Opal, Inc purchased Ruby Company for $600,000 cash. The fair market value of Ruby's assets was $340.000 and the company had liabilities of 20,000.What amount of goodwill should Opal record related to the puchase of Ruby Company?

a. 280,000

b. 600,000

c. 340,000

d. 320,000

2. Baxter, Co borrowed $100,000 from the bank on September 1, 2018. The note had a 6% annual rate of interest and matured on August 31, 2019. Interest and principal were paid in cash on the maturity date. What was the amount of interest expense reported on the 2018 Income statement?

a. 6,000

b. 1,500

c. 2,000

d. 0

3. Independent auditors are:

a. responsible for discovering fraud

b. responsible for providing reasonable assurance that financial statements are free of misstatements

c. responsible for providing absolute assurance that financial statements are free of errors.

d. none of these

4. In a bank reconciliation, a customer's NSF check included with the bank statement is:

a. deducted from the bank's cash balance to get the true cash balance.

b. added to the bank's cash balance to get the true cash balance.

c. deducted from the company's cash balance to get the true cash balance.

d. added to the company's cash balance to get the true cash balance