I'm not looking for just answers (ie. A,B,C, etc). I want to understand the material, so please provide as much explanation as you can. Thank you and a big thumbs up!

(1). Which of the following is an example of a closing entry?

	A.	Debit to Retained Earnings; Credit to Prepaid Insurance
	B.	Debit to Service Expense; Credit to Retained Earnings
	C.	Debit Supplies; Credit Accounts Payable
	D.	Debit to Service Revenue; Credit to Retained Earnings
	E.	Debit Dividends; Credit Cash

(2). Detmer & Co. has the following inventory remaining at the end of the year: The year-end adjustment to Cost of Goods Sold would be:

	Quantity	Cost	Market
Item A	100	5	8
Item B	200	6	4

	A.	$200
	B.	$100
	C.	$300
	D.	$400
	E.	$0

(3). Ward Inc. reports a gain on the sale of an asset. Which of the following is always true?

	A.	The company sold the asset for more than it was worth.
	B.	The company sold the asset for more than fair value.
	C.	The company sold the asset for more than book value.
	D.	The company sold the asset before the useful life was over.
	E.	None of the above are true.

(4). Which depreciation method will result in the greatest amount of depreciation expense in the last year of the asset"s life?

	A.	Straight-line
	B.	LIFO
	C.	Lower-of-cost-or-market
	D.	Double-declining balance
	E.	FIFO

(5). The bank shows a cash balance of $17,300 while the company has a cash balance of $9,000. Using the following information, calculate the reconciled balance of cash: Bank service fees = $2,400 Deposits outstanding = $11,000 Note receivable collected by the bank = $8,000 Checks outstanding = $15,000 Non-sufficient funds (NSF) checks = $1,300

	A.	$28,600
	B.	$9,300
	C.	$34,600
	D.	$13,300
	E.	$28,300

(6). White Inc. decided to purchase a new sign to attract more customers to its location. The following costs were incurred in relation to the purchase of the sign: At what amount should the sign be recorded?

Cost of the sign	$9,000
Cost of installation	$5,000
Cost of transportation	$2,000
Office party to celebrate new sign	$500
Utilities in first month to operate the sign	$100

	A.	$16,500
	B.	$16,000
	C.	$14,000
	D.	$16,100
	E.	$16,600

(7). Leinart Co. had the following inventory transactions for the period. Calculate gross profit using the FIFO cost flow assumptions.

Date		Quantity	Purchase Cost	Selling Price
July 1	Beginning Inventory	350	$1
July 10	Sale	150		$5
July 14	Purchase	400	2
July 17	Sale	300		6
July 28	Purchase	200	4

	A.	$1,400
	B.	$550
	C.	$1,250
	D.	$2,000
	E.	$2,550

(8). Which of the following accounts is considered to have a permanent balance?

	A.	Sales Revenue
	B.	Cost of Goods Sold
	C.	Retained Earnings
	D.	Prepaid Rent
	E.	Two of the above have permanent balances

(9). Which of the following is true concerning inventory?

	A.	LIFO produces lower net income than FIFO in a period of rising prices
	B.	FIFO is a balance sheet focus, while LIFO is an income statement focus
	C.	If LIFO is used for tax reporting, it must also be used for financial reporting.
	D.	All of the above are true
	E.	None of the above are true

(10). The current year"s beginning and ending balances for Allowance for Uncollectible Accounts is $23,000 and $27,000, respectively. If the amount of Bad Debt Expense for the year is $18,000, what is the amount of actual bad debts for the year?

	A.	$20,000
	B.	$18,000
	C.	$10,000
	D.	$22,000
	E.	$14,000

(11). While providing services to Palmer Co., Raider Group caused damages of $125,000. As of the end of the year, both parties agree that it is probable that Raider will pay Palmer the full amount of the damages within the next two months. How would Raider and Palmer record the lawsuit at the end of the year?

	A.	Raider records nothing; Palmer records nothing
	B.	Raider records contingent gain; Palmer records contingent gain
	C.	Raider records nothing; Palmer records contingent gain
	D.	Raider records contingent loss; Palmer records nothing
	E.	Raider records contingent loss; Palmer records contingent gain

(12). What journal entry is necessary to record the return of inventory previously purchased on account?

	A.	Debit Accounts Payable; Credit Inventory
	B.	Debit Accounts Payable; Credit Sales Revenue
	C.	Debit Cash; Credit Inventory
	D.	Debit Inventory; Credit Accounts Payable
	E.	Debit Sales Revenue; Credit Accounts Payable

(13). On January 1, 2012, Woodson Inc. purchased a machine that cost $500,000 and had a residual value of $50,000. The machine is expected to produce 360,000 units of cheese and is estimated to last 10 years. If 25,000 units were produced in 2012 and 35,000 were produced in 2013, what amount of Accumulated Depreciation is reported at the end of 2013 using the activity-based method (rounded to the nearest whole dollar if necessary)?

	A.	$90,000
	B.	$75,000
	C.	$43,750
	D.	$83,333
	E.	$31,250

(14). How many of the following transactions increase a company"s liquidity?

a.	Provide services on account
b.	Pay workers salaries in the current period
c.	Purchase office supplies with cash
d.	Pay dividends to stockholders

	A.	1
	B.	3
	C.	2
	D.	4
	E.	0

(15). Current liabilities are best described as:

	A.	A small amount of debt
	B.	Debt likely to be repaid
	C.	Debt due within one year
	D.	A large amount of debt
	E.	Debt due in more than one year

(16). Panthers Inc. receives services on account from Newton Inc. on September 29. Panthers Inc. pays for the services on October 5. How would Panthers Inc. record the payment on October 5?

	A.	Credit to Service Revenue
	B.	Debit to Cash
	C.	Debit to Accounts Payable
	D.	Credit to Service Expense
	E.	Credit to Accounts Receivable