Question 1

The current portion of long-term debt should

Accepted Answer

A) be paid immediately. 
B) be reclassified as a current liability. 
C) be classified as a long-term liability. 
D) not be separated from the long-term portion of debt. 
A) be paid immediately. 
B) be reclassified as a current liability. 
C) be classified as a long-term liability. 
D) not be separated from the long-term portion of debt.

Question 2

The following partial amortization schedule is available for Courtney Company who sold $750,000, five-year, 10% bonds on January 1, 2020, for $780,000 and uses annual straight-line amortization.   Which of the following amounts should be shown in cell (i)?

Accepted Answer

A) $78,000 
B) $81,000 
C) $75,000 
D) $15,000 
A) $78,000 
B) $81,000 
C) $75,000 
D) $15,000

Question 3

Gomez Corporation issues 900, 10-year, 8%, $1,000 bonds dated January 1, 2020, at 96.The journal entry to record the issuance will show a

Accepted Answer

A) debit to Cash of $900,000. 
B) credit to Discount on Bonds Payable for $36,000. 
C) credit to Bonds Payable for $864,000. 
D) debit to Cash for $864,000. 
A) debit to Cash of $900,000. 
B) credit to Discount on Bonds Payable for $36,000. 
C) credit to Bonds Payable for $864,000. 
D) debit to Cash for $864,000.

Question 4

Sparks Company received proceeds of $634,500 on 10-year, 8% bonds issued on January 1, 2019.The bonds had a face value of $600,000, pay interest annually on December 3t, and have a call price of 102.Sparks uses the straight-line method of amortization.Sparks Company decided to redeem the bonds on January 1, 2021.What amount of gain or loss would Sparks report on their 2021 income statement?

Accepted Answer

A) $27,600 gain 
B) $15,600 gain 
C) $15,600 loss 
D) $27,600 loss 
A) $27,600 gain 
B) $15,600 gain 
C) $15,600 loss 
D) $27,600 loss

Question 5

Which of the following is not a current liability on December 31, 2022?

Accepted Answer

A) A Note Payable due December 31, 2023 
B) An Accounts Payable due January 31, 2023 
C) A lawsuit judgment to be decided on January 10, 2023 
D) Accrued salaries payable from 2022 
A) A Note Payable due December 31, 2023 
B) An Accounts Payable due January 31, 2023 
C) A lawsuit judgment to be decided on January 10, 2023 
D) Accrued salaries payable from 2022

Question 6

Winrow Company received proceeds of $754,000 on 10-year, 8% bonds issued on January 1, 2019.The bonds had a face value of $800,000, pay interest annually on December 31, and have a call price of 101.Winrow uses the straight-line method of amortization.What is the carrying value of the bonds on January 1, 2021?

Accepted Answer

A) $800,000 
B) $763,200 
C) $790,800 
D) $758,600 
A) $800,000 
B) $763,200 
C) $790,800 
D) $758,600

Question 7

Metropolitan Symphony sells 200 season tickets for $40,000 that includes a five-concert season.The amount of Unearned Ticket Revenue after the third concert is $24,000.

Accepted Answer

A) True 
 B)False

Question 8

A retail store credited the Sales Revenue account for the sales price and the amount of sales tax on sales.If the sales tax rate is 5% and the balance in the Sales Revenue account amounted to $630,000, what is the amount of the sales taxes owed to the taxing agency?

Accepted Answer

A) $600,000 
B) $630,000 
C) $31,500 
D) $30,000 
A) $600,000 
B) $630,000 
C) $31,500 
D) $30,000

Question 9

Generally, convertible bonds do not pay interest.

Accepted Answer

A) True 
 B)False

Question 10

The adjusted trial balance for Hamilton Corp.at the end of the current year contained the following accounts.   The total long-term liabilities reported on the balance sheet are

Accepted Answer

A) $1,965,000 
B) $1,950,000 
C) $2,065,000 
D) $2,050,000 
A) $1,965,000 
B) $1,950,000 
C) $2,065,000 
D) $2,050,000

Question 11

When a business sells an item and collects a state sales tax on it, a current liability arises.

Accepted Answer

A) True 
 B)False

Question 12

Madson Company typically sells subscriptions on an annual basis and publishes six times a year.The magazine sells 90,000 subscriptions in January at $10 each.What entry is made in January to record the sale of the subscriptions?

Accepted Answer

The answer of Madson Company typically sells subscriptions on an...

Question 13

If the straight-line method of amortization is used, the amount of unamortized premium on bonds payable will decrease as the bonds approach maturity.

Accepted Answer

A) True 
 B)False

Question 14

If the market rate of interest is lower than the contractual interest rate, the bonds will sell at

Accepted Answer

A) face value. 
B) a premium. 
C) a discount. 
D) an unknown amount. 
A) face value. 
B) a premium. 
C) a discount. 
D) an unknown amount.

Question 15

If bonds are issued at a discount, the issuing corporation will pay a principal amount less than the face amount of the bonds on the maturity date.

Accepted Answer

A) True 
 B)False

Question 16

Morgan Company does not ring up sales taxes separately on the cash register.Total receipts for February amounted to $38,160.If the sales tax rate is 6%, what amount must be remitted to the state for February's sales taxes?

Accepted Answer

A) $2,290 
B) $2,160 
C) $2,152 
D) It cannot be determined. 
A) $2,290 
B) $2,160 
C) $2,152 
D) It cannot be determined.

Question 17

Convertible bonds are often called callable bonds.

Accepted Answer

A) True 
 B)False

Question 18

Dominic's Salon has total receipts for the month of $40,280 including sales taxes.If the sales tax rate is 6%, what are Dominic's sales for the month?

Accepted Answer

A) $37,864.40 
B) $42,697.60 
C) $38,000.00 
D) It cannot be determined. 
A) $37,864.40 
B) $42,697.60 
C) $38,000.00 
D) It cannot be determined.

Question 19

The following totals for the month of April were taken from the payroll records of Noll Company.   The entry to record the payment of net payroll would include a

Accepted Answer

A) debit to Salaries and Wages Payable for $79,160. 
B) debit to Salaries and Wages Payable for $81,320. 
C) debit to Salaries and Wages Payable for $72,140. 
D) credit to Cash for $90,500. 
A) debit to Salaries and Wages Payable for $79,160. 
B) debit to Salaries and Wages Payable for $81,320. 
C) debit to Salaries and Wages Payable for $72,140. 
D) credit to Cash for $90,500.

Question 20

Bond interest paid by a corporation is an expense, whereas dividends paid are not an expense of the corporation.

Accepted Answer

A) True 
 B)False

The current portion of long-term debt should

The following partial amortization schedule is available for Courtney Company who sold $750,000, five-year, 10% bonds on January 1, 2020, for $780,000 and uses annual straight-line amortization. Which of the following amounts should be shown in cell (i)?

Gomez Corporation issues 900, 10-year, 8%, $1,000 bonds dated January 1, 2020, at 96.The journal entry to record the issuance will show a

Which of the following is not a current liability on December 31, 2022?

Metropolitan Symphony sells 200 season tickets for $40,000 that includes a five-concert season.The amount of Unearned Ticket Revenue after the third concert is $24,000.

A retail store credited the Sales Revenue account for the sales price and the amount of sales tax on sales.If the sales tax rate is 5% and the balance in the Sales Revenue account amounted to $630,000, what is the amount of the sales taxes owed to the taxing agency?

Generally, convertible bonds do not pay interest.

The adjusted trial balance for Hamilton Corp.at the end of the current year contained the following accounts. The total long-term liabilities reported on the balance sheet are

When a business sells an item and collects a state sales tax on it, a current liability arises.

Madson Company typically sells subscriptions on an annual basis and publishes six times a year.The magazine sells 90,000 subscriptions in January at $10 each.What entry is made in January to record the sale of the subscriptions?

If the straight-line method of amortization is used, the amount of unamortized premium on bonds payable will decrease as the bonds approach maturity.

If the market rate of interest is lower than the contractual interest rate, the bonds will sell at

If bonds are issued at a discount, the issuing corporation will pay a principal amount less than the face amount of the bonds on the maturity date.

Morgan Company does not ring up sales taxes separately on the cash register.Total receipts for February amounted to $38,160.If the sales tax rate is 6%, what amount must be remitted to the state for February's sales taxes?

Convertible bonds are often called callable bonds.

Dominic's Salon has total receipts for the month of $40,280 including sales taxes.If the sales tax rate is 6%, what are Dominic's sales for the month?

The following totals for the month of April were taken from the payroll records of Noll Company. The entry to record the payment of net payroll would include a

Bond interest paid by a corporation is an expense, whereas dividends paid are not an expense of the corporation.

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Understanding Investments in Debt and Equity Securities

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Exam 10: Reporting and Analyzing Liabilities

The current portion of long-term debt should

The following partial amortization schedule is available for Courtney Company who sold $750,000, five-year, 10% bonds on January 1, 2020, for $780,000 and uses annual straight-line amortization. Which of the following amounts should be shown in cell (i)?

Gomez Corporation issues 900, 10-year, 8%, $1,000 bonds dated January 1, 2020, at 96.The journal entry to record the issuance will show a

Which of the following is not a current liability on December 31, 2022?

Metropolitan Symphony sells 200 season tickets for $40,000 that includes a five-concert season.The amount of Unearned Ticket Revenue after the third concert is $24,000.

A retail store credited the Sales Revenue account for the sales price and the amount of sales tax on sales.If the sales tax rate is 5% and the balance in the Sales Revenue account amounted to $630,000, what is the amount of the sales taxes owed to the taxing agency?

Generally, convertible bonds do not pay interest.

The adjusted trial balance for Hamilton Corp.at the end of the current year contained the following accounts. The total long-term liabilities reported on the balance sheet are

When a business sells an item and collects a state sales tax on it, a current liability arises.

Madson Company typically sells subscriptions on an annual basis and publishes six times a year.The magazine sells 90,000 subscriptions in January at $10 each.What entry is made in January to record the sale of the subscriptions?

If the straight-line method of amortization is used, the amount of unamortized premium on bonds payable will decrease as the bonds approach maturity.

If the market rate of interest is lower than the contractual interest rate, the bonds will sell at

If bonds are issued at a discount, the issuing corporation will pay a principal amount less than the face amount of the bonds on the maturity date.

Morgan Company does not ring up sales taxes separately on the cash register.Total receipts for February amounted to $38,160.If the sales tax rate is 6%, what amount must be remitted to the state for February's sales taxes?

Convertible bonds are often called callable bonds.

Dominic's Salon has total receipts for the month of $40,280 including sales taxes.If the sales tax rate is 6%, what are Dominic's sales for the month?

The following totals for the month of April were taken from the payroll records of Noll Company. The entry to record the payment of net payroll would include a

Bond interest paid by a corporation is an expense, whereas dividends paid are not an expense of the corporation.

Introduction to Financial Statements

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Understanding Investments in Debt and Equity Securities

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