3.3   Learning Objective 3-3   1) The informal listing of the ledger accounts and their balances in the ledger to aid in providing the equality of debits and credits is the: A) journal. B) ledger. C) income statement. D) trial balance.   2) If the debit and credit totals of a trial balance are not equal, it could be due to the following type […]

    111.The fair market value of Lewis Company’s net identifiable assets is $5,000,000. Martin Corporation purchases Lewis’ entire business for $5,800,000. Which of the following statements is not correct?    A. Martin Corporation paid $800,000 for goodwill generated by Lewis Company.   B. Martin feels that Lewis Company has the ability to generate earnings in excess of a normal return on net identifiable assets.   C. Martin will […]

  116.Springfield Company offers a bonus plan to its employees and the amount of the employee bonuses for the current year is estimated to be $32,500 to be paid during January of the following year. The journal entry on December 31 to record the bonuses is:     A.Debit Estimated Bonus Payable $32,500; credit Cash $32,500. B.Debit Employee Bonus Expense $32,500; credit Bonus Payable $32,500. C.No […]

  17.1   Learning Objective 17-1 1) Many associations such as medical centers and law firms could organize as a: A) sole proprietorship. B) corporation. C) partnership. D) Both B and C are correct. 2) The accounting procedures are the same for sole proprietorships as for partnerships with the exception of: A) the asset section includes more than one cash account. B) the liability section. C) […]

  11) Which of the following statements is true concerning operating leverage? A) It summarizes the risk-return tradeoff across alternate revenue possibilities. B) It measures the change in operating income when costs change proportionately with the change in the number of units sold. C) The degree of operating leverage increases inversely to the number of units sold. D) The degree of operating leverage remains constant […]

    81. The entry to record patent amortization of $4,500 embedded in a product is as follows:   A. Work-in-Process Inventory . . . . . . . . . . . . . . . . . . . . . . . . . . .  4,500   Patent . . . . . . . . . . . . . . . […]

    91. When the market rate of interest was 12%, Halprin Corporation issued $1,000,000, 11%, 10-year bonds that pay interest annually.  The selling price of this bond issue was  A. $ 321,970 B. $1,000,000 C. $ 943,494 D. $621,524   92. When the market rate of interest was 11%, Munson Corporation issued $1,000,000, 12%, 8-year bonds that pay interest semiannually.  The selling price of this bond issue was  A. $1,052,310 B. $1,154,387 […]

  133.Use the information in the adjusted trial balance presented below to calculate current assets for Taron Company:  A.$21,200. B.$45,600. C.$24,400. D.$95,600. E.$41,200. 134.Use the information in the adjusted trial balance presented below to calculate the current ratio for Taron Company:  A.1.87. B..54. C.3.92. D.1.77. E.1.60. 135.Which of the following statements regarding reporting under GAAP and IFRS is not true:    A.Both GAAP and IFRS define […]

74.Royer Corporation engaged in this transaction:   Received dividends on securities held.   Indicate which section, if any, each transaction would appear in, or relate to, on a statement of cash flows.   a. Financing activities section b. Investing activities section c. Operating activities section d. Schedule of noncash investing and financing transactions       75.Royer Corporation engaged in this transaction:   Paid income […]

  91.The following information is taken from Reagan Company’s December 31 balance sheet:  Cash and cash equivalents$8,419 Accounts receivable70,422 Merchandise inventories60,362 Prepaid expenses4,100 Accounts payable$14,950 Notes payable86,638 Other current liabilities9,500 If net credit sales for the current year were $612,000, the firm’s days’ sales uncollected for the year is:     A.60 days B.85 days C.42 days D.154 days E.70 days 92.An income statement account that […]