-Palmer Products purchased a new delivery truck. The truck had a manufacturer's listed retail price of $14,000 and a negotiated purchase price of $13,200. The purchase was subject to terms of 2/10, n/30, but Palmer did not remit payment until 22 days after the purchase. At what amount should Palmer record the truck on its books?

a. $12,936.

b. $13,200.

c. $13,720.

d. $14,000.

-Hanley Manufacturing purchased a new machine on January 1, 19X4, for $47,000 plus $8,000 of freight and installation costs. Hanley uses the double declining method of recording depreciation, and estimates the machine will last 10 years and have a residual value of $5,000. What amount of depreciation will Hanley record in 19X5?

a. $6,720.

b. $8,800.

c. $7,520.

d. $8,000.

-Glouchester Associates sold office equipment for cash of $142,000. The accumulated depreciation at date of sale amounted to $138,000, and a gain of $18,000 was recognized on the sale. The original cost of the asset must have been:

a. $262,000

b. $260,000

c. $280,000

d. $156,000

-For the month ended January 31, Ponzi Plastic Co. had net sales of $100,000, total goods available for sale of $70,000, and an estimated gross profit percentage of 40%. Ponzi's estimated inventory at the end of January is:

a. $10,000

b. $30,000

c. $40,000

d. $60,000

- The fair market value of Lewis Company's net identifiable assets is $5,000,000. Martin Corporation purchases Lewis' entire business for $5,800,000. Which of the following statements is not correct?

1. Martin Corporation paid $800,000 for goodwill generated by Lewis Company.
2. Martin feels that Lewis Company has the ability to generate earnings in excess of a normal return on net identifiable assets.
3. Martin will record amortization expense over a period not to exceed 40 years.
4. Martin Corporation will record $800,000 to goodwill, an intangible asset, which will be reported in its balance sheet

- On March 1, 19X5, Curtis Corporation accepted a $20,000, 6 month, 10% note on account from Gloria Lawless. Assume that Gloria defaults on the note on August 31. The entry to reflect the default will include:

a. Debit note receivable $21,000.

b. Debit accounts receivable $21,000.

c. Debit note receivable $20,000.

d. Debit accounts receivable $20,000.