Question

Adams, Inc. recorded the following journal entry on March​ 2, 2018.

Cash	7,500
Unearned Revenue		7,500

From the journal entry​ above, identify the transaction on March​ 2, 2018.

A.

Adams sold goods for

$7,500

cash.

B.

Adams received

$7,500

for services to be performed in a later period.

C.

Adams paid

$7,500

for services to be received at a later date.

D.

Adams purchased goods worth

$7,500

and signed a

one−year

note for the same amount.

A company has

$110,000

in current​ assets;

$550,000

in total​ assets;

$80,000

in current​ liabilities, and

$120,000

in total liabilities. Calculate the current ratio of the company.​ (Round your answer to two decimal​ places.)

A.

0.92

B.

1.77

C.

1.73

D.

The balances of select accounts of​ Sandra, Inc. as of December​ 31, 2018 are given​ below:

	Debit	Credit
Building	$110,000
Cash	8,000
Office Supplies	700
Furniture	4,000
Prepaid Insurance	600
Accumulated Depreciation—Furniture		$1,000
Land	30,000
Accumulated Depreciation—Building		4,500
Accounts Receivable	2,300

The insurance has been prepaid until June​ 30, 2019. Determine the amount of total current assets reported on the balance sheet at December​ 31, 2018.  

A.

$14,300

B.

$11,600

C.

$8,700

D.

The following are selected current​ month's balances for​ Morgan, Inc.

Accounts Payable	$10,000
Revenue	9,000
Cash	4,150
Expenses	1,100
Furniture	12,000
Accounts Receivable	15,000
Common Stock	9,250
Notes Payable	4,000

Based on this​ information, calculate the total amount of credits for the trial balance.

A.

$32,250

B.

$23,250

C.

$23,000

D.

$22,250

The following Office Supplies account information is available for​ Nabors, Inc.

Beginning balance	$1,500
Office Supplies expensed	6,000
Ending balance	1,000

From the above​ information, calculate the amount of office supplies purchased.

A.

$6,000

B.

$5,500

C.

$1,500

D.

$1,000

The net income of​ Hendley, Inc. for the year is

$30,000.

The dividends declared during the year were

$36,000.

Which of the following statements is​ true?

A.

Retained Earnings account increases by

$36,000.

B.

Retained Earnings account decreases by

$30,000.

C.

Retained Earnings account decreases by

$6,000.

D.

Retained Earnings will remain the same.

The Accounts Payable account of​ Waterford, Inc. has the following​ postings:

Accounts Payable
14,000	27,000
7,000	13,000

Calculate the ending balance of the account.

A.

$19,000

credit

B.

$19,000

debit

C.

$7,000

debit

D.

$13,000

credit

Watson Tax Planning Service has the following plant​ assets: Communications​ Equipment: Cost,

$7,200

with useful life of eight​ years; Furniture:​ Cost,

$21,600

with useful life of 12​ years; and​ Computer: Cost,

$12,000

with useful life of four years.​ (Assume residual value of all the assets is​ zero.) Watson's monthly depreciation expense calculated using the

straight−line

method is​ ________. (Round any intermediate calculations to two decimal​ places, and your final answer to the nearest​ cent.)

A.

$250.00

B.

$150.00

C.

$475.00

D.

Ten years ago a corporation purchased a building for

$150,000.

At that​ time, the corporation felt that the building was worth

$175,000.

The current market value of the building is

$470,000.

The building has been assessed at

$445,000

for property tax purposes. At which amount should the corporation record the building in its accounting​ records?

A.

$150,000

B.

$470,000

C.

$175,000

D.

A business purchases equipment by paying

$5,487

in cash and issuing a note payable of

$12,574.

Which of the following​ occurs?

A.

Cash is debited for

$5,487​,

Equipment is credited for

$12,574​,

and Notes Payable is debited for

$7,087.

B.

Cash is credited for

$5,487​,

Equipment is credited for

$18,061​,

and Notes Payable is debited for

$12,574.

C.

Cash is debited for

$5,487​,

Equipment is debited for

$12,574​,and

Notes Payable is credited for

$18,061.

D.

Cash is credited for

$5,487​,

Equipment is debited for

$18,061​,

and Notes Payable is credited for

$12,574.

Answer 1

1) Answer for Adams inc:

option B.

Adams received

$7,500

for services to be performed in a later period.

Explaination; Unearned revenue is the revenue that is received by a company or an individual for the service which has not been provided yet. So it becomes the liability for the seller until the goods or service is delivered or provided.
and in this question Adam is receiving $7500 for the service which has not been provided yet and will be provided in the later period.

_______________________________________________-

2) Current Ratio = current assets / current liabilties

Current Assets= 110,000

Current Liabilities= 80,000

Current Ratio= 110,000 / 80,000
= 1.37

(Note= in the above question , option D is not given . So I'm assuming Option D will be 1.37 as per formula )

_____________________________________________________-

3) Option B is correct i.e. $ 11,600

Explaination:

Current Assets in the given question will be Cash + office supplies + prepaid insurance + accounts receivable

so , 8000+ 700+600+2300 =11,600
_______________________________________________

4) Option A is correct i.e. $ 32,250

Explaination:

First we'll find all those account that will increase the credit and will add all of them together.
So,
Accounts Payable + Revenue + Common Stock + Notes Payable
= 10000 + 9000 + 9250 + 4000
= 32,250
____________________________________________________

5) Option B is correct i.e. $ 5500

Explaination:

Office supplies expended + closing office supplies - beginning office supplies
= 6000 + 1000 -1500
=5500

___________________________________

6) Option C is correct

Retained Earnings account decreases by $6,000.

______________________________________________

7) Option A is correct i.e. $19,000 Credit

Credit side= 27000 +13000 = 40000
Debit Side= 14000 +7000=21000

Credit Balance = 40000 - 21,000 = 19,000

Credit Side > debit side so 19000 Credit will be the answer

________________________________________________

8) Option C is correct i.e. $475

Explaination:

Depreciation=( Cost of Asset - salvage Value ) / life of asset

Commounication Equipment Depreciation= (7200 - 0 ) / 8

= 900 per year and 75 per month (900 /12)

Furniture= (21600 -0 ) /12

= 1800 per year and 150 per month ( 1800 /12)

Computer= ( 12000 - 0 ) /4

= 3000 per year and 250 per month

Total monthly depreciation expense = 75 + 150+ 250 = $475

_______________________________________________

9) Option A is correct i.e. $150,000

Explaination :

the corporation record the building in its accounting​ records at the cost at which building is purchased.

_____________________________________________________________-

10) Option D is correct i.e.

Cash is credited for $5,487​,

Equipment is debited for $18,061​,

and Notes Payable is credited for

$12,574.

Explaination:

Equipment= 5487 + 12574 = 18,061