1. Gains differ from revenues because gains:

	A.	are recorded directly to retained earnings.
	B.	are not from transactions involving the entity's primary, recurring business operations.
	C.	are initially deferred by being capitalized to a balance sheet account.
	D.	increase income from operations on the multi-step income statement.
	E.	are the result of sales to customers in the ordinary course of business.

1. On September 1, 2011, a company purchased a weaving machine for $239,800. The machine has an estimated useful life of 8 years and an estimated residual value of $17,800. Additionally, it is estimated that the machine would produce 740,000 bolts of woven fabric over its useful life. The company ended up selling the machine in 2018 after 1 month of use.

The following budgeted and actual activity levels were provided to support your work:

Assuming the company uses the straight line depreciation method, select the answer below that shows the machine's net book value at 12/31/2013. If applicable, round your intermediate calculations to 3 decimals and your final answer to the nearest $1.

	A.	$160,000
	B.	$138,750
	C.	$175,050
	D.	$157,250
	E.	$156,550

1. Information on a depreciable asset owned by Li Engineering is as follows:

If the asset is sold on July 1, 2011 for $10,000, the journal entry to record the sale will include:

	A.	A debit to loss on sale for $12,500
	B.	A credit to gain for $10,000
	C.	A credit to cash for $10,000
	D.	A debit to loss on sale for $15,000
	E.	A debit to accumulated depreciation for $25,000

1. Radar Repair Company opened on March 1 of the current year. During March, the following transactions occurred and were recorded in the company's books:

1. Rick Radar, the sole stockholder, invested $20,000 cash in the business in exchange for common stock.

2. Rick contributed $2,000 of equipment to the business in exchange for common stock.

3. The company provided $8,000 of services to customers on account.

4. The company paid $2,000 cash to rent office space for the month of March and April ($1,000 per month).

5. The company collected $11,000 cash for repair services, $5,000 representing payment for services provided during March* and $6,000 representing payment for services to be provided in April.

*these are additionalMarch services & are unrelated to transaction #3.

6. The company paid $4,000 for salaries for the month of March.

7. The company purchased $2,000 of supplies. Radar paid $1,000 of cash at the time the supplies were delivered and purchased the remaining supplies on account.

8. The company collected $5,000 from customers as payment on account for services rendered on account in March (transaction #3).

Based on this information, total stockholder's equity reported on the balance sheet at the end of March would be:

	A.	$22,000
	B.	$25,000
	C.	$30,000
	D.	$31,000
	E.	none of the answer choices provided are correct.

1. On December 31, 2015, Dab Industries reported an unearned service revenue account balance of $2,500 and during 2016 the overall account balance (i.e. reported by the company on its financial statements) decreased by $1,300. During 2016, cash payments collected from customers for future services totaled $5,000. Select the answer below that correctly presents the December 31, 2016 adjusting entry.

	A.	Cash (dr) $5,000 Unearned Service Revenue (cr) $5,000
	B.	Unearned Service Revenue (dr) $1,300 Service Revenue (cr) $1,300
	C.	Service Revenue (dr) $3,800 Unearned Service Revenue (cr) $3,800
	D.	none of the answer choices provided are correct.
	E.	Unearned Service Revenue (dr) $6,200 Service Revenue (cr) $6,200