1. Piedmont Company paid to the state $5,800 in sales tax that it had collected from

customers. What are the results of this transaction on its financial statements?

A. Assets will increase. B. Liabilities will decrease. C. Expenses will increase.

D. Revenues will decrease.

2. Nathans, Inc., provides warranties for many of its products. The January 1, 2019, balance of the Estimated Warranty Liability account was $77,000. Based on an analysis of warranty claims during the past several years, this year's warranty provision was estimated to be 0.8 percent of sales. During 2019, the actual costs of servicing products under warranty were $102,000, and sales were $10,600,000. What amount of Warranty Expense will appear on the income statement for 2019?

A. $59,800 B. $77,000 C. $102,000 D. $84,800

3. Refer to question 10. What amount will be reported in the Estimated Warranty Liability account on the December 31, 2019, balance sheet?

A. $59,800 B. $77,000 C. $102,000 D. $84,800

4. At the time that Thanksgiving Company issued a 2-for-1 stock split, the company had 2,000 shares of $10 par value common stock outstanding. Stockholders' equity also included $56,000 of additional paid in capital in excess of par value and $80,000 of retained earnings. Immediately after the stock split,

A. the balance in the common stock account would be $40,000. B. the amount of paid-in capital would be $80,000. C. the balance in the retained earnings account would be $60,000. D. the balance in the common stock account would be $20,000.