Question

Which of the following accounts would not be found in closing entries? a. Service Revenue b....

Which of the following accounts would not be found in closing entries?

a. Service Revenue

b. Wages Expense

c. Accounts Payable

d. Dividends

Payments made by a company to reduce its debt to the bank would be reflected as a cash flow in the investing activities section of the statement of cash flows.

a. True

b. False

Edwards Co. purchased a car wash for $400,000. The appraised value for the land was $50,000, while the building was appraised at $250,000, and the equipment appraised for $200,000. How much of the amount paid for the car wash should be charged to the building account?

a. $250,000

b. $150,000

c. $200,000

d. $225,000

  Use the following information for this question:

                   June 1                 Inventory 100 @ $1.00

                            6                 Purchased 150 @ $1.10

                          13                 Purchased   50 @ $1.20

                          20                 Purchased 100 @ $1.30

                          25                 Purchased   25 @ $1.40                                                              

                           Total Units Sold in June: 300 units

Using the average weighted-average cost method and (if necessary) rounding to the nearest dollar, the cost assigned to the ENDING INVENTORY (not Cost of Goods Sold) would be

a. $216

b. $144

c. $360

d. $346
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Homework Answers

Answer #1

The answer is Option d.

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The answer is Option b.

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Amount charged to building = $400,000 * $250,000 / ($50,000 + $250,000 + $200,000)

= $200,000

The answer is Option c.

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Weighted average cost per unit = Cost of units available for sale / Number of units available for sale

= [(100 * $1) + (150 * $1.1) + (50 * $1.2) + (100 * $1.3) + (25 * $1.4)] / (100 + 150 + 50 + 100 + 25)

= ($100 + $165 + $60 + $130 + $35) / 425

= $1.15

Units in ending inventory = 425 - 300

= 125

Ending inventory = 125 units * $1.15 per unit

= $143.75

= $144

The answer is Option b.

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