Santa Clara University BrittC

Question 13 pts

BrittCo bought a building for new warehouse operations. It needs work. He’s tech savvy, so Britt knows he needs wiring for the computers he’ll be running. The roof was partially blown off in a storm. So that needs fixing. All interior rooms are painted green. Britt wants blue and will repaint. Which of the following statements is true?

Group of answer choices

a.)The cost of the building will include the cost of wiring and the roof.

b.)The cost of the building will include the repainting costs.

c.)The cost of the building is the purchase price of the building, while the additional expenditures are not warranted or capitalizable.

d.)The wiring is part of expense, not the building cost.

Flag question: Question 2

Question 23 pts

What happens to the income statement after an asset is fully depreciated?

Group of answer choices

a.) a reduction in future expense.

b.) difficult as the asset must be replaced expeditiously.

c.) a loss due to increased expenses.

d.) a credit balance to the AFDA.

Flag question: Question 3

Question 33 pts

Not all freight is paid by the buyer. When it is though, the amount of freight-in paid

Group of answer choices

a.)is a permanent account.

b.)is contra to the Purchases account.

c.)is added to the cost of inventory purchased.

d.)has a normal credit balance.

Flag question: Question 4

Question 43 pts

The Allowance for Doubtful Accounts is classified as a(n)

Group of answer choices

a.)asset account.

b.)contra asset account.

c.)expense account.

d.)contra revenue account.

Flag question: Question 5

Question 53 pts

Not all sales are for cash. What do the terms 3/15 and n45 describe?

Group of answer choices

a.)when title is transferred.

b.) an expected rate of return on Accounts Receivable.

c.)the standard shipping terms.

d.)an early payment incentive.

Flag question: Question 6

Question 63 pts

Chad Corp. purchased land for $250,000 cash for a building valued at $300,000. Real estate brokers’ commission was $15,000 and $4,000 was spent for demolishing an old building on the land before land could be used. Under the cost principle, the cost of land would be recorded at

Group of answer choices

a.)$300,000.

b.)$269,000.

c.)$265,000.

d.)$250,000.

Flag question: Question 7

Question 73 pts

Kaia makes and sells crispy treats. She purchased 600 pounds of cornflakes for $500. Freight cost to her production facility was $50 for the barrel of cornflakes shipped FOB destination. She paid $75 for other ingredients and also paid $25 for 100 one-pound biodegradable plastic bags into which the product is placed. The cost of her one-pound bag of treats is:

Group of answer choices

a.)$1.00.

b.)$1.25.

c.)$1.60.

d.)$1.75.

Flag question: Question 8

Question 83 pts

One of these is false regarding diluted earnings per share. Which one?

Group of answer choices

a.)Reporting diluted earnings per share is required by GAAP when dilution of EPS exists.

b.)Diluted earnings per share can be used to reflect the extent of potential share dilution.

c.)Diluted earnings per share is not reported by some companies.

d.)Diluted earnings per share is always the same as basic earnings per share.

Flag question: Question 9

Question 93 pts

When writing journal entries for recording assets, what is the end result in the account:

Group of answer choices

a.)Proceeds paid.

b.)Cost, net of preparation costs.

c.)Net depreciable costs.

d.)Aggregate cost.

Flag question: Question 10

Question 103 pts

Most Cost of Goods is generated at point of journal entry. How do you compute it manually?

Group of answer choices

a.)beginning inventory – cost of goods purchased + ending inventory.

b.)sales – cost of goods purchased + beginning inventory – ending inventory.

c.)sales + gross profit – ending inventory + beginning inventory.

d.)beginning inventory + cost of goods purchased – ending inventory

Flag question: Question 11

Question 113 pts

The Balance Sheet has ending inventory. In periods of rising prices, the method giving the inventory value at closest to current cost is which?

Group of answer choices

a.)FIFO method.

b.)LIFO method.

c.)average-cost method.

d.)tax method.

Flag question: Question 12

Question 123 pts

An income statement may have Comprehensive Income. What could that be?

Group of answer choices

a.)Foreign currency translation, unrealized gains on investments, goodwill

b.)Amortization of intangibles, Foreign currency translation, unrealized gains on investments

c.)Foreign currency translation, unrealized gains on investments, pension gains or losses

d.)Items with deeper impact than regular income

Flag question: Question 13

Question 133 pts

A receivable is written off. What happens net receivables under the Allowance method?

Group of answer choices

a.)will increase due to bad account being eliminated.

b.)will decrease as the allowance amount goes down.

c.)remains the same.

d.)will increase based on allowance account going up.

Flag question: Question 14

Question 143 pts

To be considered a Cash and cash equivalent, the account must hold:

Group of answer choices

a.)Checking account, petty cash, certificate of deposit bought 3/1/XX, due 5/15/XX, note due in 120 days.

b.)Checking accounts, petty cash, certificates of deposit bought 3/1/XX, due 7/31/XX.

c.)Checking account, petty cash, certificate of deposit bought 3/1/XX, due 5/15/XX, note due in 75 days.

d.)Checking account, petty cash, certificate of deposit bought 3/1/XX, due 5/15/XX

Flag question: Question 15

Question 154 pts

ChadCo disposes of some equipment at the end of 4 years. It had a 5-year useful life. The cost was $520,000, with salvage value estimated at $20,000. He used the straight-line method to depreciate. He was lucky and got some cash for selling it. $32,000. What’s the complete journal entry for the sale?

Note: Make sure to format your entries properly, whether you are using a table or plain text entry.

Flag question: Question 16

Question 165 pts

VNN, Inc. sold product to Kona, Inc. for $110,000 at 3/10, net 15. Inventory costs were $30,000. Record the journal entries VNN would record just at the time of sale.

Note: Make sure to format your entries properly, whether you are using a table or plain text entry.

Flag question: Question 17

Question 176 pts

Make sure to answer BOTH parts of the question below.

Kaia Co is reviewing inventory at the end of the period. She sees the following cost and market data at 12/31/XX.

Product

Cost

Market

Silicon part 48z35

$23,000

$35,000

Silicon part 48y75

$18,000

$12,000

Silicon part 47g44

$74,000

$61,000

Silicon part 32b12

$56,000

$48,000

total

$171,000

A. What, if any, is the amount of the lower cost or market adjustment?

B. What is the journal entry to record the adjustment?

Note: Make sure to format your entries properly, whether you are using a table or plain text entry.

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Flag question: Question 18

Question 1816 pts

Here we take a look at depreciating long lived assets. CMK’s Surfing Company purchased a brand new board shaper for $295,000. The oven was shipped from Australia at a cost of $25,000 and while importing it, CMK paid $4,000 in foreign fees. The shaper also had to be mounted in a permanent housing at a cost of $6,000. It is estimated that the machine will have a $30,000 salvage value at the end of its 4-year useful service life. The maximum estimated board production is 30,000 boards: 10,000 in year one, 9,000 in year two, 7,000 in year three, and 4,000 in year four, respectively.

Instructions: Compute the total cost, then using the straight line and units of activity methods, prepare a schedule that shows the 1) annual depreciation expense, 2) annual accumulated depreciation, and 3) net book value on the machine for each of the years in its 4-year life.

Important: Do NOT enter dollar signs, extra spaces, punctuation, or trailing zeroes. For example, enter $100,000 as 100

Depreciation Expense

(in thousands of dollars)

Accumulated Depreciation

(in thousands of dollars)

Net Book Value

(in thousands of dollars)

S/L

Yr 1

Yr 2

Yr 3

Yr 4

Activity

Yr 1

Yr 2

Yr 3

Yr 4

Flag question: Question 19

Question 1912 pts

BJN had the following purchases and sales during September.

On Sept. 3, he purchased 60 units at $52.

On Sept. 10, he purchased 210 units at $57.

On Sept. 17, he purchased 40 units at $60.

On Sept. 25 he sold 345 units.

Note that on Sept 1, BJN had beginning inventory of 110 units that were purchased at $42 per unit.

Instructions: Using the inventory and sales data above, calculate the value assigned to cost of goods sold in March and to the ending inventory at March 31 using (a) FIFO, (b) LIFO, and (c) Average cost.

Important: Do NOT enter dollar signs or punctuation. For example, enter $5,500 as 5500

A. FIFO

Cost of goods sold $

Ending inventory $

B. LIFO

Cost of goods sold $

Ending inventory $

C. Average

Cost of goods sold $

Ending inventory $

Flag question: Question 20

Question 204 pts

Let’s take a look at some Intangible assets. First, identify the period of amortization. Then, if there is no period of amortization, state why.

Patents

Copyrights

Trademarks

Goodwill

Flag question: Spacer

Questions 21-24

Use the following information to answer the next four questions.

BVC Supplies Inc. sells exercise equipment. BVC notes that at December 31, 20XX, it has the following aging schedule of Accounts Receivable. 20XX Sales were $6,000,000. The amount in the allowance account at 12/31/XX is a credit balance of $15,500, prior to the review.

Total

Current

1–30

31–60

61–90

Over 90

Accounts receivable

$1,100,000

800,000

150,000

75,000

50,000

25,000

% uncollectible

1%

5%

10%

20%

50%

Flag question: Question 21

Question 216 pts

Important: Do NOT enter dollar signs or punctuation. For example, enter $5,500 as 5500

A. Net receivables using aging method (after adjustment):

B. Bad debt expense to be recorded using aging method:

Flag question: Question 22

Question 226 pts

Important: Do NOT enter dollar signs or punctuation. For example, enter $5,500 as 5500

A. What would the bad debt expense be using the sales method instead of aging method, if the expected uncollectible rate was 2.0%?

B. Net receivables using the sales method (after adjustment):

Flag question: Question 23

Question 232 pts

BVC wrote off a $20,000 receivable on 11/15/XX. Record the journal entry for the write-off.

Note: Make sure to format your entries properly, whether you are using a table or plain text entry.

Flag question: Question 24

Question 244 pts

On January 29, 20XY, BVC collected cash for a $8,000 receivable previously written off. Record the appropriate entries.

Note: Make sure to format your entries properly, whether you are using a table or plain text entry.

Flag question: Question 25

Question 2518 pts

This question has four parts. Make sure you enter your answers for all four questions.

The following information is available from certain balance sheet and all income statement general ledger accounts for Markai Co., a Delaware Corporation, for the fiscal year ended September 30, 20XX:

Cost of Goods Sold 900,000

Patents Capitalized 60,000

Sales Returns 50,000

Product Sales 2,000,000

Allowance for Doubtful Accounts 100,000

Trademarks 15,000

Sales Department expenses 190,000

Engineering Expenses 400,000

Accounts Payable 65,000

Losses on division scheduled for closing 50,000 before tax.

G&A Expenses 110,000

Goodwill 150,000

Marketing Department Expenses 180,000

Sales Discounts 15,000

Sales Tax Payable 5,000

Tax rate 30%

Copyrights 30,000

Interest Expense 12,000

Gain on investments 7,000

Contributed Capital 300,000

Wages payable 100,000

There are 900,000 average common shares outstanding and 100,000 equivalent shares.

A. Using only the income statement accounts, prepare a proper income statement.

Don’t forget to include section captions, properly labeled totals, and subtotals. If you have done this properly, you should have 22 rows. You can use a table or a plain text entry, or you can copy/paste your statement from another program such as Microsoft Word or Excel.

B. What is the Gross Margin %?

C. What is Basic EPS? Round to the nearest cent.

D. What is Diluted EPS? Round to the nearest cent.

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