1. Assume that a machine with a cost of $2,000 has accumulated depreciation of $1,000. Assume it is sold for $1,500. Which of the following would be part of the journal entry to record this sale?

a. debit Accumulated Depreciation for $1,000

b. debit the Machine account for $2,000

c. debit Loss on Disposal for $500

d. debit Gain on Disposal for $500

2. Assume that a machine with a cost of $3,000 has accumulated depreciation of $1,500. It was sold for $1,800. Which of the following would be part of the journal entry to record this sale?

a. credit Accumulated Depreciation for $1,500

b. credit the Machine account for $1,500

c. credit Loss on Disposal for $300

d. credit Gain on Disposal for $300

3. Assume an older truck with a cost of $18,000 has accumulated depreciation of $10,000. The older truck and $21,000 cash are traded for new equipment valued at $30,000. Which of the following would be part of the journal entry to record this exchange?

a. debit Gain on Disposal for $1,000

b. credit Accumulated Depreciation, Truck for $10,000

c. credit Gain on Disposal for $2,000

d. debit Equipment for $30,000

4. Jill Hamlin borrowed $10,000 from the bank on August 31, issuing the bank a 12% note due on November 30. The entry to record accrued interest on the note on September 30 (the end of the first month after the note was made) would include:

a. debit Interest Expense for $295.89

b. debit Interest Payable for $295.89

c. debit Interest Expense for $98.63

d. debit Interest Payable for $98.63

5. During April, Koduck Cameras sold 150 instant cameras for $100 each. Each camera had cost Koduck $60 to manufacture, and carried a one-year warranty. Four percent of cameras sold typically need to be replaced over the warranty period, and two cameras are actually replaced during April. What amount should Koduck record in their Warranty Expense account in April?

a. $600 c. $240

b. $360 d. $120

6. Refer to number 5 above. The journal entry to be recorded when two of the units were actually replaced during the month would include:

a. a credit to Cash for $200

b. a debit to Estimated Warranty Liability for $120

c. a debit to Warranty Expense for $120

d. a credit to Inventory for $200

7. An amount is deposited into a bank account that pays 8%, compounded quarterly for 5 years. What number of periods and rate would be used to find the future value of this investment?

a. 20 periods at 2 percent c. 10 periods at 4 percent

b. 5 periods at 8 percent d. 20 periods at 4 percent

8. How much must be invested today, at 8%, compounded semi-annually, to be able to withdraw $1,000 each 6 months for 5 years?

a. $5,867 c. $12,006

b. $8,111 d. $3,993

9. What is the future value of $400 deposited today at 12% compounded monthly for 2 years.

a. $501.60 c. $504.80

b. $506.80 d. $508.00

10. If $1,000 is deposited each year for 5 years in an account that earns 8% compounded annually, how much will be in the account at the end of the five years?

a. $1,469 b. $5,867

c. $1,477 d. $9,549