Question

43. An amount is deposited in the bank at 16% interest, compounded semi-annually, for two years....

43. An amount is deposited in the bank at 16% interest, compounded semi-annually, for two years. What number of periods and what rate would be used to find the future value of this investment?

a. 16% for 2 periods

b. 8% for 4 periods

c. 8% for 2 periods

d. 16% for 4 periods

Sales on credit at Jones Co. were $750,000 during the period. The company uses the percentage of credit sales method to allow for uncollectible accounts and estimates that 4% of the credit sales will become uncollectible. The current balance of the Allowance for Uncollectible Accounts is an $8,000 debit. For what amount should the Allowance account be adjusted this period?

a. $38,000

b. $30,000

c. $22,000

d. $32,000

46. At Johnson Co., the cost of goods available for sale during the period was $325,000. The total retail selling price for those goods was $500,000. The company had retail sales of $400,000 during the period. What is the estimated cost of the unsold (ending) inventory, using the retail estimation method?

a. $75,000

b. $185,000

c. $65,000

d. $175,000

Jones Co. purchased $1,000 of equipment on credit last month. Jones has just sent the seller a check for $500 toward payment for the equipment. Jones should record a

a. debit to Equipment for $500

b. credit to Accounts Payable for $500

c. debit to Accounts Payable for $500

d. debit to Cash for $500
Business   Accounting   
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Homework Answers

Answer #1
1
Number of periods = 2*2 = 4
Semi-annual rate = 16%/2 = 8%
8% for 4 periods
Option B is correct
2
Bad debts expense = 750000*4% = $30,000
The Allowance account be adjusted for $30,000
Option B is correct
3
Retail price of goods unsold = 500000-400000 = 100000
Estimated cost of the unsold (ending) inventory = 325000*100000/500000= $65,000
Option C is correct
4
Jones should record a debit to Accounts Payable for $500
Option C is correct
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