system, in addition to making the entry to record a return of goods from a customer, a company would: A) debit Merchandise Inventory and credit Cost of Goods Sold. B) debit Cost of Goods Sold and credit Merchandise Inventory. C) debit Sales and credit Cost of Goods Sold. D) debit Purchases and credit Cost of Goods Sold. 12) A […]

  11) The accrual accounting rate-of-return method has a significant weakness for use in making capital budgeting decisions because it does NOT track cash flows and it ignores the time value of money. 12) As cash flows and time value of money are central to capital budgeting decisions, the AARR method is regarded as better than the IRR method.   13) Unlike the payback method, […]

  Use the information below to answer the following question(s).   Plastic Molding, Inc.’s costing system utilizes two cost categories; direct materials and conversion costs. Each product must pass through the Assembly Department and the Testing Department. Direct materials are added at the beginning of production. Conversion costs are allocated evenly throughout production. Data for the Assembly Department for March are:   Work in process, […]

  101. The formula for depreciable cost is  A. initial cost + residual value B. initial cost – residual value C. initial cost – accumulated depreciation D. depreciable cost = initial cost 102. Expected useful life is  A. calculated when the asset is sold. B. estimated at the time that the asset is placed in service. C. determined each year that the depreciation calculation is made. D. none of the answers are correct. 103. The calculation […]