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    classify each as it would be reported on a balance sheet.

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    In the space provided, classify each as it would be reported on a balance sheet. Use the following
    code:
    A -----Asset
    L -----Liability
    SE ------ stockholders' equity

    _____1. Accounts Payable
    _____2. Accounts Receivable
    _____3. Buildings
    _____4. Cash
    _____5. Contributed Capital
    _____6. Land
    _____7. Merchandise Inventory
    _____8. Income Taxes Payable

    Part II Multiple choice: Question 9 to 17

    9. National Corp. purchases $1,000 of supplies on credit. As a result its

    a. current assets will increase by $1,000
    b. current assets will decrease by $1,000
    c. current assets will remain the same
    d. total assets will decrease by $1,000

    10. A journal does all of the following except
    a. summarizes all of the transactions that effect one account in a "T-account"
    b. records all the assets of a company
    c. records each day's transactions
    d. records all the revenues and expenses of a company
    11. Which of the following requires a debit?
    a. decrease in assets
    b. decrease in liabilities
    c. increase in liabilities
    d. increase in stockholders' equity
    12. Which of the following requires a credit?
    a. decreases in liabilities
    b. decreases in stockholders' equity
    c. increases to assets
    d. increases to liabilities
    13. ABC Co. received $20,000 from investors and in return issued $20,000 of stock. As a result of this transaction, what journal entry is required?
    a. debit cash $20,000 and credit contributed capital $20,000
    b. debit cash $20,000 and debit contributed capital $20,000
    c. credit cash 20,000 and credit contributed capital $20,000
    d. credit cash $20,000 and debit contributed capital $20,000
    14. National Corporation purchased $10,000 of furnishings and equipment for cash. As a result of this transaction, what journal entry is required?
    a. debit cash $10,000 and credit furnishings and equipment $10,000
    b. debit furnishings and equipment $10,000 and credit cash $10,000
    c. debit furnishings and equipment $10,000 and debit cash $10,000
    d. credit furnishings and equipment $10,000 and credit cash $10,000
    15. XMO, Inc. borrowed $25,000 from a bank, signing a formal agreement to repay the loan plus interest in five years. XMO placed the borrowed money in its checking account. What is the impact of this transaction?
    a. current assets are increased and current liabilities are increased
    b. noncurrent assets are increased and current liabilities are increased
    c. current assets are increased and noncurrent liabilities are increased
    d. noncurrent assets are increased and noncurrent liabilities are increased
    16. The Hawk Co. borrowed $30,000 from a bank, depositing those funds in its bank account and signing a formal agreement to repay the loan in two years. What is the correct journal entry for this transaction?
    a. debit notes payable and credit cash for $30,000
    b. debit notes payable and debit cash for $30,000
    c. credit notes payable and credit cash for $30,000
    d. debit cash and credit notes payable for $30,000
    17. The Enterprise Co. paid $4,000 cash to purchase furnishings and equipment. What is the impact of this transaction?
    a. total assets are decreased
    b. current assets are decreased
    c. current assets stay the same
    d. total assets are increased
    Part III Use the following information from 2003 incomestement for ABC company to complete question number 18-20. Please show your computations.

    2003
    Sales $121,761
    Cost of Goods Sold 71,583
    Other operating costs 37,408
    Income before income tax expense 12,770
    Income tax expense 5,344
    Other expense 196
    Net income $7,230
    2003 Avergage Net Fixed Assets = $44,300

    From the information from above, calculate the following finacial ratios
    18. Calculate Gross Profit Percentage.
    19. Calculate Net Profit Margin.
    20. Calculate Fixed Assets Turnover.
    ________________________________________

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    Practice quiz

    In the space provided, classify each as it would be reported on a balance sheet. Use the following
    code:
    A -----Asset
    L -----Liability
    SE ------ stockholders' equity

    L 1. Accounts Payable
    A 2. Accounts Receivable
    A 3. Buildings
    A 4. Cash
    SE 5. Contributed Capital
    A 6. Land
    A 7. Merchandise Inventory
    L 8. Income Taxes Payable

    Part II Multiple choice: Question 9 to 17

    9. National Corp. purchases $1,000 of supplies on credit. As a result its

    a. current assets will increase by $1,000
    b. current assets will decrease by $1,000
    c. current assets will remain the same
    d. total assets will decrease by $1,000

    10. A journal does all of the following except
    a. summarizes all of the transactions that effect one account in a "T-account"
    b. records all the assets of a company
    c. records each day's transactions
    d. records all the revenues and expenses of a company
    11. Which of the following requires a debit?
    a. decrease in assets
    b. decrease in liabilities
    c. increase in liabilities
    d. ...

    Solution Summary

    This solution is comprised of a detailed explanation to classify each as it would be reported on a balance sheet.

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