

Bennie Razor Company has decided to sell one of its old manufacturing machines on June 30, 2017. The machine was purchased
for $80,000 on January 1, 2013 and was depreciated on a straight-line basis for 10 years assuming no salvage value. If the
machine was sold for $26,000, what was the amount of the gain or loss recorded at the time of the sale?
(do khấu hao 10 năm là hết giá tri5 nên ta phải tính giá trị còn lại sau khi sử dụng – đi giá bán mot bt tang giam bao
nhiu 80000/10 x 4.5(sài 4.5 năm) = số năm đã sài =36000 (Accumulated Depreciation)

Net Book Value = $80,000 - $36,000 = $44,000 giá tri con lai cua máy

(a) $18,000.
(b) $54,000.
(c) $22,000.
(d) $46,000.
 
 Question 2
10 out of 10 points
Sammy Corporation reported net sales of $300,000, $330,000, and $360,000 in the years, 2015, 2016, and 2017, respectively.
If 2015 is the base year, what is the trend percentage for 2017?
(a) 77%. (c) 120%.
(b) 108%. (d) 130%.

(360-300)/300 x 100% =

 Question 3
10 out of 10 points
At December 31, Hanes Company prepares an adjusting entry for a product warranty contract.
Which of the following accounts is/are included in the entry?
(a) Miscellaneous Expense. (c) Repair Parts.
(b) Warranty Liability.          (d) Both (a) and (b).

 Question 4
10 out of 10 points
Which of the following should not be included in the physical inventory of a company?

(a) Goods held on consignment from another company.

(b) Goods shipped on consignment to another company.
(c) Goods in transit from another company shipped FOB shipping point.
(d) None of the above.

 Question 5
10 out of 10 points
Maggie Sharrer Company borrows $88,500 on September 1, 2021, from Sandwich State Bank by signing an $88,500, 12%,
one-year note. What is the accrued interest at December 31, 2021?
(a) $2,655. (c) $4,425.
(b) $3,540. (d) $10,620.

 Question 6
0 out of 10 points
 One of the following statements about promissory notes is incorrect. The incorrect statement is:
(a) The party making the promise to pay is called the maker.
(b) The party to whom payment is to be made is called the payee.
(c) A promissory note is not a negotiable instrument.
(d) A promissory note is often required from high-risk customers.

 Question 7
10 out of 10 points
Cost of goods available for sale consists of two elements: beginning inventory and
(a) ending inventory.
(b) cost of goods purchased.
(c) cost of goods sold.
(d) All of the answer choices are correct.

 Question 8
0 out of 10 points
An analysis and aging of the accounts receivable of Prince Company at December 31 reveals the following data.
Accounts receivable $800,000
Allowance for doubtful accounts per books before adjustment 50,000

Amounts expected to become uncollectible 65,000

The cash realizable value of the accounts receivable at  
December 31, after adjustment, is:  
(a) $685,000. (c) $800,000.
(b) $750,000. (d) $735,000.

 Question 9
10 out of 10 points
Buehler Company on June 15 sells merchandise on account to Chaz Co. for $1,000, terms 2/10, n/30. On June 20, Chaz Co.
returns merchandise worth $300 to Buehler Company. On June 24, payment is received from Chaz Co. for the balance due.
What is the amount of cash received?
(a) $700.
(b) $680.
(c) $686.
(d) None of the above

 Question 10
10 out of 10 points
When recording payroll:
(a) gross earnings are recorded as salaries and wages payable.
(b) net pay is recorded as salaries and wages expense.
(c) payroll deductions are recorded as liabilities.
(d) More than one of the above.

 Question 11
10 out of 10 points
Able Towing Company purchased a tow truck for $60,000 on January 1, 2021. It was originally depreciated on a straight-line
basis over 10 years with an assumed salvage value of $12,000. On December 31, 2021, before adjusting entries had been
made, the company decided to change the remaining estimated life to 4 years (including 2021) and the salvage value to
$2,000. What was the depreciation expense for 2021?
(a) $6,000.
 (b) $4,800.
(c) $15,000.
(d) $12,100.

 Question 12
10 out of 10 points
. In 2021, Roso Carlson Company had net credit sales of $750,000. On January 1, 2021, Allowance for Doubtful Accounts
had a credit balance of $18,000. During 2021, $30,000 of uncollectible accounts receivable were written off. Past experience
indicates that 3% of net credit sales become uncollectible. What should be the adjusted balance of Allowance for Doubtful
Accounts at December 31, 2021?
(a) $10,050.
(b) $10,500.
(c) $22,500.
(d) $40,500

 Question 13
10 out of 10 points
Net sales for the month are $800,000, and bad debts are expected to be 1.5% of net sales. The company uses the percentage-
of-sales basis. If Allowance for Doubtful Accounts has a credit balance of $15,000 before adjustment, what is the balance
after adjustment?
(a) $15,000.
(b) $27,000.
(c) $23,000.
(d) $31,000.

 Question 14
10 out of 10 points
Which of the following approaches for bad debts is best described as a balance sheet method?
(a) Percentage-of-receivables basis.
(b) Direct write-off method.
(c) Percentage-of-sales basis.
(d) Both percentage-of-receivables basis and direct write-off method.

 Question 15
0 out of 10 points
As a result of a thorough physical inventory, Railway Company determined that it had inventory worth $180,000 at
December 31, 2017. This count did not take into consideration the following facts: Rogers Consignment store currently has
goods worth $35,000 on its sales floor that belong to Railway but are being sold on consignment by Rogers. The selling price
of these goods is $50,000. Railway purchased $13,000 of goods that were shipped on December 27, FOB destination, that
will be received by Railway on January 3.
Determine the correct amount of inventory that Railway should report.
(a) $230,000.
(b) $215,000.
(c) $228,000.
(d) $193,000.

 Question 16
0 out of 10 points
In horizontal analysis, each item is expressed as a percentage of the:
(a) net income amount.
(b) stockholders’ equity amount.
(c) total assets amount.
(d) base year amount.
 Question 17
10 out of 10 points
 Hansel Electronics has the following:  
Units Unit Cost
Inventory, Jan. 1    2 5,000 $8
Purchase, April       15,000 $10
Purchase, Aug. 28  20,000 $12

If Hansel has 7,000 units on hand at December 31, the

cost of ending inventory under the average-cost
 
method is:
(a) $84,000.  
(b) $70,000.
(c) $56,000.
(d) $75,250
 

 Question 18
10 out of 10 points
In vertical analysis, the base amount for depreciation expense is generally:
(a) net sales.
(b) depreciation expense in a previous year.
(c) gross profit.
(d) fixed assets

 Question 19
0 out of 10 points
Falk Company’s ending inventory is understated $4,000. The effects of this error on the current year’s cost of goods sold and
net income, respectively, are:
(a) understated, overstated.
(b) overstated, understated.
(c) overstated, overstated.
(d) understated, understated.

 Question 20
10 out of 10 points
Hughes Company has a credit balance of $5,000 in its Allowance for Doubtful Accounts before any adjustments are made at
the end of the year. Based on review and aging of its accounts receivable at the end of the year, Hughes estimates that
$60,000 of its receivables are uncollectible. The amount of bad debt expense which should be reported for the year is
(a) $5,000.
(b) $55,000.
(c) $60,000.
(d) $65,000.

 Question 21
10 out of 10 points
When there is a change in estimated depreciation:
(a) previous depreciation should be corrected.
 (b) current and future years’ depreciation should be revised.
(c) only future years’ depreciation should be revised.
(d) None of the above.

 Question 22
10 out of 10 points
Poppins Company has the following:
Units Unit Cost  
8,000 $11 Inventory, Jan. 1
13,000 12 Purchase, June 19
5,000 13 Purchase, Nov. 8
If Poppins has 9,000 units on hand at December 31,
the cost of the ending inventory under FIFO is:
   
(a) $99,000. (c) $113,000.
(b) $108,000. (d) $117,000.
 

 Question 23
0 out of 10 points
Which of the following measures is an evaluation of a firm’s ability to pay current liabilities?
(a) Acid-test ratio. (c) Both (a) and (b).
(b) Current ratio. (d) None of the above.

 Question 24
10 out of 10 points
A contingent liability should be recorded in the accounts when:
(a) it is probable the contingency will happen, but the amount cannot be reasonably estimated.
(b) it is reasonably possible the contingency will happen, and the amount can be reasonably estimated.
(c) it is probable the contingency will happen, and the amount can be reasonably estimated.
(d) it is reasonably possible the contingency will happen, but the amount cannot be reasonably estimated

 Question 25
0 out of 10 points
Maggie Sharrer Company expects to extract 20 million tons of coal from a mine that cost $12 million. If no salvage value is
expected and 2 million tons are mined in the first year, the entry to record depletion will include a:
(a) debit to Accumulated Depletion of $2,000,000.
(b) credit to Depletion Expense of $1,200,000.
(c) debit to Inventory of $1,200,000.
(d) credit to Accumulated Depletion of $2,000,000.

 Question 26
10 out of 10 points
Becky Sherrick Company has total proceeds from sales of $4,515. If the proceeds include sales taxes of 5%, the amount to be
credited to Sales Revenue is:
(a) $4,000. (c) $4,289.25.
(b) $4,300. (d) No correct answer given.

 Question 27
10 out of 10 points
Jefferson Company purchased a piece of equipment on January 1, 2017. The equipment cost $60,000 and has an estimated
life of 8 years and a salvage value of $8,000. What was the depreciation expense for the asset for 2018 under the double-
declining-balance method?
 (a) $6,500.
(b) $11,250.
(c) $15,000.
(d) $6,562.

 Question 28
10 out of 10 points
Martha Beyerlein Company incurred $150,000 of research and development costs in its laboratory to develop a patent granted
on January 2, 2017. On July 31, 2017, Beyerlein paid $35,000 for legal fees in a successful defense of the patent. The total
amount debited to Patents through July 31, 2017, should be:
(a) $150,000. (c) $185,000.
(b) $35,000. (d) $170,000

 Question 29
10 out of 10 points
Comparisons of data within a company are an example of the following comparative basis:
(a) Industry averages. (c) Intercompany.
(b) Intracompany. (d) Both (b) and (c).

 Question 30
10 out of 10 points
Norton Company purchased 1,000 widgets and has 200 widgets in its ending inventory at a cost of $91 each and a current
replacement cost of $80 each. The ending inventory under lower-of-cost-or-market is:
(a) $91,000. (c) $18,200.
(b) $80,000. (d) $16,000

 Question 31
10 out of 10 points
Which of the following statements is false?
(a) If an intangible asset has a finite life, it should be amortized
(b) The amortization period of an intangible asset can exceed 20 years.
(c) Goodwill is recorded only when a business is purchased.
(d) Research and development costs are expensed when incurred, except when the research and development expenditures
result in a successful patent.

 Question 32
10 out of 10 points
Which of the following measures is an evaluation of a fi rm’s ability to pay current liabilities?
(a) Acid-test ratio. (c) Both (a) and (b).
(b) Current ratio. (d) None of the above.

 Question 33
10 out of 10 points
Foti Co. accepts a $1,000, 3-month, 6% promissory note in settlement of an account with Bartelt Co. The entry to record this
transaction is as follows.

(a) Notes Receivable 1,015

                  Accounts Receivable 1,015
(b) Notes Receivable 1,000
                  Accounts Receivable 1,000
(c) Notes Receivable 1,000
                  Sales Revenue 1,000
(d) Notes Receivable 1,030
                   Accounts Receivable 1,030

 Question 34
10 out of 10 points
Andy Manion earns $14 per hour for a 40-hour week and $21 per hour for any overtime work. If Manion works 45 hours in a
week, gross earnings are:
(a) $560.
(b) $630.
(c) $650.
(d) $665.

 Question 35
0 out of 10 points
A measure useful in evaluating the efficiency in managing
inventories is
 

(c) Both (a) and (b).

(a) inventory turnover.
 
(b) days in inventory. (d) None of the above.