Question

In: Accounting

Use the following information to answer the next two questions: Shindo Inc. purchased land owned by...

Use the following information to answer the next two questions:
Shindo Inc. purchased land owned by Buffet, Inc. for $375,000 by giving a 300-day, 16% note payable.
1. The journal entry would include a debit to which type of account?
A. Asset
B. Liability
C. Owners’ Equity
D. Revenue
E. Expense
2. The journal entry would include a credit to which type of account?
A. Asset
B. Liability
C. Owners’ Equity
D. Revenue
E. Expense

3. A balance sheet is designed to show:
A. How much a business is worth.
B. The profitability of the business during the current year.
C. The amount of Dividends paid to shareholders since the business started operations.
D. The cost of replacing the assets and of paying off the liabilities at December 31.
E. None of the above.
4. The accountant for the Thomas Company forgot to make an adjusting entry to record accrued interest payable for the current year. The effect of this error would be:
A. An overstatement of net income and an understatement of liabilities.
B. An overstatement of assets offset by an understatement of owner’s equity.
C. An overstatement of assets, net income, and owner’s equity.
D. An overstatement of assets and of net income and an understatement of owner’s equity.
E. None of the above.
5. All the following accounts normally have credit balances except:
A. Fees Revenue
B. Common Stock
C. Prepaid Rent
D. Common Stock
E. None of the above
6. Closing entries never involve posting a credit to the:
A. Income Summary account.
B. Unearned Revenue account.
C. Retained Earnings account
D. Depreciation Expense account.
E. None of the above.
7. The CPA firm auditing Gable Company found that net income had been overstated. Which of the following errors could be the cause?
A. No entry made to record purchase of land for cash on the last day of the year.
B. Failure to record dividends declared and paid for the period.
C. Failure to record payment in cash of accounts payable on the last day of the year.
D. Failure to make an adjusting entry to record revenue which had been earned but not yet billed to customers.
E. None of the above.
8. The purpose of adjusting entries is to:
A. Update the balance in Common Stock.
B. Record certain revenue and expenses that are not properly measured in the course of recording daily routine transactions.
C. Update the balance in the Cash account.
D. Close all temporary accounts.
E. None of the above.
9. Depreciation expense may be described best as the:
A. Decline in the market value of an asset during the period.
B. Systematic allocation of the cost of long-lived assets to expense.
C. Cash payments made during the period on loans used to finance the purchase of assets such as buildings and equipment.
D. Cash being set aside each period to provide for the replacement of long-lived assets, such as buildings and equipment.
E. None of the above.

Solutions

Expert Solution

Use the following information to answer the next two questions:

Shindo Inc. purchased land owned by Buffet, Inc. for $375,000 by giving a 300-day, 16% note payable.

1. The journal entry would include a debit to which type of account?

A. Asset

B. Liability

C. Owners’ Equity

D. Revenue

E. Expense

Answer:

The Journal Entry would include a debit to Asset Account i.e. Land and land is an asset.

Hence, the correct option is A. Asset

2. The journal entry would include a credit to which type of account?

A. Asset

B. Liability

C. Owners’ Equity

D. Revenue

E. Expense

Credit would be Liability Account i.e. Notes Payable and Notes Payable is a Liability Account.

Hence the correct option is B. Liability

Hope the above calculations, working and explanations are clear to you and help you in understanding the concept of question.... please rate my answer...in case any doubt, post a comment and I will try to resolve the doubt ASAP…thank you

Pls ask separate question for remaining parts


Related Solutions

Use the following information to answer the next two questions: Stock                  Amount            &nb
Use the following information to answer the next two questions: Stock                  Amount                       Beta A                         25,000                         0.2 B                         20,000                         1.0 C                         30,000                         1.8 D                         25,000                         1.6 Risk-free rate is 3% and the market risk premium is 8% What is the required return for this portfolio?
Use the following information to answer the next two questions: Suppose society consists of two individuals,...
Use the following information to answer the next two questions: Suppose society consists of two individuals, A and B, who must split a fixed income of $100. Individual A’s marginal utility of income is given by MUA=400-8IA and individual B’s marginal utility of income is given by MUB=800-4IB. 17. If the social welfare function is given by W=UA+UB, then at the optimal distribution of           income, social welfare (W) is _______________. 18. Suppose instead that the social welfare function is...
Use the following information to answer the next four questions. The cash flows for two mutually...
Use the following information to answer the next four questions. The cash flows for two mutually exclusive projects are shown in the following table. Investors require a 16% rate of return for each project. Year Cash Flows: Project S (in millions) Cash Flows: Project T (in millions) 0 -200 -200 1 -20 50 2 45 60 3 70 30 4 -10 -40 5 125 100 6 125 100 7 150 100 Find the profitability index for project S. Round intermediate...
Use the following information to answer the next two questions. The market for good x can...
Use the following information to answer the next two questions. The market for good x can be represented by: Qd= 10 -P (note that it might be easier to graph if you rearrange the terms as P=10-Qd) Qs= -4 +P (and this might be easier to graph if you rearrange terms as P=4+Qs) Calculate consumer surplus in this market. a CS= 9 b CS= 4.5 c none of the answers provided here are correct d CS= 3 Use the following...
Use the following information to answer the next two questions. A bank manager believes the peso...
Use the following information to answer the next two questions. A bank manager believes the peso will appreciate relative to the peso in six months. The current spot rate for pesos is 10 pesos/euro and the six month forward rate is €.08/peso. The manager agrees to enter into a six month forward contract with 6 million pesos attached. The spot rate is 20 pesos/euro on the day the forward contract expires.Find the currency trader’s profit/loss (in euros) from their forward...
Use the following information to answer the next four questions: Consider two municipalities, A and B,...
Use the following information to answer the next four questions: Consider two municipalities, A and B, in the same province. Residents in municipality A enjoy attending outdoor music concerts (a public good) held in their public park. Each resident in municipality A has a marginal benefit curve for these concerts given by MB=10-2Q, where Q is the number of outdoor concerts. There are 100 residents in this municipality. Residents in municipality B do not enjoy outdoor music concerts (they are...
Use the following information to answer the next __4__ questions. Lucent Technologies, Inc. created the Statement...
Use the following information to answer the next __4__ questions. Lucent Technologies, Inc. created the Statement of Owners’ Equity for its year ended December 31, 2017. 2017 Common Paid-in Preferred Retained Treasury Transaction Stock Capital Stock Earnings Stock Total Beginning balance $1,450,000 $2,700,000 $750,000 $4,825,000 -$60,000 $9,665,000 March 250,000 400,000 -650,000 0 June -5,000 25,000 20,000 August 100,000 210,000 310,000 October 400,000 400,000 November -48,000 -48,000 December 1,500,000 1,500,000 Ending balance $1,800,000 $3,310,000 $1,150,000 $5,622,000 -$35,000 $11,847,000 1. On the...
Use the following information to answer the next five questions: On March 1st, Apple Inc. issued...
Use the following information to answer the next five questions: On March 1st, Apple Inc. issued 1,000 shares of $3 par value stock for a selling price of $10 per share. On May 1st, Apple Inc. reacquired 100 of the 1000 shares issued on March 1st for $15 per share. On June 1st, Apple reissued 100 shares for $20 per share. On June 10th, Apple declared a $1 per share dividend On June 12th, Apple paid the dividend that it...
Questions 4-8 USE THE FOLLOWING INFORMATION TO ANSWER THE NEXT (5) QUESTIONS: Pitchfork, Inc. sold merchandise...
Questions 4-8 USE THE FOLLOWING INFORMATION TO ANSWER THE NEXT (5) QUESTIONS: Pitchfork, Inc. sold merchandise to Min Corporation on June 1, 2019 and accepted an interest-bearing note with an 8% APR. Min agreed to make annual payments of P&I in the amount of $27,000 per year for 5 years with the first payment being made immediately. The remaining payments are to be remitted each June 1st. Pitchfork’s year-end is December 31st. Min’s normal cost to borrow is 8%. Required:...
Use the following information to answer the next three questions: The following information is available from...
Use the following information to answer the next three questions: The following information is available from the records of Aggies R Us, Inc. at the end of the 2017 calendar year.  Assume this is Aggies’ 1st year of operation. Accounts Receivable           $102,200        Notes Payable                       $???? Cash                                        70,890              Salary Expense                   320,000 Building                                    75,000           Retained earnings ???? Advertising Expense                60,000             Accounts Payable                  62,800                                    Dividends                                 12,200             Income Tax Expense             23,100 Service Revenues                  460,000             Common Stock                    120,000            Office Equipment                     22,500             Wages Payable                     15,450 Determine Aggies’ Net Income for the year ended December 31, 2017: A. $36,900 B. $80,000 C. $56,900 D. $44,700...
ADVERTISEMENT
ADVERTISEMENT
ADVERTISEMENT