Multiple choice questions If answer is not there NONE OF THE ABOVE

1)If an asset costs $91,000, has a residual value of $8,000, and has a useful life of five years, the entry to record depreciation in the second year, using the double-declining-balance method, is

A) Depreciation Expense 36,400 $ Cash 36,400 $

B) Depreciation Expense 21,840 $ Accumulated Depreciation - Asset 21,840 $

C) Depreciation Expense 34,600 $ Accumulated Depreciation - Asset 34,600 $

D) Accumulated Depreciation - Asset 13,104 $ Depreciation Expense 13,104

2) Equipment is purchased for $100,000. It has a five-year useful life and a $12,000 residual value. Under the double declining balance method, what is the depreciation expense for year 3?

A) 17,280 $

B) 15,360 $

C) 14,400 $

D) 12,800 $

E) None of the above

3)A truck that cost $15,000 and on which $7,000 of accumulated depreciation has been recorded was sold on January 1. Assume that the truck was sold for $12,000 cash. The entry to record this event is

A) Accumulated Depreciation - Truck 8,000 $ Truck 8,000 $

B) Cash 3,000 $ Accumulated Depreciation - Truck 7,000 $ Loss on Sale of Truck 5,000 $ Truck 15,000 $

C) Cash 12,000 $ Accumulated Depreciation - Truck 7,000 $ Truck 15,000 $ Gain on Sale of Truck 4,000 $

D) Truck 15,000 $ Accumulated Depreciation - Truck 15,000

4) BAMA Corporation sold for $5,000 plant assets that cost $20,000 and that had an accumulated depreciation of $12,000. The journal entry to record the transaction is:

A) Cash 5,000 $ Plant Assets 5,000 $

B) Plant Assets 8,000 $ Cash 8,000 $

C) Cash 5,000 $ Accumulated Depreciation - Plant Assets 12,000 $ Loss on Sale of Plant Assets 3,000 $ Plant Assets 20,000 $

D) Cash 5,000 $ Loss on Sale of Plant Assets 3,000 $ Plant Assets 8,000

5)Rand Corporation issues 500, 5-year, 6%, $1,000 bonds dated January 1, 2019, at 105. The journal entry to record the issuance will show a

A) debit to Cash of $500,000. B) credit to Premium on Bonds Payable for $25,000. C) credit to Bonds Payable for $525,000. D) credit to Cash for $525,000. E) None of the above.

6) Discount on Bonds Payable

A) has a credit balance. B) is a contra account. C) is considered to be an addition in the cost of borrowing. D) is added to bonds payable on the balance sheet. E) None of the above.

7) If bonds payable were issued initially at a premium, the carrying value of the bonds at balance sheet date will be calculated by

A) adding the amount of premium amortized between the issuance date and the balance sheet date to the face value.

B) adding the balance of unamortized bond premium to the face value.

C) deducting the balance of unamortized bond premium to the face value.

D) deducting the amount of premium amortized between the issuance date and the balance sheet date to the face value.

E) None of the above.

8) When bonds have been issued at a discount, the periodic amortization of the discount will

A) increase the carrying value of the bonds.

B) decrease the carrying value of the bonds.

C) have no effect on the carrying value of the bonds.

D) cause the carrying value always to equal the face value of the bonds.

E) None of the above.

9) Warren invests personally owned equipment, which originally cost $300,000 and has accumulated depreciation of $70,000 in the Warren and Rogers partnership. Both partners agree that the fair value of the equipment was $250,000. The entry made by the partnership to record Bagley's investment should be

A) Equipment 300,000 $ Accumulated DepreciationEquipment 70,000 $ Warren, Capital 230,000 $

B) Equipment 250,000 $ Warren, Capital 250,000 $

C) Equipment 250,000 $ Accumulated DepreciationEquipment 70,000 $ Gain on Purchase of Equipment 20,000 $ Warren, Capital 300,000 $

D) Equipment 230,000 $ Warren, Capital 230,000

10) Partners Mary and Blaine have agreed to share profits and losses in an 70:30 ratio respectively, after Mary is allowed a salary allowance of $40,000 and Blaine is allowed a salary allowance of $25,000. If the partnership had net income of $100,000 for 2019, Blaine's share of the income would be

A) 32,500 $ B) 40,500 $ C) 35,500 $ D) 40,000 $ E) None of the above

11) A partner invests into a partnership a building with a $75,000 carrying value and $50,000 fair market value. The related mortgage payable of $15,000 is assumed by the partnership. The entry to record the investment in partnership is:

A) Building 50,000 $ Mortgage Payable 15,000 $ Capital 35,000 $

B) Building 75,000 $ Mortgage Payable 15,000 $ Capital 60,000 $

C) Capital 75,000 $ Mortgage Payable 15,000 $ Building 60,000 $

D) Capital 50,000 $ Mortgage Payable 15,000 $ Building 35,000 $

12) Partners R and S receive a salary allowance of $13,000 and $27,000, respectively, and share the remainder equally. If the company earned $54,000 during the period, the entry to close the income or loss into their capital accounts is:

A) Income Summary 54,000 $ R, Capital 27,000 $ S, Capital 27,000 $

B) Income Summary 40,000 $ R, Capital 13,000 $ S, Capital 27,000 $

C) Income Summary 54,000 $ R, Capital 20,000 $ S, Capital 34,000 $

D) Income Summary 50,000 $ R, Capital 18,000 $ S, Capital 32,000 $