20. Racer Corporation's December 31,2014 balance sheet showed the 8% preferred stock, S20 par value, curmulative, 40,000 shares authorized: 20,000 shares issued Common stock, $10 par value, 4,000,000 shares authorized. S 400,000 26.000,000 2,600,000 shares issued, 2,560,000 shares outstanding Paid-in capital in excess of par value- preferred stock Paid-in capital Retained earnings Treasury stock (30,000 shares) Racer's total stockholders' equity was A) $72,680,000. B) $71,840,000. C) $62,480,000. D) $73,520,000. 80,000 36,000,000 10,200,000 840,000 in excess of par value-common stock 21. A company shows the following balances: Sales Revenue Sales Returns and Allowances Sales Discounts Cost of Goods Sold What is the gross profit rate? A)60% ?) 40% C) 47% D) 53% $ 800,000 75,000 25,000 420,000 Nacron Company borrowed S10.000 from the banksigning a 6%,3 math note on September 1. Principal and interest are payable to the bank on December 1. If the company prepares monthly financial statements, the adjusting entry t should make for interest on September 30, would be: A) debit Interest Expense, $600; credit Interest Payable, S600 B) debit Cash, $50, credit Interest Payable, $50. 22. that the company debit Interest Expense, $50; credit Interest Payable, $50. debit Note Payable, $600; credit Cash, $600. Two methods of accounting for uncollectible accounts are the A) direct write-off method and the accrual method. B) allowance method and the accrual method. C) direct write-off method and the allowance method. D) allowance method and the net realizable method. Page 6 Version