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

Solution for the Following:

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

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