Question

1a) These are selected account balances on December 31, 2018.

                        Land (location of the corporation’s office building)                 $120,000

                        Land (long-term investment, held for future use)                         75,000

                        Corporate Office Building                                                           110,000

                        Inventory                                                                                        80,000

                        Trademark                                                                                     70,000

                        Prepaid Insurance                                                                          50,000

                        Accumulated Depreciation                                                            20,000

What is the total amount of property, plant, and equipment that will appear on the balance sheet?

a. $210,000.

b.$230,000.

c.$285,000.

d.$315,000.

The income statement for the month of May, 2018 of Snap Shot, Inc. contains the following information:

Revenues Expenses:		$7,300
Salries and Wages Expense	$3,000
Rent Expense	1,300
Advertising Expense	700
Supplies Expense	200
Insurance Expense	100
Total expenses		5,300
Net income		$2,000

At May 1, 2018, Snap Shot reported owner’s equity of $36,000. The company had no owner drawings during June. At May 31, 2018, the company will report owner’s equity of

a. $30,700.

b.$36,000.

c.$38,000.

d.$43,300.

Answer 1

Question 1a)

Answer C) $285,000

Land (location of the corporation’s office building)	$ 120,000.00
Land (long-term investment, held for future use)	$    75,000.00
Corporate Office Building	$ 110,000.00
Total Property plant and Equipment	$ 305,000.00
Less: Accumulated Depreciation	$    20,000.00
Boon value of Poperty plant and equipment	$ 285,000.00

Second Question

Correct Answer---(C) $38,000

Calculations

               

Beginning balance in Owner's Equity	$    36,000.00
Add: Net income	$      2,000.00
Ending balance in Owner's Equity	$    38,000.00

Net income is added to owner’s equity and drawings are deducted. Since there are no drawings owner;s equity ending balance will equal beginning balance plus net income earned.