Question

35) Following are transactions of the Twente 1. Issued 10.000 shares of co c k for $15.00 cm 2. Purchased and for $12.000, le foru 3. Purchased office equipment for $1.200 cash 4. Received cash or $14.000 FOR VIE W 5. Purchased $300 of office supplies on 6. Paid employees $10,000 for the mos t yung m A) $22,400. w balance of Gotebo's Cash C o llowing these B) 519,300. C) 529,800 30) At December 31, Gill Co, reported t a ble of $235.000 and allowance collectable accounts of $600 (credin h em datients. An analysis of MM T V suggests that the allowance for uncollectible s should be 3 of amount of the adjustment for uncollectible accounts would be A) 57,140. D) 57.740. S D ) $17800. accounts receivable. The B) 56,540. be 37) A company has the following three events in December 1. December 1 - Pay last month's rent (November), $500. 2. December 15- Pay rent for the current month (December), 5500 3. December 31 - Pay rent for the following year, 56,000. How much would be recorded as Rent Expense for the month of December using accrual accounting? A) $7,000. B) $500 C) $6, 500 D ) $1,000. 38) On January 1, Gucci Brothers Inc. started the year with a $492,000 balance in Retained Earnings and a 5605,000 balance in Common Stock. During the year, the company reported net income of $92,000, paid a dividend of $15,200, and issued more common stock for $27.500. What is total stockholders' equity at the end of the year? A) $1,097,000. B) $1,588,300 C) $1,201,300. D) 1.231,700. Allen Inc. took out a 1-year, 8%, $100,000 loan on March 31, 2018. Interest is due upon mature of the loan. The loan and interest must be paid back on March 31, 2019. As of December 31,29 what amount, if any, should Allen Inc. report for interest payable? A) $8,000. B) $0. C) $6,000. D) $2,000.

Answer 1

The answer has been presented in the supporting sheet. For detailed answer refer to the supporting sheet.

H А в DE Answer Part 35) The correct answer is D) $ 17800 Cash Balance after transactions = Cash received from issue of common stock-cash paid for office equipment +receivedd cash from customers - cash paid for salaries = 15000-1200+14000-10000 =$ 17800 Part 36) The correct answer is B) $6540 Adjustment for allowance for uncollectible accounts = desired balance - existing credit baalnce = (238000*3%) - 600 = $ 6540 Part 37) The correct answer is B) $ 500 Explanation as per accrual basis of accounting expense is booked for the period whether cash has been paid for it in the same period or in the next period. In our case december rent expense will be booked as per accrual basis of accounting of $ 500

Part 38) The correct answer is C) $ 1201300 ending stock holders equity = ending balance of common stock + ending balance of retained earnings = (605000+27500) + (492000+92000-15200) = 632500+568800 = 1201300 The correct answer is C) $6000 Balance of interest payable = balance of loan * interest rate *period till december 31,2018/12 = 100000*8%* 9/12 = $ 6000