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Brandon Company completed an aging of its accounts receivable and came up with an estimated amount o - $17.29

1.   Brandon Company completed an aging of its accounts receivable and came up with an estimated amount of $6,342. The credit sales for the period are $85,000. The balance in the allowance for doubtful accounts is a debit of $817. If Brandon uses 5% of credit sales as its estimating uncollectable accounts, how much will the credit be to the allowance for doubtful accounts if Brandon uses the estimate of aging receivables as its method of estimating uncollectable accounts?

A. $5,525
B. $5,067
C. $7,159
D. $4,250

2.   A company purchased furniture on January 1, 2012. Its cost was $15,600, and it had a residual value of $1,600. Its useful life is determined to be three years. Using double-declining balance depreciation, the depreciation for 2012 to the nearest dollar will be

A. $9,333.
B. $4,667.
C. $5,200.
D. $10,400.

3.   Using a 360-day year, the maturity value of a 69-day note for $1,500 at 7% annual interest is (rounded to the nearest cent)

A. $1,520.13.
B. $1,584,88.
C. $20.13.
D. $1,605.00

4.   Margaret is a customer of Tammy Company. The company wrote off her account of $1,200 on August 15. On October 12, she sent in a payment of $560. What will Tammy Company record first to reinstate her account?

A. Debit Uncollectible Accounts Expense; credit Accounts Receivable/Margaret.
B. Debit Cash; credit Accounts Receivable/Margaret.
C. Debit Allowance for Doubtful Accounts; credit Accounts Receivable/Margaret.
D. Debit Accounts Receivable/Margaret; credit Allowance for Doubtful Accounts.

5.   Ryan Corporation made a basket purchase of three items. Item A was appraised at $35,000; item B was appraised at $55,000; and item C was appraised at $60,000. The purchase price was $125,000. The amount at which item C should be recorded (rounded to the nearest dollar) is

A. $83,300.
B. $72,000.
C. $29,167.
D. $50,000.

6.   Brandon Corporation purchased a vein of mineral ore for $3,250,000. It is estimated that 15,000,000 tons of ore are available to be extracted. The salvage value is determined to be $400,000. The estimation depletion expense for this year's extraction of 1,760,000 tons of ore (rounded to the nearest dollar) is

A. $334,400.
B. $428,267.
C. $400,000.

7.   Brandon Company completed an aging of its accounts receivable and came up with an estimated amount of $6,342. The credit sales for the period are $85,000. The balance in the allowance for doubtful accounts is a debit of $817. If Brandon uses 5% of credit sales as its estimating uncollectable accounts, how much will the credit be to the allowance for doubtful accounts if Brandon uses the estimate of aging receivables as its method of estimating uncollectable accounts?

A. $4,250
B. $5,525
C. $5,067
D. $7,159

8.   If the amount extracted from a coal mine was different every year for four years, you would

A. credit accumulated depletion— coal mine for the same amount each year.
B. debit depletion expense for the same amount each year.
C. recompute the depletion expense rate per unit each year.
D. use the same depletion expense rate per unit each year.

9.   Ryan Corporation made a basket purchase of three items. Item A was appraised at $35,000; item B was appraised at $55,000; and item C was appraised at $60,000. The purchase price was $125,000. The amount at which item B should be recorded is

A. ($55,000/$95,000) × $150,000.
B. ($55,000/$125,000) × $150,000.
C. ($55,000/$95,000) × $125,000.
D. ($55,000/$150,000) × $125,000.

10.   A truck costing $56,000 has accumulated depreciation of $50,000. The truck is scrapped for $500. The journal entry to record this transaction is

A. debit Loss on Disposal $6,000, debit Accumulated Depreciation—Truck for $50,000, and credit Truck for $56,000.
B. debit Cash for $500, debit Loss on Disposal for $55,500, and credit Truck for $56,000.
C. debit Cash for $500, debit Truck for $50,000, debit Loss on Disposal for $5,500, and credit Accumulated Depreciation—Truck for $56,000.
D. debit Cash for $500, debit Accumulated Depreciation—Truck for $50,000, debit Loss on Disposal for $5,500, and credit Truck for $56,000.

11.   Nick Company has cash of $33,000; net accounts receivable of $41,000; short-term investments of $15,000; and inventory of $25,000. It also has $30,000 in current liabilities and $50,000 in long-term liabilities. The quick ratio for Nick Company is

A. 3.80.
B. 1.78.
C. 3.30.
D. 2.97.

12.   Rick Company has cash of $143,000; net accounts receivable of $89,000; short-term investments of $35,000; and prepaid expenses of $40,000. It also has $50,000 in current liabilities and $80,000 in long-term liabilities. The quick ratio for Rick Company is

A. 4.64.
B. 5.34.
C. 6.14.
D. 3.34.

13. A patent has amortization this year of $2,300. The journal entry would be

A. debit Amortization Expense— Patent, $2,300; credit Accumulated Depreciation— Patent, $2,300.
B. debit Amortization Expense—Patent, $2,300; credit Patent, $2,300.
C. debit Accumulated Amortization— Patent, $2,300; credit Amortization Expense— Patent, $2,300.
D. debit Accumulated Amortization— Patent, $2,300; credit Patent, $2,300.

14.   Jewell Company has current assets of $56,000; long-term assets of $135,000; current liabilities of $44,000; and long-term liabilities of $90,000. Jewell Company's debt ratio is

A. 70.2%.
B. 239.3%.
C. 127.3%.
D. 78.6%.

15.   A company receives a note payable for $3,500 at 9% for 45 days. How much interest (to the nearest cent) will the customer owe using a 360-day year?

A. $315.00
B. $39.38
C. $38.84
D. $354.38

16.   Meranda Corporation purchases a machine for $125,000. It has an estimated salvage value of $10,000 and is expected to produce 50,000 units in its lifetime. During the first year of operation, it produced 14,500 units. To the nearest dollar, the depreciation for the first year under the units of production method will be

A. $33,350.
B. $31,250.
C. $36,250.
D. $35,500.

17.   Using a 365-day year, the maturity value of a 180-day note for $2,700 at 9% annual interest is (rounded to the nearest cent)

A. $119.84.
B. $2,821.50.
C. $2,819.84.
D. $2,943.00.

18 Which of the following is not a benefit to extending credit to customers?

A. Increased profits
B. Increased revenues
C. Bad-debt expenses
D. Wider range of customers

19. Which of the following would not be a liability according to FASB's definition of a liability?

A. The signing of a three-year employment contract at a fixed annual salary
B. A note payable with no specified maturity date
C. An obligation to provide goods or services in the future
D. An obligation that's estimated in amount

20.   Casey Company's bank statement shows a bank balance of $43,267. The statement shows a bank service charge of $50 and a bank collection of $760 in Casey Company's behalf. Casey's book balance should be adjusted by a total of

A. +$760.
B. +$710.
C. –$710.
D. +$810.

21. By  Not accruing warranty expense

A. Reported Liabilities will be Understated
B. Reported Liabilities Will be Overstated
C. Reported Expenses will be Overstated
D. Reported Expenses will be Understated

Calculate the operating income that Westcoast Air earns on each one-way flight between San Francisco - $5.29

ACC 403 Module 5 Case

1. Calculate the operating income that Westcoast Air earns on each one-way flight between San Francisco and Fiji.

2. The Market Research Department of Westcoast Air indicates that lowering the average one-way fare to $280 will increase the average number of passengers per flight to 212. Should the company lower its fare? Show your calculations.

3. Travel International, a tour operator, approaches Westcoast Air on the possibility of chartering (renting out) its jet aircraft twice each month, first to take Travel International’s tourists from San Francisco to Fiji and then to bring the tourists back from Fiji to San Francisco. If Westcoast Air accepts Travel International’s offer, Westcoast Air will be able to offer only 184 (208 – 24) of its own flights each year. The terms of the charter are as follows:

(a) For each one-way flight,
Travel International will pay Westcoast Air $75,000 to charter the plane and to use its flight crew
and ground service staff;

(b) Travel International will pay for fuel costs;

(c) Travel International will pay for all food costs. On purely financial considerations, should Westcost Air accept Travel International’s offer? Show your calculations. What other factors should the company consider in deciding whether or not to charter its plane to Travel International?

Can you give specific benefits to be derived from using the information from computing gross profit - $3.79

ACC403 Module 2 Threaded Discussion

Threaded discussion question:

Absorption Income versus Contribution Margin Income

The background materials present the computations for both gross profit on sales and contribution margin. Can you give specific benefits to be derived from using the information from computing gross profit on sales as opposed to contribution margin? Is net income always going to be the same regardless of the accounting approach? Why don't we use the contribution margin format for external reporting? Which income statement is classified by function, and which one is classified by behavior? Look at the income statements below before you answer the questions.

ABC Company sells 10,000 widgets. The company has no beginning or ending inventory. Using the absorption approach (GAAP) the net income of the company is as follows:

Sales (10,000 @ $20) $200,000 Cost of goods sold (10,000 @ $12) 120,000 Gross profit $ 80,000 Expenses 20,000 Net income $ 60,000

Using the contribution margin approach the net income of the company is as follows:

Sales (10,000 @ $20) $200,000 Variable cost of goods sold (10,000 @ $8) 80,000 Contribution margin $120,000 Fixed expenses 60,000 Net income $ 60,000

CheckPoint: Accounting Assumptions, Principles, and Constraints - $5.29

CheckPoint: Accounting Assumptions, Principles, and Constraints

• Write an essay in 250 to 300 words, including the following:

o The basic assumptions of accounting

o The principles of accounting

o The constraints of accounting

o A conclusion stating how you think sound financial reporting depends on principles,

assumptions, and constraints. Refer to the U.S. GAAP in your response.

CheckPoint: Adjusting Entries, Posting, and Preparing an Adjusted Trial Balance - $5.29

CheckPoint: Adjusting Entries, Posting, and Preparing an Adjusted Trial Balance

• Complete parts a, b, and c of P3-1A on pp. 128–129 of Financial Accounting.

• Use the templates in Appendix D. Complete all three tabs.

• Post the completed Appendix D as an attachment.

CheckPoint: Closing Entries and a Post-closing Trial Balance - $5.29

CheckPoint: Closing Entries and a Post-closing Trial Balance

• Complete E4-4 on p. 177 of Financial Accounting. Use the templates in Appendix F and

complete all three tabs.

• Post the completed Appendix F as an attachment.

CheckPoint: Debits and Credits - $5.29

CheckPoint: Debits and Credits

• View PhxKlips Debits and Credits on your student Web site.

• Complete the questions and fill in the Account Changes matrix in Appendix B.

• Post the completed Appendix B as an attachment.

CheckPoint: Impacts of Unethical Behavior - $5.29

CheckPoint: Impacts of Unethical Behavior

• Research a company that has been in the news for unethical practices, such as Enron, Tyco,

Global Crossing, or WorldCom.

• Post a 250- to 300-word response that summarizes your ideas about the following:

o What was the nature of the controversy regarding this company’s practices?

o How were accounting practices involved?

o If you had been an accountant for this company, how would you have acted? Explain

why.

o What might have been done to prevent the controversy?

o What was the affect of unethical behavior on the profitability of the company?

CheckPoint: Ratio, Vertical, and Horizontal Analyses - $5.29

CheckPoint: Ratio, Vertical, and Horizontal Analyses

The calculations you perform for this CheckPoint form the basis of your analysis of your capstone

project.

• Write in 100 to 200 words an explanation of the three tools of financial statement analysis

and the function of each.

• Examine PepsiCo, Inc.’s Consolidated Balance Sheet on p. A6 in Appendix A of Financial

Accounting, especially its Current Assets, Current Liabilities, and Total Assets for years 2005

and 2004.

• Calculate the following for PepsiCo, Inc. and show your work:

o The Current Ratio for 2005

o The Current Ratio for 2004

o Two measures of vertical analysis—for example, compute the current assets divided by

total assets for each year, and express your result as a percentage

o Two measures of horizontal analysis—for example, compute the total change in assets

by percentage, by dividing current assets in 2005 by current assets in 2004. Compute a

similar percentage for current liabilities

• Examine The Coca-Cola Company’s Consolidated Balance sheet on p. B2 in Appendix B of

Financial Accounting, especially its Current Assets, Current Liabilities, and Total Assets for

years 2005 and 2004.

• Calculate the following for Coca-Cola and show your work:

o The Current Ratio for 2005

o The Current Ratio for 2004

o Two measures of vertical analysis—for example, compute the current assets divided by

total assets for each year, and express your result as a percentage

o Two measures of horizontal analysis—for example, compute the total change in assets

by percentage, by dividing current assets in 2005 by current assets in 2004. Compute a

similar percentage for current liabilities

• Post your explanation and calculations.

CheckPoint: Regulatory Bodies - $5.29

CheckPoint: Regulatory Bodies

• Post your response to the following question, using 250 to 300 words: What are the major

regulatory bodies and their functions?