QUESTION 3

The Sonesta Company uses the indirect method for the statement of cash flows. In 2013, they purchased equipment for $10,000 cash. Which of the following statements is TRUE?

$10,000 would be shown as a negative cash flow in the operating activities section. $10,000 would be shown as a negative cash flow in the investing activities section. $10,000 would be shown as a positive cash flow in the investing activities section. $10,000 would be shown as a positive cash flow in the financing activities section.

QUESTION 9

On December 31, 2013, Peterson Sales has a bonds payable balance of $40,000 and a premium on bonds payable of $900. On the balance sheet, how will this information be shown?

$40,000 less premium of $900 for a net balance of $39,100 $40,000 less one-tenth of $900 for a net balance of $39,910 $40,000 only $40,000 plus a premium of $900 for a net balance of $40,900

3 points

QUESTION 10

In which of the following periods should the expense for warranty costs be recorded?

The period when the product is sold The period when the product is repaired or replaced The period when cash is paid to repair or replace the product The period when cash is collected for the sale of the product

QUESTION 20

Landess Corporation currently has 120,000 shares outstanding of $1 par value common stock. The stock was originally issued for $12 per share. On March 15, the board of directors declares a 10% stock dividend when the stock is selling for $16 per share. Which of the following is the correct journal entry to record this transaction?

Debit Common stock $12,000, debit Paid-in capital $180,000 and credit Retained earnings $192,000. Debit Retained earnings $192,000 and credit Common stock $192,000. Debit Retained earnings $192,000, credit Common stock $12,000 and credit Paid-in capital $180,000. Debit Paid-in capital $192,000 and credit Retained earnings $192,000.

QUESTION 22

A corporation declares a dividend of $.75 per share on 12,500 shares of common stock. Which of the following would be included in the entry to record the declaration?

Retained earnings would be debited for $9,375. Paid-in capital in excess of par would be credited for $9,375. Retained earnings would be credited for $9,375. Dividends payable would be debited for $9,375.