46. The asset account Office Supplies has a balance of $815 at the beginning of

Question

46. The asset account Office Supplies has a balance of $815 at the beginning of the year. The amount on hand at the end of the year is $530. The company has calculated the Supplies Expense for the year to be $3,800. Based on this information, what amount of office supplies was purchased during the year?

A. $3,270

B. $4,330

C. $3,515

D. $0

47. The following account balances were listed on the trial balance of Edgar Company at the end of the period:

Account                            Balance

Accounts Payable            $30,600

Cash                                    48,900

Common Stock                30,000

Equipment                        13,500

Land                                    45,000

Notes Payable                  60,000

The company's trial balance is not in balance and the company's accountant has determined that the error is in the cash account. What is the correct balance in the cash account?

A $57,900.

B. $62,100.

C. $31,500.

D. $2,100.

48. Which of the following statements is correct?

A. Cash flows are easily manipulated because they are based on estimates.

B. Accrual-based net income is not easily manipulated because valuation for such items as bad debts and inventory are precise and based on objectively verifiable information.

C. Cash flows are not easily manipulated because they are generated by internal transactions and do not involve external parties.

D. Accrual-based net income can be manipulated because it is based on estimates.

49. Pinkney’s Inc. had income before income tax of $165,500 last quarter and a 34% tax rate. What is the company's net income?

A. $56,270.

B. $221,770.

C. $109,230.

D. $(56,270).

50. A company issues 100,000 shares of preferred stock for $40 per share. The stock has a fixed dividend rate of 5% and a par value of $3 per share. The company records the issuance with a debit to Cash for:

A. $300,000 and a credit to Preferred Stock for $300,000.

B. $4 million, a credit to Preferred Stock for $300,000, and a credit to Additional Paid-in Capital for $3.7 million.

C. $300,000, a debit for $3.7 million to Long-term Investments, a credit to Preferred Stock for $300,000, and a credit to Additional Paid-in Capital for $3.7 million.

D. $4 million and a credit to Preferred Stock for $4 million.

Explanation / Answer

Solution:

Question 48

The answer to the above question is -

D. Accural based income can be manipulated because it is based on estimates.

Question 46 Beginning supplies 815 Add: Purchases x Less: Endig supplies 530 Supplies used 3,800 x = 3,800 + 530 - 815 3,515 The answer to the above question is C. $ 3,515

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