1.

The following information is from the Income Statement of the Dirt Poor Laundry Service:

Revenues
Service Revenues	$5,500
Expenses
Salaries and wages expense	$1,950
Advertising expense	500
Rent expense	300
Supplies expense	200
Insurance expense	100
Total expenses	3,050
Net income	$2,450

The entry to close the Laundry Service Revenue account includes a:

debit to Service Revenue for $5,500.

debit to Retained Earnings for $5,500.

credit to Service Revenue for $5,500.

debit to Income Summary for $5,500.

2.

When a company has performed a service but has not yet received payment, it

debits accounts receivable and credits service revenue.

makes no entry until the cash is received.

debits revenue from services and credits accounts receivable.

debits revenue from services and credits accounts payable

3.

Which of the following would not be subtracted from the balance per books on a bank reconciliation?

NSF checks.

Check printing charge.

Service charges.

Outstanding checks.

4.

Pearson Company bought a machine on January 1, 2014. The machine cost $144,000 and had an expected salvage value of $24,000. The life of the machine was estimated to be 5 years. The depreciable cost of the machine is

$24,000.

$144,000.

$120,000.

$40,000.

5.

A machine that was purchased on January 1 for $45,000 has an estimated salvage value of $9,000. If the machine's depreciation rate is 20%, its annual depreciation is

$36,000.

$10,800.

$7,200.

$9,000.

6.

Machinery was purchased for $170,000. Freight charges amounted to $7,000 and there was a cost of $20,000 for building a foundation and installing the machinery. It is estimated that the machinery will have a $30,000 salvage value at the end of its 5-year useful life. Depreciation expense each year using the straight-line method will be

$28,000.

$39,400.

$28,600.

$33,400.

7.The interest on a $10,000, 6%, 60-day note receivable is

$100.

$200.

$680.

$300.

8.

Which one of the following events would not require a journal entry on a corporation's books?

2-for-1 stock split.

100% stock dividend.

2% stock dividend.

$1 per share cash dividend

9.

Dividends in arrears are dividends on

cumulative preferred stock that have been declared but have not been paid.

non-cumulative preferred stock that have not been declared for a given period of time.

cumulative preferred stock that have not been declared for a given period of time.

common dividends that have been declared but have not yet been paid.

10.

Which of the following statements is not true about a 2-for-1 split?

Par value per share is reduced to half of what it was before the split.

Total contributed capital increases.

The market price probably will decrease.

A stockholder with ten shares before the split owns twenty shares after the split

11.

The per share amount normally assigned by the board of directors to a small stock dividend is

the market value of the stock on the date of declaration.

zero.

the par or stated value of the stock.

the average price paid by stockholders on outstanding shares

12

On the dividend record date

a dividend becomes a current obligation.

an entry may be required if it is a stock dividend.

Dividends Payable is debited.

no entry is required.