Reference no: EM132960128
Questions -
Q1) A company has gross profit of $262,000, other expenses and losses of $34,000, combined selling and administrative expenses of $119,000, and a 20% income tax rate. Based on this information, what is the company's income from operations?
$114,400
$143,000
$87,200
$109,000
Q2) A company that follows GAAP writes off the entire $14,400 balance of a customer's account. What journal entry would be needed?
Dr. Bad debt expense $14,400; Cr. Allowance for doubtful accounts $14,400
Dr. Allowance for doubtful accounts $14,400; Cr. Accounts receivable $14,400
Dr. Cash $14,400; Cr. Accounts receivable $14,400
Dr. Bad debt expense $14,400; Cr. Accounts receivable $14,400
Q3) A company fully acquires a competitor's company for $742,000. The acquired company had assets with a book value of $1,127,000 and a fair value of $1,267,000, while it had liabilities with a book value of $495,000 and a fair value of $514,000. How much should be recorded to the goodwill account due to the company's acquisition?
$11,000
$129,000
$110,000
$0
Q4) A company uses dollar-value LIFO and has inventory at year-end prices of $163,320 in 20X1 and $182,930 in 20X2. If the price index is 100 in 20X1 and 104 in 20X2, what would be the LIFO reserve amount for 20X2?
$6,533
$176,397
$7,036
$175,894
Q5) On August 1, a company purchases inventory for $204,000 by signing a six-month, 9% note. If the company has a December 31 year-end, what adjusting entry should be recorded at December 31?
Dr. Interest expense $15,300; Cr. Discount on notes payable $15,300
Dr. Interest expense $7,650; Cr. Discount on notes payable $7,650
Dr. Interest expense $15,300; Cr. Interest payable $15,300
Dr. Interest expense $7,650; Cr. Interest payable $7,650
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