Q1. Mesquite, Inc. engaged in the following transactions during October:
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Performed services for cash
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$1,840
|
|
Performed services on credit
|
2,100
|
|
Purchased office supplies on account
|
800
|
|
Paid salaries in cash
|
900
|
|
Collected on account
|
600
|
|
Paid on account
|
400
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What is the amount of cash still to be received?
a. $400
b. $1,500
c. $2,300
d. $1,900
Q2. Use this information to answer the following question.
The trial balance for Nowwick Company appears as follows:
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Nowwick Company Trial Balance December 31, 20x5
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Cash
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$ 240
|
|
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Accounts Receivable
|
1,000
|
|
|
Prepaid Insurance
|
100
|
|
|
Supplies
|
300
|
|
|
Office Equipment
|
800
|
|
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Accumulated Depreciation-Office Equipment
|
|
$ 400
|
|
Accounts Payable
|
|
600
|
|
Common Stock
|
|
1,200
|
|
Service Revenue
|
|
1,000
|
|
Salaries Expense
|
200
|
|
|
Rent Expense
|
400
|
|
|
$3,200
|
$3,200
|
If the estimated depreciation for office equipment were $350, the adjusting entry would contain a
a. debit to Accumulated Depreciation-Office Equipment for $350.
b. credit to Accumulated Depreciation-Office Equipment for $350.
c. credit to Office Equipment for $350.
d. credit to Depreciation Expense-Office Equipment for $350.
Q3. Use this balance sheet and income statement to answer the following question. Use ending balances whenever average balances are required for computing ratios.
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National Textile Balance Sheet December 31, 20x5
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|
Assets
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Liabilities
|
|
Current assets
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$12,000
|
Current liabilities
|
$ 8,000
|
|
Investments
|
2,000
|
Long-term liabilities
|
2,000
|
|
Property, plant, and equipment
|
16,000
|
Total liabilities
|
$ 10,000
|
|
Intangible assets
|
10,000
|
|
|
|
Stockholders' Equity
|
|
|
Common stock
|
30,000
|
|
Total liabilities and stockholders' equity
|
$40,000
|
|
Total assets
|
$40,000
|
|
National Textile Income Statement For the Year Ended December 31, 20x5
|
|
Net sales
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$48,000
|
|
Cost of goods sold
|
16,000
|
|
Gross margin
|
$32,000
|
|
Operating expenses
|
22,400
|
|
Net income
|
$ 9,600
|
The asset turnover for National Textile is
a. 0.83 times.
b. 1.00 times.
c. 1.33 times.
d. 1.20 times.