Question

16-20

Any balance in an unearned revenue account is reported as a(n)

		current liability
		long-term debt
		revenue
		unearned liability

If stock is issued for less than par value, the account

		Paid-In Capital in Excess of Par Value is credited.
		Paid-In Capital in Excess of Par Value is debited if a debit balance exists in the account
		Paid-In Capital in Excess of Par Value is debited if a credit balance exists in the account.
		Retained Earnings is credited

On October 1, Jerry's Carpet Service borrows $250,000 from First National Bank on a 3-month, $250,000, 8% note. The entry by Jerry's Carpet Service to record payment of the note and accrued interest on January 1 is

		Notes Payable debit 255,000 Cash credit 255,000
		Notes Payable debit 250,000 Interest Payable debit 5,000 Cash credit 255,000
		Notes Payable debit 250,000 Interest Payable debit 20,000 Cash credit 270,000
		Notes Payable debit 250,000 Interest Expense debit 5,000 Cash credit 255,000

On January 31, Exploration Co. reaquired 22,500 shares of its common stock at $31 per share. On April 20, the company sold 12,800 of the reacquired shares at $40 per share. On October 4, the company sold the remaining shares at $28 per share. What is the journal entry for October 4?

		Debit cash 270,400; Debit Paid in capital treasury stock $29,100; Credit treasury stock 299,500.
		Debit cash 271,600; Debit Paid in capital treasury stock $29,100; Credit treasury stock 300,700.
		Debit cash 512,000; Credit Paid in capital treasury stock $396,800; Credit treasury stock $115,200.
		Debit cash 697,500; Credit Paid in capital treasury stock $115,200; Credit treasury stock $582,300.

A stock split is a process by which a corporation reduces the par or stated value of its common stock and issues a proprotionate numer of additional shares.

True

False

Answer 1

1) Any balance in an unearned revenue account is reported as a(n)

So answer is a) Current liabilities

2) If stock is issued for less than par value, the account

So answer is c) Paid-In Capital in Excess of Par Value is debited if a credit balance exists in the account.

3) On October 1, Jerry's Carpet Service borrows $250,000 from First National Bank on a 3-month, $250,000, 8% note. The entry by Jerry's Carpet Service to record payment of the note and accrued interest on January 1 is

So answer is d) Notes Payable debit 250,000 Interest Expense debit 5,000 Cash credit 255,000

4) On January 31, Exploration Co. reaquired 22,500 shares of its common stock at $31 per share. On April 20, the company sold 12,800 of the reacquired shares at $40 per share. On October 4, the company sold the remaining shares at $28 per share. What is the journal entry for October 4?

SO answer is b) Debit cash 271,600; Debit Paid in capital treasury stock $29,100; Credit treasury stock 300,700.

5) A stock split is a process by which a corporation reduces the par or stated value of its common stock and issues a proprotionate numer of additional shares.

So above statement is True