1.Under the capital method of accounting for leases the excess of aggregate rentals over the cost of leased property should be recognized as revenue of the lessor a.In increasing amounts during the term of the lease b.In constant amounts during the term of the lease c.In decreasing amounts during the term of the lease d.After the cost of leased property has been fully recovered […]

    48. The entry to record depreciation is an example of an adjusting entry:  A. To apportion a recorded cost. B. To apportion unearned revenue. C. To convert a liability to revenue. D. To record unrecorded revenue.     49. During the last month of its fiscal year, Echo Lake Resort accepted numerous deposits from customers. By the end of the month many, but not all, of these guests had […]

    101. A business operated at 100% of capacity during its first month, with the following results:  Sales (90 units)   $90,000 Production costs (100 units):       Direct materials $40,000     Direct labor 20,000     Variable factory overhead 2,000     Fixed factory overhead   5,000 67,000       Operating expenses:       Variable operating expenses $ 8,000     […]

  116.Juniper Company uses a perpetual inventory system. The company purchased $9,750 of merchandise on August 7 with terms 1/10, n/30. On August 11, it returned $1,500 worth of merchandise. On August 16, it paid the full amount due. The correct journal entry to record the payment on August 16 is:     A.Debit Merchandise Inventory $8,250; credit Cash $8,250. B.Debit Cash $8,250; credit Accounts Payable […]

    91. What cost concept used in applying the cost-plus approach to product pricing includes only total manufacturing costs in the “cost” amount to which the markup is added? A. Variable cost conceptB. Total cost conceptC. Product cost conceptD. Opportunity cost concept   92. Managers who often make special pricing decisions are more likely to use which of the following cost concepts in their work? A. Total costB. Product costC. Variable costD. Fixed cost   93. Defense […]

  101. A corporation issues for cash $1,000,000 of 10%, 20-year bonds, interest payable annually, at a time when the market rate of interest is 12%. The straight-line method is adopted for the amortization of bond discount or premium. Which of the following statements is true?  A. The amount of the annual interest expense is computed at 10% of the bond carrying amount at the beginning of […]

  177. Based on the information provided below for Krackle Corp., complete the following worksheet to be used to prepare the statement of cash flows using the indirect method. (a) Net income for the year was $30,000.(b) Dividends of $10,000 were declared and paid.(c) Krackle’s only noncash expense was depreciation which totaled $50,000.(d) The company purchased plant assets for $70,000.(e) Notes payable in the amount of […]

    91.    Standard Actual Material Cost Per Yard $2.00 $2.10 Standard Yards per Unit 4.5 yards 4.75 yards Units of Production   9,500       Calculate the Direct Materials Price variance using the above information: A. $1,795.50 FavorableB. $378.00 FavorableC. $4,512.50 UnfavorableD. $378.00 Unfavorable   92.    Standard Actual Material Cost Per Yard $2.00 $2.10 Standard Yards per Unit 4.5 yards 4.75 yards Units of Production   […]

    61. A T-account is a device or convention for organizing and accumulating the accounting entries of transactions that affect an individual account.  Which of the following is true?   A. Increases in assets appear on the left side, and decreases in assets appear on the right side of T-accounts. B. Increases in liabilities appear on the right side, and decreases in liabilities appear on the left […]

  68.A plan that reports the units or costs of merchandise to be purchased by a merchandising company during the budget period is called a:    A.Selling expenses budget. B.Merchandise purchases budget. C.Sales budget. D.Cash budget. E.Capital expenditures budget. 69.A plan showing the planned sales units and the revenue to be derived from these sales, and is the usual starting point in the budgeting process, is […]