High Sierra Tacos acquired a taco truck from Taco Wholesalers on 6/30/15 and gave

a noninterest-bearing note in exchange. High Sierra Tacos is obligated to pay $650,000

on 6/30/17 to satisfy the obligation in full. If High Sierra Tacos accrued interest of

$50,000 on the note in its 2015 year-end financial statements, at what amount would it

record the equipment on its 6/30/15 balance sheet?

A. $450,000

B. $700,000

C. $600,000

D. $650,000

E. $850,000

Tragic Taco lost its taco truck to bandits who took it south of the border. They are

trying to collect insurance on the lost inventory and have the following data: Inventory

January 1, 2015, $80,000; sales up to the theft: 300,000; purchases up to the theft:

$200,000. Tragic consistently reports a 25% gross profit. The estimated lost inventory

is:

A. $205,000.

B. $280,000.

C. $200,000

D. None of these.

E. $55,000.

At January 1, 2015, French Taco had a credit balance of $500,000 in its allowance

for uncollectible accounts. Based on past experience, 1 percent of French's credit sales

have been uncollectible. During 2015, French wrote off $600,000 of accounts

receivable. Credit sales for 2015 were $20,000,000. In its December 31, 2015 balance

sheet, what amount should French report as allowance for uncollectible accounts?

A. None of these.

B. $500,000.

C. $200,000.

D. $100,000.

E. $300,000.

On July 1 of the current year, Online Tacos factored receivables with a carrying

value of $560,000 to a local bank. The transfer was made without recourse. The bank

remits 85% of the factored amount to Online Tacos and retains the remaining 15%.

When collections are over, the bank will remit to Online Tacos what it collects of the

retained amount (expected to be $70,000) less a fee equal to 8% of the total amount

factored. On July 1, Online Taco would

A. Debit loss on sale of receivables for $58,800

B. None of these.

C. Debit accounts receivable for $560,000.

D. Debit receivable from factor for $70,000.

E. Credit cash for $476,000.