Question

In: Accounting

11. Cendant Corporation's results for the year ended December 31, 2018, include the following material items:...

11.

Cendant Corporation's results for the year ended December 31, 2018, include the following material items:

Sales revenue $ 6,220,000
Cost of goods sold 3,800,000
Selling and administrative expenses 1,260,000
Loss on sale of investments 200,000
Loss on discontinued operations 491,000
Loss on impairment from continuing operations 62,000


Cendant Corporation's income from continuing operations before income taxes for 2018 is:

Multiple Choice

a. $956,600.

b. $898,000.

c. $960,000.

d. $407,000.

12.

Schneider Inc. had salaries payable of $61,000 and $90,600 at the end of 2017 and 2018, respectively. During 2018, Schneider recorded $620,300 in salaries expense in its income statement. Cash outflows for salaries in 2018 were:

Multiple Choice

a. $590,700.

b. $529,700.

c. $649,900.

d. $620,300.

13.

Howard Inc. had prepaid rent of $77,000 and $84,000 at the end of 2017 and 2018, respectively. During 2018, Howard recorded $242,000 in rent expense in its income statement. Cash outflows for rent in 2018 were:

Multiple Choice

a. $235,000.

b. $242,000.

c. $249,000.

d. $256,000.

14.

Martel Co. had supplies of $27,000 and $39,000 at the end of 2017 and 2018, respectively. During 2018, Howard paid $134,000 for supplies. Supplies expense in the 2018 income statement was:

Multiple Choice

a. $122,000.

b. $134,000.

c. $146,000.

d. $110,000.

15.

Stinley Co. paid utilities of $144,000 during 2018. At the end of 2018, utilities payable equals $40,000 and utilities expense equals $165,000. What was the balance of utilities payable at the beginning of 2018?

Multiple Choice

a. $42,000.

b. $19,000.

c. $40,000.

d. $21,000.

Solutions

Expert Solution

Answer to Question No. 11

Option b i.e. $898,000

Income from Continuing Operations = Sales Revenue – Cost of Goods Sold – Selling and Administrative Expenses – Loss on Sale of Investments – Loss on Impairment from Continuing Operations
Income from Continuing Operations = $6,220,000 - $3,800,000 - $1,260,000 - $200,000 - $62,000
Income from Continuing Operations = $898,000

Answer to Question No. 12

Option a i.e. $590,700

Cash Outflow for Salaries = Salaries Expense – Increase in Salaries Payable
Increase in Salaries Payable = $90,600 - $61,000
Increase in Salaries Payable = $29,600

Cash Outflow for Salaries = $620,300 - $29,600
Cash Outflow for Salaries = $590,700

Answer to Question No. 13

Option c i.e. $249,000

Cash Outflows for Rent = Rent Expense + Increase in Prepaid Rent
Increase in Prepaid Rent = $84,000 - $77,000 = $7,000

Cash Outflows for Rent = $242,000 + $7,000
Cash Outflows for Rent = $249,000

Answer to Question No. 14

Option a i.e. $122,000

Payment for Supplies = Supplies Expense + Increase in Supplies
Increase in Supplies = $39,000 - $27,000 = $12,000

Payment for Supplies = Supplies Expense + Increase in Supplies
$134,000 = Supplies Expense + $12,000
Supplies Expense = $122,000

Answer to Question No. 15

Option b i.e. $19,000

Beginning Utilities Payable, 2018 + Utilities Expense – Payment for Utilities = Ending Utilities Payable, 2018
Beginning Utilities Payable, 2018 + $165,000 - $144,000 = $40,000
Beginning Utilities Payable, 2018 = $19,000

ekkarill92 answered 1 year ago
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