Question

30-Internal operating activities include research and development, distribution, and human resources.

true or false

31-Paul’s Landscaping paid $640 on account for supplies purchased in the prior month. Which of the following general journal entries will Paul’s Landscaping make to record this transaction?

• Debit Office supplies expense, $640; credit Cash, $640.

• Debit Cash, $640; credit Office supplies, $640.

• Debit Office supplies, $640; credit Cash, $640.

• Debit Office supplies, $640; credit Accounts payable, $640.

• Debit Accounts payable, $640; credit Cash, $640.

  
  

32-A company's old machine that cost $43,000 and had accumulated depreciation of $32,700 was traded in on a new machine having an estimated 20-year life with an invoice price of $53,300. The company also paid $45,700 cash, along with its old machine to acquire the new machine. If this transaction has commercial substance, the new machine should be recorded at:

• $10,300.

• $56,000.

• $43,000.

• $50,600.

• $53,300.

Answer 1

Answer 30.

Statement is true.

Answer 31.

Correct option is last one.

Debit Accounts payable, $640; credit Cash, $640. Because it was already purchased in the last month and the purchase entry must have been passed. And this month it will pay the amount.

Answer 32.

Correct option is second one.

The net book value on the old machine is ($43,000 - $32700) = $10,300.

New machine should be recorded at = 10300 + 45700 = 56000