ACC 557 WK 7 : 15 M/C QUESTIONS :
pavan1001Week 7 Quiz Questions
Multiple Choice Question 178 |
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To qualify as natural resources in the accounting sense, assets must be
A | replaceable. |
B | underground. |
C | of a mineral nature. |
D | physically extracted in operations. | |
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Multiple Choice Question 122 |
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Sargent Corporation bought equipment on January 1, 2013. The equipment cost $180,000 and had an expected salvage value of $30,000. The life of the equipment was estimated to be 6 years. The book value of the equipment at the beginning of the third year using straight-line depreciation would be
A | $180,000. |
B | $130,000. |
C | $150,000. |
D | $50,000. |
Multiple Choice Question 207 |
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Rooney Company incurred $420,000 of research and development cost in its laboratory to develop a patent granted on January 1, 2013. On July 31, 2013, Rooney paid $63,000 for legal fees in a successful defense of the patent. The total amount debited to Patents through July 31, 2013, should be:
A | $420,000. |
B | $63,000. |
C | $483,000. |
D | $357,000. | |
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Multiple Choice Question 92 |
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Useful life is expressed in terms of use expected from the asset under the
A | straight-line method. |
B | declining-balance method. |
C | units-of-activity method. |
D | none of these. |
Multiple Choice Question 114 |
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Moreno Company purchased equipment for $675,000 on January 1, 2012, and will use the double-declining-balance method of depreciation. It is estimated that the equipment will have a 3-year life and a $30,000 salvage value at the end of its useful life. The amount of depreciation expense recognized in the year 2014 will be
A | $75,000. |
B | $51,660. |
C | $45,000. |
D | $81,660. |
Multiple Choice Question 158 |
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The book value of an asset will equal its fair market value at the date of sale if
A | a gain on disposal is recorded. |
B | the plant asset is fully depreciated. |
C | no gain or loss on disposal is recorded. |
D | a loss on disposal is recorded. |
Multiple Choice Question 154 |
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If disposal of a plant asset occurs during the year, depreciation is
A | not recorded if the asset is scrapped. |
B | recorded for the fraction of the year to the date of the disposal. |
C | recorded for the whole year. |
D | not recorded for the year. |
Multiple Choice Question 141 |
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A major disadvantage resulting from the use of bonds is that
A | interest must be paid on a periodic basis. |
B | bondholders have voting rights. |
C | taxes may increase. |
D | earnings per share may be lowered. |
Multiple Choice Question 173 |
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A $600,000 bond was retired at 103 when the carrying value of the bond was $622,000. The entry to record the retirement would include a
A | gain on bond redemption of $18,000. |
B | gain on bond redemption of $4,000. |
C | loss on bond redemption of $18,000. |
D | loss on bond redemption of $12,000. |
Multiple Choice Question 199 |
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The 2013 financial statements of Marker Co. contain the following selected data (in millions).
| Current Assets | $75 |
| Total Assets | 140 |
| Current Liabilities | 40 |
| Total Liabilities | 95 |
| Cash | 8 |
The debt to total assets ratio is
A | 67.9%. |
B | 256%. |
C | 28.6%. |
D | 96.4%. |
On September 1, Joe's Painting Service borrows $100,000 from National Bank on a 4-month, $100,000, 6% note. What entry must Joe's Painting Service make on December 31 before financial statements are prepared?
A | Interest Expense2,000 Notes Payable2,000
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B | Interest Expense2,000 Interest Payable2,000
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C | Interest Payable2,000 Interest Expense2,000
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D | Interest Expense6,000 Interest Payable6,000
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Multiple Choice Question 65 |
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The relationship of current assets to current liabilities is used in evaluating a company's
A | long-range solvency. |
B | operating cycle. |
C | revenue-producing ability. |
D | short-term debt paying ability. |
Multiple Choice Question 160 |
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Each of the following accounts is reported as long-term liabilities except
A | Discount on Bonds Payable. |
B | Bonds Payable. |
C | Premium on Bonds Payable. |
D | Interest Payable. |
Multiple Choice Question 67 |
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In most companies, current liabilities are paid within
A | the operating cycle through the creation of other current liabilities. |
B | one year through the creation of other current liabilities. |
C | one year or the operating cycle out of current assets. |
D | the operating cycle out of current assets. |
Multiple Choice Question 157 |
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Hernandez Corporation issues 3,000, 10-year, 8%, $1,000 bonds dated January 1, 2013, at 98. The journal entry to record the issuance will show a
A | debit to Cash for $2,960,000. |
B | debit to Cash of $3,000,000. |
C | credit to Discount on Bonds Payable for $60,000. |
D | credit to Bonds Payable for $3,040,000. |
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