1. Based on the following account balances, what is the total shareholders equity?

Common Shares................................................................... $700,000

Stock Dividends Distributable............................................. 40,000

Retained Earnings................................................................ 190,000

Preferred Shares................................................................... 20,000

Cash Dividends Payable...................................................... 50,000

options:

	$950,000
	$800,000
	$820,000
	$850,000
	None of the above

2. At the beginning of the current period, Newman Corporation had balances in Accounts Receivable of $201,100 and in Allowance for Doubtful Accounts of $9,900 (credit). During the period, Newman had credit sales of $805,800 and collections on account of $769,300.

Newman uses a perpetual inventory system and determined that the cost of goods sold during the period was $669,500. Newman wrote off as uncollectible accounts receivable of $7,500. However, a $2,800 account previously written off as uncollectible was recovered before the end of the current period. Uncollectible accounts are estimated to total $25,400 at the end of the period.

The adjusting entry to record bad debts expense for the period is:

Question 2 options:

Bad Debt Expense			25,400
	Allowance for Doubtful Accounts			25,400

Bad Debt Expense			8,000
	Accounts Receivable			8,000

Bad Debt Expense			20,200
	Allowance for Doubtful Accounts			20,200

Bad Debt Expense			15,500
	Accounts Receivable			15,500

None of the above

3. The shareholders' equity section of Starr Corporation at December 31, 2015 included the following:

$3 preferred shares, cumulative, 10,000 shares authorized, 9,000 shares issued	$900,000
Common shares, 500,000 shares authorized, 400,000 shares issued	$2,000,000

Dividends were not declared on the preferred shares in 2015 and are in arrears.

On September 15, 2016, the board of directors declared dividends on the preferred shares for 2015 and 2016 to shareholders of record on October 1, 2016, payable on October 15, 2016.

On November 1, 2016, the board of directors declared a $0.50 per share dividend on the common shares, payable November 30, 2016, to shareholders of record on November 15, 2016.

Using the above information, the correct entry on October 15, 2016 would be:

Question 3 options:

	Debit dividend payable $27,000; credit cash $27,000
	Debit cash dividend $27,000; credit dividend payable $27,000
	Debit cash dividend $54,000; credit dividend payable $54,000
	Debit dividend payable $54,000; credit cash $54,000
	None of the above

4. As of December 31, 2015, Donnelly Corporation had 350,000 common shares authorized, 250,000 of which had been issued for proceeds of $2.5 million. The Retained Earnings balance was $1,200,000.

On January 18, 2016, 40,000 common shares were issued at $20 per share. Profit for 2016 was $180,000. No dividends were declared in 2016.

The balances in the shareholders' equity section of the statement of financial position at December 31, 2016 will be:

Question 4 options:

	Retained earnings $1,020,000; Common shares issued $3,300,000
	Retained earnings $1,380,000; Common shares issued $3,300,000
	Retained earnings $1,380,000; Common shares issued $290,000
	Retained earnings $1,380,000; Common shares issued $2,580,000
	None of the above