Q1. All of the following would be considered Cash or Cash Equivalents for accounting purposes except:
a. furniture and fixtures.
b. credit card slips.
c. money orders.
d. certificates of deposit.
Q2. When a bill is due to be paid, an accounting employee pulls a voucher from the _______ file and prepares a __________ for the treasurer to sign.
a. cash receipts; check
b. tickler; voucher
c. registration; report
d. tickler; check
Q3. When a supplier's invoice indicates terms of 2/15, n/30, and it has just been delivered, the hospitality firm will have to pay full price if payment is not made:
a. after 2 days.
b. after 15 days.
c. after 30 days.
d. within the number of days that it took to ship the goods or supply the services purchased.
Q4. A restaurant submits credit card slips that total $1,000 to American Express for payment. Suppose that American Express charges a 4 percent processing fee. The amount the hotel will receive is:
a. $1,060.
b. $960.
c. $940.
d. $40.
Q5. Net credit sales for the Breakeven Diner for the past year stands at $4,500. If the diner's manager uses the percentage of sales method of estimating bad debt and uses 1.5 percent for this purpose, the amount of bad debt for the year would be:
a. $9.50.
b. $18.40.
c. $45.00.
d. $67.50.
Q6. A 60-day note for $5,000 with an interest rate of 12 percent per annum will have a maturity value of _____________. (Assume that there are 360 days in a year for the purpose of calculating the interest.)
a. $5,000
b. $5,100
c. $5,600
d. $6,300
Q7. Inventory value is used to calculate _____________, which in turn is used to calculate gross profit.
a. cost of goods sold
b. purchases
c. cost of goods used internally
d. sales revenue
Q8. Given the following information, estimate the value of ending inventory using the gross profit method:
Beginning inventory $200
Purchases $50
Sales $100
Gross profit percentage 50%
a. $175
b. $200
c. $225
d. $250
Q9. When a piece of property or equipment is purchased, it is generally recorded at its __________ value.
a. residual
b. cost
c. salvage
d. book
Q10. The Coral Reef Adventure Resort plans to transport guests to its underwater facility in a submarine. The sub cost $250,000, has a salvage value of $10,000, and has an estimated useful life of 48,000 hours, or 6 years' use. During the first year of the sub's operation, it was used for 8,000 hours. Using the straight-line method of depreciation, calculate the sub's depreciation for the first year.
a. $50,000
b. $40,000
c. $36,000
d. $80,000
Q11. The Lagoon Adventure Resort plans to transport guests to its underwater facility in a submarine. The sub cost $250,000, has a salvage value of $10,000, and has an estimated useful life of 40,000 hours, or 5 years' use. During the first year of the sub's operation, it was used for 8,000 hours. Using the double declining balance method of depreciation, calculate the sub's depreciation for the first year.
a. $48,000
b. $92,000
c. $94,000
d. $100,000
Q12. A hotel trades an old van, which originally cost $20,000 and has a net book value of $4,000, for a new van. The new van has a market value of $28,000, and to purchase it, the hotel pays $22,000 in cash as well as turning in the old van. The new van is recorded on the books as having a value of:
a. $28,000.
b. $26,000.
c. $24,000.
d. $22,000.
Q13. Which of the following federal laws covers payroll recordkeeping requirements as well as equal pay for equal work, minimum wage rates, and overtime pay?
a. Federal Insurance Contributions Act
b. Federal Unemployment Insurance Tax Act
c. Fair Labor Standards Act
d. Tax Equity and Fiscal Responsibility Act
Q14. Douglas receives $260 in regular pay per 40-hour week. If he lives in a country where hours in excess of 40 per week are paid at 1.5 times the hourly rate, his overtime rate per hour is:
a. $6.50.
b. $7.00.
c. $7.83.
d. $9.75.
Q15. Assume the FICA tax is 6.2 percent on the first $64,500 of earnings and 1.45 percent on earnings in excess of $64,500. Jean has earnings of $65,000. What is the total FICA tax on Jean's earnings (to the nearest $1)?
a. $935
b. $4,006
c. $4,030
d. $4,112