IA

The cash account shows a balance of 45,000 before reconciliation. The bank statement does not include a deposit of 2,300 made on the last day of the month. The bank statement shows a collection by the bank of 940 and a customer's check for 320 was returned because it was NSF. A customer's check for 450 was recorded on the books as 540, and a check written for 79 was recorded as 97. The correct balance in the cash account was a. 45, 512. b. 45, 548. O c. 45, 728. O d. 47,848.Everwood Co. issues 10,000 shares of 10 par value convertible preference shares for 12 cash per share. Each share is convertible into 4 ordinary shares. On this date the 1 par value ordinary shares are selling for 3 per share. Approximately 2 years later, Everwood's shareholders convert their preference shares into ordinary shares. On the date of conversion the preference shares are selling for 16 and the ordinary shares are selling for 5 per share. The journal entry on the date of conversion will include which of the following? a. Credit Share Capital-Preference 20,000. b. Credit Share Premium-Ordinary 80,000 O c. Credit Share Capital-Ordinary 100,000 O d. Credit Share Premium-Ordinary 160,000.Torrey Co. manufactures equipment that is sold or leased. On December 31, 2016, Torrey leased equipment to Dalton for a five-year period ending December 31, 2021, at which date ownership of the leased asset will be transferred to Dalton. Equal payments under the lease are 220,000 (including 20,000 executory costs, and are due on December 31 of each year. The first payment was made on December 31, 2016. The normal sales price of the equipment is 770,000, and cost is 600,000. For the year ended December 31, 2016, what amount of income should Torrey realize from the lease transaction? a. 170,000 b. 220,000 O c. 230,000 O d . 330,000On January 1 2016, Cypress Industries purchased 25% of the ordinary shares of Shane, Inc. The investment enables Cypress to exert significant influence over Shane, Inc. During the year, Shane earned net income of 160,000 and paid dividends of 40,000 and Cypress Industries earned net income of 280,000. At December 31, 2016, shares of Shane, Inc. were trading for 40 per share, and the value in the investment account on the books of Cypress was 395,000. What amount did Cypress Industries pay for its investment in Shane on January 1, 2016? a. 365,000 b. 425,000 c. 325,000 d. 335,000When preparing a draft of its year 1 balance sheet, Mont, Inc. reported net assets totaling 875,000. Included in the asset section of the balance sheet were the following: Treasury stock of Mont, Inc. at cost, which approximates market value on December 31 24,000; Idle machinery 11,200; Cash surrender value of life insurance on corporate executives 13,700; Allowance for decline in market value of noncurrent equity investments 8,400. At what amount should Mont's net assets be reported in the December 31, year 1 balance sheet? a. 851,000 O b. 850, 100 C. 842,600 O d. 834,500Harrel Company acquired a patent on an oil extraction technique on January 1, 2015 for 5,000,000. It was expected to have a 10 year life and no residual value. Harrel uses straight-line amortization for patents. On December 31, 2016, the recoverable amount of the patent was estimated to be 4,500,000. At what amount should the patent be carried on the December 31, 2016 balance sheet? a. 5,000,000 O b. 4,500,000 O c. 4,000,000 d. 2,800,000Mays Company has a machine with a cost of 400,000 which also is its fair value on the date the machine is leased to Park Company. The lease is for 6 years and the machine is estimated to have an unguaranteed residual value of 40,000. If the lessor's interest rate implicit in the lease is 12%, the six beginning-of- the-year lease payments would be a. 92,361. b. 82, 465. O C. 78,180. O d. 66,667