Q&A Hero

Q: when authorizing bonds to be issued, the board of directors does not specify the a.total number of bonds authorized to be sold b.contractual interest rate c.selling price d.total face value of the bonds

Q: Consider the following information taken from the cash account. Assume cash payments were 80% of collections. Cash??Beginning balance$115,375Deposits??Checks$80,275Ending balanceHow much was the beginning balance of the cash account? a. $57,200 b. $92,300 c. $103,350 d. $35,100

Q: A bank reconciliation should be prepared a. whenever the bank refuses to lend the company money b. to explain any difference between the balance per company records with the balance per bank records c. by the company's bank d. by the person who is authorized to sign checks

Q: the contractual rate of interest is usually stated as a(n) a.monthly rate b.daily rate c.semiannual rate d.annual rate

Q: Which of the following would be deducted from the balance per company records on a bank reconciliation? a. service charges b. outstanding checks c. deposits in transit d. notes collected by the bank

Q: which of the following statements concerning bonds is not a true statement? a.bonds are generally sold through an investment company b.the bond indenture is prepared after the bonds are printed c.the bond indenture and bond certificate are separate documents d.the trustee keeps records of each bondholder

Q: A $150 petty cash fund has cash of $54 and receipts of $83. The journal entry to replenish the account would include a a. credit to Petty Cash for $29 b. debit to Cash for $83 c. debit to Cash Short and Over for $13 d. credit to Cash for $54

Q: bonds are not always categorized as a.callable or convertible b.term or serial c.secured or unsecured d.secured or debenture

Q: The debit balance in Cash Short and Over at the end of an accounting period is reported as a. an expense on the income statement b. income on the income statement c. an asset on the balance sheet d. a liability on the balance sheet

Q: corporations are granted the power to issue bonds through a.tax laws b.state laws c.federal security laws d.bond debentures

Q: Gunnar Company gathered the following reconciling information in preparing its September bank reconciliation. Determine the adjusted balance on September 30.Cash balance per company records, September 30 $2,750Deposits in transit 200Notes receivable and interest collected by bank 630Bank charge for check printing 50Outstanding checks 1,250NSF check 290 a. $5,130 b. $3,690 c. $3,040 d. $1,590

Q: bonds that are issued against the general credit of the borrower are called a.callable bonds b.debenture bonds c.secured bonds d.term bonds

Q: bonds that are subject to retirement at a stated dollar amount prior to maturity at the option of the issuer are called a.callable bonds b.early retirement bonds c.options d.debentures

Q: Which of the following would not be included with the cash and cash equivalents on the balance sheet? a. commercial paper b. short-term receivables c. certificates of deposit d. money market mutual funds

Q: bonds that may be exchanged for common stock at the option of the bondholders are called a.options b.stock bonds c.convertible bonds d.callable bonds

Q: "To maintain public confidence and trust in the financial reporting of companies" is the purpose of a. the FASB b. the IRS c. Sarbanes-Oxley d. GAAP

Q: bonds that are secured by real estate are termed a.mortgage bonds b.serial bonds c.debentures d.convertible bonds

Q: The amount of deposits in transit is included on the bank reconciliation as a(n) a. deduction from the balance per the company records b. deduction from the balance per bank statement c. addition to the balance per bank statement d. addition to the balance per company records

Q: Receipts from cash sales of $3,200 were recorded incorrectly in the cash receipts journal as $2,300. This item would be included on the bank reconciliation as a(n) a. deduction from the balance per company's records b. addition to the balance per bank statement c. deduction from the balance per bank statement d. addition to the balance per company's records

Q: which of the following is not an advantage of issuing bonds instead of common stock? a.stockholder control is not affected b.earnings per share on common stock may be lower c.tax savings result d.each of the above is an advantage

Q: Minor Company had checks outstanding totaling $19,200 on its April bank reconciliation. In May, Minor Company issued checks totaling $64,900. The May bank statement shows that $47,600 in checks cleared the bank in May. A check of $300 from one of Minor Company's customers was also returned marked "NSF." The amount of outstanding checks on Minor Company's May bank reconciliation should be a. $28,400 b. $66,800 c. $17,300 d. $36,500

Q: stockholders of a company may be reluctant to finance expansion through issuing more equity because a.leveraging with debt is always a better idea b.their earnings per share may decrease c.the price of the stock will automatically decrease d.dividends must be paid on a periodic basis

Q: In the normal operation of business, you receive a check from a customer and deposit it into your checking account. With your bank statement, you are advised that this check for $775 is “NSF.” The bank also informs you that due to the amount of activity on your business account the monthly service charge is $75. During a bank reconciliation, you will a. subtract both values from the cash balance according to the bank statement b. add both values to the cash balance according to the company’s records c. add both values to the cash balance according to the bank statement d. subtract both values from the cash balance according to the company’s records

Q: a legal document that indicates the name of the issuer, the face value of the bond and such other data is called a.a bond certificate b.a bond debenture c.trading on the equity d.a convertible bond

Q: EFT a. means efficient funds transfer b. can process certain cash transactions at less cost than using the mail would incur c. makes it easier to document purchase and sale transactions d. means effective funds transfer

Q: secured bonds are bonds that a.are in the possession of a bank b.can be converted into common stock c.have specific assets of the issuer pledged as collateral d.mature in installments

Q: Which of the following would be subtracted from the balance per company records on a bank reconciliation? a. outstanding checks b. deposits in transit c. notes collected by the bank d. error in recording a check issued for $732 as $723

Q: if a corporation issued $6,000,000 in bonds which pay 5% annual interest, what is the annual net cash cost of this borrowing if the income tax rate is 30%? a.$3,000,000 b.$90,000 c.$300,000 d.$210,000

Q: Sarbanes-Oxley applies to a. publicly held companies b. not-for-profit organizations c. privately held businesses d. All of these choices

Q: from the standpoint of the issuing company, a disadvantage of using bonds as a means of long-term financing is that a.bond interest is deductible for tax purposes b.interest must be paid on a periodic basis regardless of earnings c.income to stockholders may increase as a result of trading on the equity d.the bondholders do not have voting rights

Q: Accompanying the bank statement was a credit memo for a short-term note collected by the bank for the company. This item is a(n) a. deduction from the balance per company's records b. addition to the balance per bank statement c. deduction from the balance per bank statement d. addition to the balance per company's records

Q: mohling company typically sells subscriptions on an annual basis, and publishes eight times a year. the magazine sells 60,000 subscriptions in january at $10 each. what entry is made in january to record the sale of the subscriptions?

Q: Procedures designed to protect cash from theft and misuse from the time it is received until it can be deposited in a bank are called a. accounting controls b. cash controls c. FASB controls d. GAAP controls

Q: 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?

Q: julie lambert has a large consulting practice. new clients are required to pay one-half of the consulting fees up front. the balance is paid at the conclusion of the consultation. how does lambert account for the cash received at the end of the engagement?

Q: A minimum cash balance required by a bank is called a. cash in bank b. a cash equivalent c. a compensating balance d. an EFT

Q: Which of the following is not a factor that influences a business's control environment? a. management's philosophy and operating style b. organizational structure c. proofs and security measures d. personnel policies

Q: two sisters operate a bed and breakfast on the coast of maine. as customers make reservations they are required to pay cash in advance equal to one-half of the rate for their stay. how should the sisters account for the cash received as reservations are made?

Q: A special form on which is recorded pertinent data about a liability and the particulars of its payment is called a(n) a. invoice b. voucher c. debit memo d. remittance advice

Q: the following totals for the month of march were taken from the payroll register of kern company.the entry to record the accrual of federal unemployment tax would include aa.credit to federal unemployment taxes payable for $288b.debit to federal unemployment taxes expense for $288c.credit to payroll tax expense for $288d.debit to federal unemployment taxes payable for $288

Q: Accompanying the bank statement was a debit memo for an NSF check received from a customer. This item would be included on the bank reconciliation as a(n) a. deduction from the balance per company's records b. addition to the balance per bank statement c. deduction from the balance per bank statement d. addition to the balance per company's records

Q: the following totals for the month of march were taken from the payroll register of kern company.the entry to record accrual of employers payroll taxes would include aa.debit to payroll tax expense for $4,320b.debit to payroll tax expense for $12,240c.credit to fica taxes payable for $2,232d.credit to payroll tax expense for $4,320

Q: Journal entries based on the bank reconciliation are required in the company's accounts for a. outstanding checks b. deposits in transit c. bank errors d. book errors

Q: the following totals for the month of march were taken from the payroll register of kern company.the entry to record the payment of net payroll would include aa.debit to salaries and wages expense for $23,238b.debit to salaries and wages payable for $25,326c.debit to salaries and wages payable for $23,238d.credit to cash for $23,238

Q: Thompson Company gathered the following reconciling information in preparing its October bank reconciliation. Determine the cash balance per company records (before adjustment) on June 30. Cash balance per bank, October 31 $17,000 Note receivable collected by bank 4,800 Outstanding checks 6,500 Deposits in transit 3,000 Bank service charge 50 NSF check 2,300 a. $11,050 b. $19,450 c. $15,950 d. $11,150

Q: the following totals for the month of march were taken from the payroll register of kern company.the journal entry to record the monthly payroll on march 30 would include aa.debit to salaries and wages payable for $23,238b.credit to salaries and wages payable for $25,326c.debit to salaries and wages expense for $36,000d.debit to salaries and wages expense for $23,238

Q: the following totals for the month of april were taken from the payroll register of metz company.the entry to record the accrual of federal unemployment tax would include aa.credit to federal unemployment taxes payable for $160b.credit to federal unemployment taxes expense for $160c.credit to payroll tax expense for $160d.debit to federal unemployment taxes payable for $160

Q: The objectives of internal control are to a. control the internal organization of the Accounting Department personnel and equipment b. provide reasonable assurance that assets are safeguarded and used for business purposes, financial reports are accurate, and laws and regulations are complied with c. prevent fraud and promote the social interest of the company d. provide control over "internal-use only" reports and employee internal conduct

Q: the following totals for the month of april were taken from the payroll register of metz company.the entry to record accrual of employers payroll taxes would include aa.debit to payroll tax expense for $2,693b.credit to payroll tax expense for $2,693c.credit to fica taxes payable for $1,160d.credit to payroll tax expense for $1,160

Q: The cash account in the company's ledger is a(n) a. asset with a normal debit balance b. asset with a normal credit balance c. liability with a normal debit balance d. liability with a normal credit balance

Q: the following totals for the month of april were taken from the payroll register of metz company.the entry to record the payment of net payroll would include aa.debit to salaries and wages payable for $12,107b.debit to salaries and wages payable for $13,267c.debit to salaries and wages payable for $12,267d.credit to cash for $12,267

Q: During the year, Tempo Inc. has monthly cash expenses of $115,000. On December 31, its cash balance is $1,437,500. The ratio of cash to monthly cash expenses is a. 8.0 months b. 12.5 months c. 87.5 months d. 11.5 months

Q: the following totals for the month of april were taken from the payroll register of metz company.the journal entry to record the monthly payroll on april 30 would include aa.debit to salaries and wages expense for $20,000b.credit to salaries and wages payable for $20,000c.debit to salaries and wages payable for $20,000d.debit to salaries and wages expense for $13,267

Q: Which of the following items that appeared on the bank reconciliation did not require a journal entry? a. bank service charges b. deposits in transit c. NSF checks d. a check for $630, recorded in the check register for $360

Q: keller company issued a five-year interest-bearing note payable for $100,000 on january 1, 2011. each january the company is required to pay $20,000 on the note. how will this note be reported on the december 31, 2012, balance sheet? a.long-term debt, $100,000 b.long-term debt, $80,000 c.long-term debt, $60,000; long-term debt due within one year, $20,000 d.long-term debt of $80,000; long-term debt due within one year, $20,000

Q: the following totals for the month of april were taken from the payroll register of noll company.the entry to record the accrual of federal unemployment tax would include aa.credit to federal unemployment taxes payable for $128b.debit to federal unemployment taxes expense for $128c.credit to payroll tax expense for $128d.debit to federal unemployment taxes payable for $128

Q: the following totals for the month of april were taken from the payroll register of noll company.the entry to record accrual of employers payroll taxes would include aa.debit to payroll tax expense for $992b.debit to payroll tax expense for $3,192c.credit to fica taxes payable for $4,400d.credit to payroll tax expense for $992

Q: The bank reconciliation a. should be prepared by an employee who records cash transactions b. is part of the internal control system c. is for information purposes only d. is sent to the bank for verification

Q: the following totals for the month of april were taken from the payroll register of noll company.the entry to record the payment of net payroll would include aa.debit to salaries and wages payable for $33,008b.debit to salaries and wages payable for $34,000c.debit to salaries and wages payable for $31,800d.credit to cash for $36,200

Q: Internal control does not consist of policies and procedures that a. protect assets from misuse b. ensure employees and managers comply with laws and regulations c. guarantee the company will earn a profit d. ensure that business information is accurate

Q: the following totals for the month of april were taken from the payroll register of noll company.the journal entry to record the monthly payroll on april 30 would include aa.debit to salaries and wages expense for $48,000b.credit to salaries and wages payable for $48,000c.debit to salaries and wages payable for $48,000d.debit to salaries and wages expense for $34,000

Q: Savannah Company gathered the following reconciling information in preparing its October bank reconciliation. Determine the adjusted balance on October 31.Balance per bank $16,750Balance per company records 16,125Bank service charges 80Deposit in transit 2,195NSF check 950Outstanding checks 3,850 a. $14,470 b. $10,705 c. $15,095 d. $15,720

Q: dominic's salon has total receipts for the month of $20,140 including sales taxes. if the sales tax rate is 6%, what are dominic's sales for the month? a.$18,932.20 b.$21,348.80 c.$19,000.00 d.it cannot be determined

Q: Jamison Company gathered the following reconciling information in preparing its June bank reconciliation. Determine the cash balance per company records (before adjustment) on June 30.Cash balance per bank, June 30 $13,000Note receivable collected by bank 4,000Outstanding checks 7,000Deposits in transit 2,500Bank service charge 35NSF check 1,900 a. $8,065 b. $10,565 c. $15,065 d. $6,435

Q: tina's boutique has total receipts for the month of $16,170 including sales taxes. if the sales tax rate is 5%, what are tina's sales for the month? a.$15,362 b.$15,400 c.$16,170 d.it cannot be determined

Q: A check drawn by a company for $340 in payment of a liability was recorded in the journal as $430. What entry is required in the company's accounts? a. debit Accounts Payable; credit Cash b. debit Cash; credit Accounts Receivable c. debit Cash; credit Accounts Payable d. debit Accounts Receivable; credit Cash

Q: norlan company does not ring up sales taxes separately on the cash register. total receipts for october amounted to $14,700. if the sales tax rate is 5%, what amount must be remitted to the state for october's sales taxes? a.$700 b.$735 c.$35 d.it cannot be determined

Q: Which of the following would be added to the balance per company records on a bank reconciliation? a. service charges b. outstanding checks c. deposits in transit d. notes collected by the bank

Q: morgan company does not ring up sales taxes separately on the cash register. total receipts for february amounted to $19,080. if the sales tax rate is 6%, what amount must be remitted to the state for february's sales taxes? a.$1,145 b.$1,080 c.$1,076 d.it cannot be determined

Q: Which of the following would be subtracted from the balance per bank on a bank reconciliation? a. outstanding checks b. deposits in transit c. notes collected by the bank d. service charges

Q: Al’s Bookstore has collected $750 in sales taxes during April. If sales taxes must be remitted to the state government monthly, what entry will Al's Bookstore make to show the April remittance?

Q: Which of the following should not be considered cash by an accountant? a. money orders b. bank checking accounts c. postage stamps d. travelers' checks

Q: A cash register tape shows cash sales of $2,000 and sales taxes of $160. The journal entry to record this information is

Q: Don's Pharmacy has collected $600 in sales taxes during March. If sales taxes must be remitted to the state government monthly, what entry will Don's Pharmacy make to show the March remittance?

Q: A bank reconciliation should be prepared periodically because a. the company's records and the bank's records are in agreement b. the bank has not recorded all of its transactions c. any differences between the company's records and the bank's records should be determined, and any errors made by either party should be discovered and corrected d. the bank must make sure that its records are correct

Q: A cash register tape shows cash sales of $5,000 and sales taxes of $250. The journal entry to record this information is

Q: A firm's internal control environment is not influenced by a. management's operating style b. organizational structure c. personnel policies d. monitoring policies

Q: sales taxes collected by a retailer are reported as a.contingent liabilities b.revenues c.expenses d.current liabilities

Q: The portion of an invoice that is returned with payment is a a. remittance advice b. voucher c. debit memo d. credit memo

Q: a retailer that collects sales taxes is acting as an agent for the a.wholesaler b.customer c.taxing authority d.chamber of commerce