1.Under GAAP Company's accounting system, all insurance premiums paid are debited to Prepaid Insurance. For interim financial reports, GAAP makes monthly estimated charges to insurance expense with credits to Prepaid Insurance. Additional information for the year ended December 31, 2020, is as follows:

Prepaid Insurance at December 31, 2019 105,000

Charges to insurance expense during 2020

(including a year-end adjustment of 27,500)437,500

Prepaid Insurance at December 31, 2020122,500

What was the total amount of insurance premiums paid by GAAP during 2020?

2.At December 31, 2020, the Mars Company had a 990,000 balance in its advertising Expense account before any year-end adjustments relating to the following:

Radio Advertising spots broadcast during December 2020 were billed to Mars on January 4, 2021. The invoice cost of 50,000 was paid on January 15, 2021.

Included in the 990,000 is 60,000 for newspaper advertising for a January 2021 sales promotional campaign.

Mars advertising expense for year ended December 31, 2020 should be what amount?

3.At December 31, 2020, the unadjusted trial balance shows Office Supplies of 60,000 and Office Supplies Expense of 101,000. The December 31, adjusting entry debited Office Supplies Expense of 17,000. After the December adjusting entries have been posted, what is the correct balance in the Office Supplies account on December 31, 2020?

4.The following data relate to store equipment of Progress Company for 2020:

20192010

Store Equipment - cost 145,000 175,000

Accumulated Depreciation58,00060,000

Store equipment costing 30,000 was sold for 21,000 resulting in a gain of 3,000.

How much is the Depreciation expense on store equipment for 2020?

5.On November 1, 2020, Pluto Company paid 36,000 to renew its insurance policy for three years. At December 31, 2020. Pluto's unadjusted trial balance showed a balance of 900 for Prepaid Insurance and 44,100 for Insurance Expense. What amount should be reported for Insurance Expense in Pluto's December 31, 2020 financial statements?

6.The accrual income statement of Carnation, Inc. included the following expenses for 2020: Depreciation Expense - 65,000; Salaries and wages - 189,000; Interest Expense - 36,000.

The comparative balance sheet reported the following related accounts:

12/31/202012/31/2019

Accumulated Depreciation 96,000 154,000

Accrued Salaries and Wages8,00012,000

Accrued Interest Payable10,5007,000

Considering only the data above, what amount would be a pure cash basis expense for 2020?

7.On January 1, 2019 Jupiter Company acquired the copyright to a book owned by Garner for royalties of 15% of future books sales. Royalties are payable on September 30, for sales in January through June of the same year, and on March 31 for sales in July through December of the preceding year. During 2019 and 2020, Jupiter remitted royalty checks to Garner as follows:

March 31September 30

2019- 250,000

2020220,000400,000

Jules sales of the Garner book totaled 3,000,000 for the last half of 2020.

How much Royalty Expense should Jupiter report in its 2020 income statement?

8.Milkmaid, Inc. maintain its accounting records on the cash basis but restates its financial statements to the accrual method of accounting. Milkmaid had 600,000 cash basis pretax income for 2020.

The following information pertains to Milkmaid for the years ended December 31, 2020 and 2019:

20202019

Account Receivable 400,000 200,000

Accounts Payable150,000300,000

Under the accrual method, What amount would Milkmaid report in its December 31, 2020 income statements as pretax income?

9.Sky Company collected 12,350 in interest during 2020. Sky showed 1,850 in interest receivable on its December 31, 2020 balance sheet and 5,300 on December 31, 2019.

How much is the Interest Revenue reported on Sky's income statement for 2020?