Question 13

As of December 31, 2018, Amy Jo's Appliances had unadjusted account balances in accounts receivable of $311,000 and $970 in the allowance for uncollectible accounts, following 2018 write-offs of $6410 in bad debts. An analysis of Amy Jo's December 31, 2018, accounts receivable suggests that the allowance for uncollectible accounts should be 1% of accounts receivable. Bad debt expense for 2018 should be:

$6410.

$3110.

$2140.

None of these answer choices are correct.

1 points

Question 14

Listed below are year-end account balances ($ in millions) taken from the records of Symphony Stores.

Debit

Credit

Accounts receivable-trade

696

Building and equipment

928

Cash-checking

47

Interest receivable

38

Inventory

21

Land

163

Notes receivable (long-term)

457

Petty cash fund

7

Prepaid rent

27

Supplies

9

Trademark

54

Accounts payable-trade

633

Accumulated depreciation

72

Bonds payable (short-term)

479

Allowance for doubltful accounts

17

Dividends payable

26

Common stock

12

Income tax payable

50

Notes payable (long-term)

811

Retained earnings

316

Unearned revenues

31

TOTALS

2447

2447

What would Symphony report as total current assets?

$845 million.

$828 million.

$838 million.

$1623 million.

1 points

Question 15

Cutter Enterprises purchased equipment for $84,000 on January 1, 2018. The equipment is expected to have a five-year life and a residual value of $4200.

Using the double-declining balance method, the book value at December 31, 2019, would be:

$30,240.

$16,800.

$31,440.

$29,340.

1 points

Question 16

Bird Brain Co. reported net income of $46,300 for the year ended December 31, 2018. January 1 balances in accounts receivable and accounts payable were $23,800 and $24,500 respectively. Year-end balances in these accounts were $21,600 and $28,100, respectively. Assuming that all relevant information has been presented (i.e., there are no other operating cash flows), Bird Brain's cash flows from operating activities would be:

$52,100.

$44,900.

$46,300.

$47,700.

1 points

Question 17

Blake Company purchased two identical inventory items. The item purchased first cost $33.00, and the item purchased second cost $34.00. Blake sold one of the items for $62.00. Which of the following statements is true?

Cost of goods sold will be higher if Blake uses the FIFO rather than the weighted-average inventory cost flow method.

The dollar amount assigned to ending inventory will be the same no matter which inventory cost flow method is used.

Gross margin will be higher if Blake uses LIFO rather than the FIFO inventory cost flow method.

Ending inventory will be lower if Blake uses the weighted-average rather than the FIFO inventory cost flow method.

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