Question

igh Step Shoes, had annual revenues of $197,000, expenses of $109,700, and paid dividends of $22,800 during the current year. The retained earnings account before closing had a balance of $309,000. The ending retained earnings balance after closing is:

Multiple Choice

• $396,300

• $87,300

• $373,500

• $64,500

• $197,000

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Time Remaining 1 hour 44 minutes 48 seconds

01:44:48

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Item 6

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If Bojana Tax Services' office supplies account balance on March 1 was $2,000, the company purchased $400 of supplies during the month, and a physical count of supplies on hand at the end of March indicated $2,100 unused, what is the amount of the adjusting entry for office supplies on March 31?

Multiple Choice

• $2,400

• $3,700

• $2,000

• $300

• $400

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Time Remaining 1 hour 44 minutes 38 seconds

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Item 7

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On September 1, Kennedy Company loaned $132,000, at 9% annual interest, to a customer. Interest and principal will be collected when the loan matures one year from the issue date. Assuming adjustments are only made at year-end, what is the adjusting entry for accruing interest that Kennedy would need to make on December 31, the calendar year-end?

Multiple Choice

• Debit Interest Expense, $11,880; credit Interest Payable, $11,880

• Debit Interest Expense, $3,960; credit Interest Payable, $3,960

• Debit Interest Receivable, $11,880; credit Cash, $11,880

• Debit Interest Receivable, 3,960; credit Interest Revenue, $3,960.

• Debit Cash, $3,960; credit Interest Revenue, $3,960.

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Time Remaining 1 hour 44 minutes 30 seconds

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Item 8

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A physical count of supplies on hand at the end of May for Masters, Inc. indicated $1,247 of supplies on hand. The general ledger balance before any adjustment is $2,070. What is the adjusting entry for office supplies that should be recorded on May 31?

Multiple Choice

• Debit Supplies Expense $2,070 and credit Supplies $2,070.

• Debit Supplies Expense $1,247 and credit Supplies $1,247.

• Debit Prepaid Supplies $823 and credit Supplies Expense $823.

• Debit Supplies Expense $823 and credit Supplies $823.

• Debit Supplies $1,247 and credit Cash $1,247.

Answer 1

1) $373,500

Explanation:

Current year profit = Income - expense

= $197,000 - $109,700

=$87,300

Closing balance of retained earnings:

Current year profit + Opening balance - Dividends declared.

= $87,300 + $309,000 - $22,800

$373,500

2) $300

Adjustment entry = Opening balance + Purchase - Physical balance

= $2,000 + $400 - $2,100

=$300

3) Debit Interest recivable $3,960 credit Interest Income $3,960

Interest receivable = $132,000 * 9% *4/12

=$3,960

The period would be from September 1 to December 31

As the Interest is Income thus, would be credited and Interest receivable is debited as it is asset

4) Debit supplies expense $823 and credit supplies $823.

Explanation:

Loss =. Balance of general ledger - balance of physical count

= $2,070 - $1,243

=$827

As there is loss the amount should be debited and supplies are our assets and thus to reduce the same it should be credited.