QUESTION 19

A check of $75 deposited by a company was returned to the bank for nonsufficient funds. How would this information be included on the bank reconciliation?

		A deduction on the bank side
		An addition on the bank side
		An addition on the book side
		A deduction on the book side

3 points

QUESTION 20

On November 15, 2011, Beta Company purchased 500 shares of Aquarium Suppliers Corporation for a short term investment at $60 per share. (Aquarium Suppliers has 1,000,000 shares of common stock issued and outstanding.) At December 31, 2011, the market value of Aquarium Suppliers was $52 per share. How would these facts be reflected on the financial statements of Beta Company?

		The net value of Trading investments on the balance sheet would remain the same.
		The income statement would include the Unrealized holding loss.
		The net value of Trading investments on the balance sheet would increase.
		The income statement would include Loss on sale of investments.

3 points

QUESTION 21

A company purchased 100 units for $20 each on January 31. It purchased 100 units for $30 on February 28. It sold 150 units for $45 each from March 1 through December 31. If the company uses the Last-In, First-Out inventory costing method, what is the amount of ending inventory on December 31?

		$1,500
		$1,250
		$1,000
		$2,250

3 points

QUESTION 22

An asset costs $80,000 and has a salvage value of $7,000. It has a four-year life. Using double-declining-balance depreciation, Year 2 depreciation would be:

		$15,000.00.
		$15,437.50.
		$20,000.00.
		$18,250.00.

3 points

QUESTION 23

Michelin Jewelers completed the following transactions. Michelin Jewelers uses the perpetual inventory system. On April 2, Michelin sold $9,000 of merchandise to a customer on account with terms of 3/15, n/30. Michelin's cost of the merchandise sold was $5,500. On April 4, the customer reported damaged goods and Michelin granted a $1,000 sales allowance. On April 10, Michelin received payment from the customer. How much cash was received from the customer?

		$8,000
		$8,730
		$7,760
		$2,260