1 of35

Which of the following would NOT be considered part of the cost of a constructed building?

Contractor charges

Architectural fees

Building permit fees

Realtor commissions

Question

2 of35

Under the direct write-off method, to record the receipt of cash after an account has previously being written off, you would first

debit Bad Debt Expense.

debit Allowance for Doubtful Accounts.

reinstate the customer's account.

debit Cash and credit the customer's account.

Question

3 of35

Which of the following would be considered a natural resource?

Wheat

Corn

Livestock

Timber

Question

4 of35

An asset has a cost of $50,000 with a residual value of $10,000. It has a life of 5 years and was purchased on January 1. Its fourth full year of depreciation expense under double-declining-balance will be

$7,200.

$800.

$4,320.

$0.

Question

5 of35

Which would be considered part of land improvements?

Signs

Removing unwanted buildings from the land

Fencing

In-ground sprinkler systems

Question

6 of35

Cesario Corporation purchases a machine for $125,000. It has an estimated salvage value of $10,000 and is expected to produce 50,000 units in its lifetime. During the first year of operation, it produced 14,500 units. To the nearest dollar, the depreciation for the first year under the units of production method will be

$35,500.

$33,350.

$36,250.

$31,250.

Question

7 of35

When using the allowance method for uncollectible accounts, the aging method is called the

Allowance approach.

Income Statement approach.

Direct write-off approach.

Balance Sheet approach.

Question

8 of35

Which of the following would be considered a cash equivalent?

Time deposits

Checks

Currency

Money orders

Question

9 of35

Leo Company has a petty cash fund of $300. At the end of the month, $42.38 remains in the fund along with $260.75 in various receipts for purchases. The journal entry to replenish the fund would be

debit various expenses, $260.75, and credit Cash for $260.75.

debit Petty Cash for $257.62, and credit Cash for $257.62.

debit various expenses, $260.75; credit Cash Over for $3.13, and credit Cash for $257.62.

debit various expenses, $254.49; debit Cash Short for $3.13, and credit Cash for $257.62.

Question

10 of35

Gallego & Co. reported sales of $515,000; beginning net Accounts Receivable of $212,000; and ending net Accounts Receivable of $224,000. Gallego & Co.'s receivable collection period (rounded to the nearest day) is

159.

150.

106.

155.

Question

11 of35

When companies extend credit to customers

the likelihood of not collecting money from customers increases.

sales generally decrease.

the likelihood of not collecting money from customers decreases.

the amount of business stays the same.

Question

12 of35

Lionworks Company has cash of $143,000; net Accounts Receivable of $89,000; short-term investments of $35,000; and prepaid expenses of $40,000. It also has $50,000 in current liabilities and $80,000 in long-term liabilities. The quick ratio for Lionworks Company is

6.14.

5.34.

3.34.

4.64.

Question

13 of35

Which of the following is NOT true concerning NSF checks?

NSF checks represent customer checks that the business previously deposited but have turned out to be worthless.

The amount of the NSF check will need to be added to the book balance.

NSF stands for nonsufficient funds.

The amount of the NSF check will need to be subtracted from the book balance.

Question

14 of35

Leo's Lawn Care purchased equipment on January 1. The cost was $15,000, and the equipment had a residual value of $4,000. The equipment was given a useful life of 7 years. After the end of two years, it was determined that the equipment would be obsolete in 3 more years, and the residual value would still be $4,000. What will be the depreciation under the straight-line method to the nearest dollar for the third year?

$2,619

$7,857

$3,142

$1,571