Question

1.A machine with a salvage value of? $2,000 and a cost of? $40,000 was purchased on January? 1, 2012. What is the depreciation expense for 2012 if the company uses straightminusline depreciation for 10? years? A. ?$3,800 B. ?$40,000 C. ?$4,000 D. ?$38,000

2.

A

40?month

insurance policy was purchased for? $2,100 on May 1. How much insurance will be expensed on December? 31?

A.

?$210

B.

?$2,100

C.

?$53

D.

?$420

3.A machine with a cost of? $20,000, a salvage value of? $8,000 and expected life of 15 years was purchased on September 1. For a calendar year?company, the journal entry to record depreciation expense for the first year would be? to:

A.

debit Depreciation? Expense, $200; credit Accumulated? Depreciation, $200.

B.

debit Depreciation? Expense, $67; credit Accumulated? Depreciation, $67.

C.

debit Depreciation? Expense, $267; credit Accumulated? Depreciation, $267.

D.

debit Depreciation? Expense, $333; credit Accumulated? Depreciation, $333.

4.A machine costing $46,000has a life of

10

years. The salvage value is

$12,000.

It was purchased on February 1. The depreciation expense for the calendar year? is: (Do not round any intermediary calculations. Round your final answer to the nearest? dollar.)

A.

$4,217.

B.

$283.

C.

$3,117.

D.

$383.

5.

Of the? following, which is NOT reported on the Balance? Sheet?

A.

Depreciation Expense

B.

equipment

C.

cash

D.

account payable

6.

Express Barber gave 410 haircuts this past month. They charge? $15 per haircut. Expenses incurred during the month were? $3,900 wages,? $318 utilities/water, and? $270 shampoo/styling products.? $2,900 in wages were paid during the? month, the rest of the

wageslong dash—along

with the utilities and?shampoo/styling products were not paid during the month. What is Express? Barber's net income or loss for the? month?

A.

Not enough information provided to calculate net income or loss

B.

?$3,250 net income

C.

?$1,662 net income

D.

?$2,250 net income

7.

Which of the following accounts would NOT appear on a

postminus?closing

trial? balance?

A.

Dividends

B.

Common Stock

C.

Accounts Receivable

D.

Dividends Payable

8.

A company had a normal? $51,000 cash balance on their adjusted trial balance. If? revenues, expenses and dividends respectively were? $91,000; $20,000 and? $3,000 what amount of cash will be found on the

postminus?closing

trial? balance?

A.

?$122,000 normal balance

B.

?$119,000 normal balance

C.

?$51,000 normal balance

D.

?$165,000 normal balance

Answer 1

1.

Annual Depreciation = (Cost - Salvage value)/Useful life

Depreciation expense for 2012 = ($40,000 - $2,000) / 10 years = $38,000/10 years = $3,800

Correct answer is D. $38,000

2.

Insurance amount for 40 months = $2,100

Monthly insurance expense = $2,100/40 months = $52.50

Number of months from May 1 to December 31 = 8 months

Insurance expense on December 31 = 8 months * $52.50 = $420

3.

Annual depreciation = ($20,000-$8,000)/15 years = $800

Depreciation expense from September 1 to December 31 = $800*4 months/12 months = $267

Correct answer is C. debit Depreciation? Expense, $267; credit Accumulated? Depreciation, $267.

4.

Annual depreciation = ($46,000-$12,000)/10 years = $3,400

Depreciation expense from February 1 to December 31 = $3,400*11 months/12 months = $3,117

Hence, correct answer is C. $3,117