Answer the following questions using the information below:   The Bandage Medical Supply Company has two divisions that operate independently of one another. The financial data for the year 2012 reported the following results:   NorthSouth Sales$6,000,000$5,000,000 Operating income1,500,0001,100,000 Taxable income1,300,000750,000 Investment12,000,00010,000,000   The company’s desired rate of return is 10%. Income is defined as operating income.   31) What are the respective return-on-investment […]

  200. Black Company’s unadjusted and adjusted trial balances on December 31 of the current year are as follows     Unadjusted Trial Balance Adjusted Trial Balance Cash 4,000   4,000   Prepaid insurance 1,600   1,200   Equipment 9,000   9,000   Accumulated depreciation – Equipment     900     1,800 Salaries payable       1,000 Unearned repair fees   2,500   600 […]

    81. In general, consolidated financial statements should be prepared  A. when a corporation owns more than 20% and less than 40% of the common stock of another company B. when a corporation owns more than 50% of the common stock of another company C. only when a corporation owns 100% of the common stock of another company D. whenever the market value of the stock investment is significantly […]

  109.Fragmental Co. leased a portion of its store to another company for eight months beginning on October 1, at a monthly rate of $800. Fragmental collected the entire $6,400 cash on October 1 and recorded it as unearned revenue. The journal entry made by Fragmental Co. at year-end on December 31 would be:    A.A debit to Rent Revenue and a credit to Cash for […]

  116. Use the following information to calculate cash received from dividends: Dividends revenue……………. $29,800 Dividends receivable, January 1 ……. 2,600 Dividends receivable, December 31 ….. 3,400 A. $26,400.B. $29,000.C. $29,800.D. $30,600.E. $32,400. 117. Use the following information to calculate cash received from dividends: Dividends revenue……………. $63,500 Dividends receivable, January 1 ……. 3,600 Dividends receivable, December 31 ….. 3,100 A. $63,500.B. $63,000.C. $64,000.D. $67,100.E. $60,400. 118. Analysis reveals that a company had a net increase in cash of […]

  184. Prepare an income statement and a retained earnings statement for the month ended September 30, 2011, from the T accounts below of Carson Company.  Prepaid Insurance   Accounts Receivable   Unearned Revenues   Wages Payable 1,400     1,600       1,200     225   80      500     350                     […]

  108.The Gardner Company expects sales for October of $248,000. Experience suggests that 45% of sales are for cash and 55% are on credit. The company collects 50% of its credit sales in the month of sale and 50% in the month following sale. Budgeted Accounts Receivable on September 30 is $67,000. What is the amount of cash expected to be collected in October?     […]

  103. The Venus Manufacturing Company reports the following information related to its only pension plan for 2013 (amounts in millions). Pension Plan Assets, Beginning of 2013.. . . . . . . . . . . . . . . . . . . . . . . . . . . $43,484  Plus Actual Return on Investments . . . . . . . […]

  51. A company acquires land by issuing 10,000 shares of its $10 par value common stock currently trading at $20 per share and the appraised value of the land is $250,000. Which of the following statements correctly describes the recording of the land?  A. Record the land at its appraised value of $250,000 and recognize a gain of $50,000 since the issued stock is currently worth […]

  21.If a loss contingency related to a lawsuit against a firm is deemed to have a remote probability of requiring ultimate payment, then the proper accounting treatment of the loss contingency will a. increase the debt/equity ratio. b. increase the debt/asset ratio. c. have no effect on earnings per share. d.increase the quick ratio. 22.An increase in a deferred tax liability is recognized when […]