Accounting Multiple Misc. problemsKnowledgeCats
1. Kennedy Inc. reported the following data:
Net income $118,000
Depreciation Expense $15,000
Loss on Disposal of equipment $10,000
Increase in accounts receivable $7,000
Decrease in accounts payable ($2,000)
Prepare the cash flows for the operating activities under the indirect method as it would appear on the statement of cash flows.
2. For each of the following, identify whether it would be disclosed as an operating, financing, or investing, activity on the statement of cash flows under the indirect method.
-Purchased buildings A. Operating
-Sold patents B. Financing
-Net income C. Investing
-Issued Common Stock D. Would not be reported
-Paid Cash dividends
3. Land costing $46,000 was sold for $79,000 cash. The gain on the sale was reported on the income statement as other income. On the statement of cash flows, what amount should be reported as an investing activity from the sale of land?
4. On January 1, 2012, Valuation Allowance for Trading Investments has a zero balance. On December 31, 2012, the cost of trading securities portfolio was $52,400, and the fair value was $53,000. Prepare the December 31, 2012, adjusting journal entry to record the unrealized gain or loss on the trading investments.
5. Jarvis Corporation makes an investment in 100 shares of Saxton Company's common stock. The stock is purchased for $40 a share plus brokerage fees of $300. Write the journal entry to record this purchase:
6.Match each of the following investment terms with the appropriate definition.
- Equity Securities
- Trading Securities
- Available-for-sale Securities
- Cost Method
A. Preferred and common stock that represent ownership in a company and do not have a fixed maturity date.
B.The method of reporting an investment that represents less than 20% of the voting stock of another company.
C.When using this, dividends are treated as a reduction of the investment.Se
D.Securities not held for trading or to maturity or other strategic reasons.
E.Debt and equity securities purchased and sold to earn short-term profits from changes in the market price.
7.Using a minimum of 3 sentences, describe the relationship between the market rate of interest, the rate of interest on bonds being issued, and the price the bonds sell at.
8. If $3,000,000 of 10% bonds are issued at 95, the amount of cash received from the sale is
9. The adjusting entry to record the amortization of a discount on Bonds Payable is
A.debit Discount on Bonds Payable, credit Interest Expense
B.debit Interest Expense, credit Discount on Bonds Payable
C.debit Interest Expense, credit Cash
D.debit Bonds Payable, credit Interest Expense
10.When a corporation owns less than 20% of the stock of another company, dividend received are not treated as income.
True or False
11.The account Unrealized Gain (Loss) on Trading Securities should be included in the
A.Income Statement as Other Revenue (Expenses)
B.Balance Sheet as an adjustment to the asset account
C.Balance Sheet as an adjustment to Stockholders' Equity
D. Statement of Retained Earnings
- 7 years ago
Purchase the answer to view it