Typewriter Plus purchased equipment for $40,000 on September 30, 2019. The equipment has a residual value...

Typewriter Plus purchased equipment for $40,000 on September 30, 2019. The equipment has a residual value of $8,000 and estimated life of 8 years. Calculate the net book value of the equipment on December 31, 2020.

Multiple Choice

$32,000
$28,000
$35,000
$36,000

Which of the following statements about debits is false?

Multiple Choice
Debits increase assets.
Debits decrease stockholders’ equity.
Debits increase liabilities.
Debits decrease liabilities.

Elephant Company calculated depreciation per year of $8,000 on a building it purchased on January 1, 2019. How much accumulated depreciation will appear in the December 31, 2020 financial statements?

Multiple Choice
$12,000
$24,000
$16,000
$8,000

Kettle Company received but did not pay its electric bill. What journal entry should Kettle Company record?

Multiple Choice
Debit utilities expense and credit utilities payable
Debit utilities expense and credit cash
Debit utilities payable and credit cash
Debit utilities payable and credit utilities expense

If a company debits an expense account, what impact does that have on stockholders’ equity?

Multiple Choice
Decreases stockholders’ equity
Increases stockholders’ equity
There is no effect on stockholders’ equity

A transaction has been recorded in the T-accounts of Gibbs Company as follows:

Cash

1,500

Unearned Revenue

1,500

Which of the following could be an explanation for this transaction?

Multiple Choice
Gibbs has received cash for services to be provided in the future.
Gibbs has provided services to a customer on account.
Gibbs has completed services for which they had earlier received cash in advance.
Cash has been paid out to a company that will provide future services to Gibbs Company.

Expert Solution

ekkarill92 answered 1 year ago

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