accounting help A.S.A.P?

1-If a retailer sells goods for a total price of $200, which includes a 5% sales tax, the amount of the sales tax is $9.52.

True

False

2-Unearned revenues should be classified as Other Revenues and Gains on the income statement.

True

False

3-If $150,000 face value bonds are issued at 103, the proceeds received will be $103,000. TRUE OR FALSE

4-If $200,000 par value bonds with a carrying value of $190,400 are redeemed at 97, a loss on redemption will be recorded.

True

False

5- An aging of a company's accounts receivable indicates that $3,000 are estimated to be uncollectible. If Allowance for Doubtful Accounts has a $1,200 debit balance, the adjustment to record bad debts for the period will require a

a. debit to Bad Debts Expense for $3,000.

b. debit to Bad Debt Expense for $4,200.

c. debit to Bad Debts Expense for $1,800.

d. credit to Allowance for Doubtful Accounts for $4,000.

2 Answers

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  • Sandy
    Lv 7
    1 decade ago
    Favorite Answer

    1-If a retailer sells goods for a total price of $200, which includes a 5% sales tax, the amount of the sales tax is $9.52.

    True

    (Sales $190.48 + Sales tax at 5%, $9.52 = Total price $200)

    2-Unearned revenues should be classified as Other Revenues and Gains on the income statement.

    False (Unearned revenue is a current liability)

    3-If $150,000 face value bonds are issued at 103, the proceeds received will be $103,000.

    FALSE

    ($150,000 at 103 gives you proceeds of $150,000 x 1.03 = $515,000)

    4-If $200,000 par value bonds with a carrying value of $190,400 are redeemed at 97, a loss on redemption will be recorded.

    True

    5- An aging of a company's accounts receivable indicates that $3,000 are estimated to be uncollectible. If Allowance for Doubtful Accounts has a $1,200 DEBIT balance, the adjustment to record bad debts for the period will require a

    b. debit to Bad Debt Expense for $4,200.

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  • 1 decade ago

    1) False 200 * 5% = 10.00

    2) False If it is unearned, it does not belong on the income statement.

    3) If you are the issuer, you will be paid $103,000. If you are the bearer of the bond, on redemption you will receive $100,000. Answer is True

    4) True. You are paying 194,000 to retire 190,400 in debt.

    5) C. the full entry is a debit to expense and a credit to reserve.

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