Question 1

Accepted Answer

a. 2
b. 1
c. 1
d. 1

Question 2

Match between columns
                        Premises: Verification of payroll calculations.
Employee signs receipt acknowledging cash received.
Posting job openings.
Screening and interviewing of job applicants.
Use of a timeclock.
Maintenance of payroll records.
Supervisor approves hours worked.
Employment authorization.
Signing prenumbered payroll checks.
Documentation of employee hiring.
Distribution of checks by the treasurer.
Payroll tax return preparation.

Accepted Answer

The Answer of H = Hiring Employees and PRE = is...

Question 3

If a transaction cannot be recorded in a special journal

Accepted Answer

A)  the company must refuse to enter into the transaction. 
B)  it is recorded in the general journal. 
C)  it is recorded directly in the accounts in the general ledger. 
D)  it is recorded as an adjustment on the work sheet. 
A)  the company must refuse to enter into the transaction. 
B)  it is recorded in the general journal. 
C)  it is recorded directly in the accounts in the general ledger. 
D)  it is recorded as an adjustment on the work sheet.

Question 4

After Artie Company had completed all posting for the month of December, the sum of the balances in the following accounts payable subsidiary ledger did not agree with the balance of the control account in the general ledger.

The balance in the Accounts Payable control account of $37,380 has been verified as correct. Also assume that the journals references in the Post Ref. columns of the accounts payable subsidiary ledger have been verified as correct.
Instructions
Determine the errors in the preceding accounts payable subsidiary accounts and prepare a corrected schedule of accounts payable.

Accepted Answer

IDENTIFICATION OF ERRORS:
Carson Company

Question 5

The "Other Accounts" column in a cash receipts journal is also referred to as the

Accepted Answer

A)  miscellaneous column. 
B)  excess column. 
C)  sundry accounts column. 
D)  compound-entry column. 
A)  miscellaneous column. 
B)  excess column. 
C)  sundry accounts column. 
D)  compound-entry column.

Question 6

The employer incurs a payroll tax expense equal to the amount withheld from the employees' wages for federal income taxes.

Accepted Answer

A) True 
 B)False

Question 7

Marin Company sells 9,000 units of its product in 2014 for $500 each. The selling price includes a one-year warranty on parts. It is expected that 3% of the units will be defective and that repair costs will average $50 per unit. In the year of sale, warranty contracts are honored on 180 units for a total cost of $9,000. What amount should Marin Company report as Warranty Expense in its 2014 income statement?

Accepted Answer

A)  $13,500. 
B)  $9,000. 
C)  $4,500. 
D)  $67,500. 
A)  $13,500. 
B)  $9,000. 
C)  $4,500. 
D)  $67,500.

Question 8

The accounting for warranty costs is based on the

Accepted Answer

A)  going concern assumption. 
B)  expense recognition principle. 
C)  economic entity principle. 
D)  fair value principle. 
A)  going concern assumption. 
B)  expense recognition principle. 
C)  economic entity principle. 
D)  fair value principle.

Question 9

A subsidiary ledger is

Accepted Answer

A)  used in place of the general ledger if the general ledger is destroyed or stolen. 
B)  a group of accounts used by branches and subsidiaries of a corporate business. 
C)  a group of accounts with a common characteristic that provides detailed information about a control account in the general ledger. 
D)  used to post excess transactions if a general ledger account becomes full during an accounting period. 
A)  used in place of the general ledger if the general ledger is destroyed or stolen. 
B)  a group of accounts used by branches and subsidiaries of a corporate business. 
C)  a group of accounts with a common characteristic that provides detailed information about a control account in the general ledger. 
D)  used to post excess transactions if a general ledger account becomes full during an accounting period.

Question 10

Which of the following discount rates will produce the smallest present value?

Accepted Answer

A)  8% 
B)  9% 
C)  10% 
D)  4% 
A)  8% 
B)  9% 
C)  10% 
D)  4%

Question 11

The state unemployment tax rate is usually 5.4% on the first $7,000 of wages paid to an employee during the year.

Accepted Answer

A) True 
 B)False

Question 12

A contingency liability that is remote

Accepted Answer

A)  should be disclosed in the financial statements. 
B)  must be accrued as a loss. 
C)  does not need to be disclosed. 
D)  is recorded as a contingent liability. 
A)  should be disclosed in the financial statements. 
B)  must be accrued as a loss. 
C)  does not need to be disclosed. 
D)  is recorded as a contingent liability.

Question 13

Entries in a sales journal

Accepted Answer

A)  are made from sales invoices. 
B)  will indicate the invoice number in the reference column of the sales journal. 
C)  will occupy two lines of the sales journal. 
D)  indicate either a cash debit or accounts receivable debit. 
A)  are made from sales invoices. 
B)  will indicate the invoice number in the reference column of the sales journal. 
C)  will occupy two lines of the sales journal. 
D)  indicate either a cash debit or accounts receivable debit.

Question 14

Gable's Wholesale uses a sales journal. An entry in this journal represents a

Accepted Answer

A)  debit to Cash; credit to Sales Revenue. 
B)  debit to Accounts Receivable; credit to Sales Revenue. 
C)  debit to Sales Discounts; credit to Cash. 
D)  debit to Accounts Payable; credit to Sales Returns and Allowances. 
A)  debit to Cash; credit to Sales Revenue. 
B)  debit to Accounts Receivable; credit to Sales Revenue. 
C)  debit to Sales Discounts; credit to Cash. 
D)  debit to Accounts Payable; credit to Sales Returns and Allowances.

Question 15

The entries in a sales journal will show

Accepted Answer

A)  all sales of merchandise. 
B)  the cash sales of the company. 
C)  the credit sales of merchandise. 
D)  all sales of the company. 
A)  all sales of merchandise. 
B)  the cash sales of the company. 
C)  the credit sales of merchandise. 
D)  all sales of the company.

Question 16

The total of the individual account balances in the accounts receivable subsidiary ledger should agree with the total of the individual account balances in the accounts payable subsidiary ledger.

Accepted Answer

A) True 
 B)False

Question 17

The reference column of the accounts in the accounts payable subsidiary ledger after posting may show

Accepted Answer

A)  only P references. 
B)  CP, P, or G references. 
C)  G, P, or S references. 
D)  only CP references. 
A)  only P references. 
B)  CP, P, or G references. 
C)  G, P, or S references. 
D)  only CP references.

Question 18

Sam Myers sells televisions with a 2-year warranty. Past experience indicates that 2% of the units sold will be returned during the warranty period for repairs. The average cost of repairs under warranty is estimated to be $75 per unit. During 2014, 9,000 units were sold at an average price of $400. During the year, repairs were made on 50 units at a cost of $3,900.
Instructions
Prepare journal entries to record the repairs made under warranty and estimated warranty expense for the year.

Accepted Answer

The answer of Sam Myers sells televisions with a 2-year...

Question 19

A cash receipts journal can be used to record all transactions involving cash coming into the business, regardless of the source.

Accepted Answer

A) True 
 B)False

Question 20

If a certain type of transaction occurs with great frequency, it is more efficient to create a ______________ to record that type of transaction.

Accepted Answer

The answer of If a certain type of transaction occurs...

If a transaction cannot be recorded in a special journal

The "Other Accounts" column in a cash receipts journal is also referred to as the

The employer incurs a payroll tax expense equal to the amount withheld from the employees' wages for federal income taxes.

The accounting for warranty costs is based on the

A subsidiary ledger is

Which of the following discount rates will produce the smallest present value?

The state unemployment tax rate is usually 5.4% on the first $7,000 of wages paid to an employee during the year.

A contingency liability that is remote

Entries in a sales journal

Gable's Wholesale uses a sales journal. An entry in this journal represents a

The entries in a sales journal will show

The total of the individual account balances in the accounts receivable subsidiary ledger should agree with the total of the individual account balances in the accounts payable subsidiary ledger.

The reference column of the accounts in the accounts payable subsidiary ledger after posting may show

A cash receipts journal can be used to record all transactions involving cash coming into the business, regardless of the source.

If a certain type of transaction occurs with great frequency, it is more efficient to create a ______________ to record that type of transaction.

Accounting in Action

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Share Transactions, Dividends, and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 15: Accounting Principles and Contingent Liabilities in Business Operations

If a transaction cannot be recorded in a special journal

The "Other Accounts" column in a cash receipts journal is also referred to as the

The employer incurs a payroll tax expense equal to the amount withheld from the employees' wages for federal income taxes.

The accounting for warranty costs is based on the

A subsidiary ledger is

Which of the following discount rates will produce the smallest present value?

The state unemployment tax rate is usually 5.4% on the first $7,000 of wages paid to an employee during the year.

A contingency liability that is remote

Entries in a sales journal

Gable's Wholesale uses a sales journal. An entry in this journal represents a

The entries in a sales journal will show

The total of the individual account balances in the accounts receivable subsidiary ledger should agree with the total of the individual account balances in the accounts payable subsidiary ledger.

The reference column of the accounts in the accounts payable subsidiary ledger after posting may show

A cash receipts journal can be used to record all transactions involving cash coming into the business, regardless of the source.

If a certain type of transaction occurs with great frequency, it is more efficient to create a ______________ to record that type of transaction.

Accounting in Action

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Share Transactions, Dividends, and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

Filters