ACC 2 Unit 3.00

Front

On May 20, Dixie Company paid cash to the bond trustee for the annual deposit to the bond sinking fund, $30,000, and recorded interest earned on the bond sinking fund, $2,000. The correct way to record this transaction is:

Back

debit Bond Sinking Fund, $32,000; credit Cash, $30,000, Interest Income, $2,000.

Front

Lindsey Corporation received cash on account from Darla's Shoe Shop, $49, covering Sales Invoice No. 22, $80 ($65 plus sales tax $15), less Credit Memo No. 34 for $30 ($25 plus sales tax $5), less 2% discount, $1, Receipt No. 5. The journal entry to record the transaction is:

Back

debit Cash, $49, Sales Discount-Shoes, $1; credit Accounts Receivable/Darla's Shoe Shop, $50.

Front

Sandra Lee Corporation received cash from Bre Hampton for 100 shares of $60 par value preferred stock at $70 per share for a total of $7,000. The journal entry to record this transaction is:

Back

debit Cash, $7,000; credit Capital Stock-Preferred, $6,000, Paid-in Capital in Excess of Par Value-Preferred, $1,000.

Front

On November 7, Blue Duck Corporation bought back 700 shares of its $11 stated value common stock at $17 per share for a total of $11,900. The correct entry to record this transaction is:

Back

debit Treasury Stock, $11,900; credit Cash, $11,900.

Front

On March 4, Sadie Morgan subscribed for 4,000 shares of BeanBaggie Corporation's common stock at $10 per share. She agreed to pay $20,000 on June 4 and $20,000 on September 4. The correct journal entry for issuing Stock Certificate No. 10 to Sadie Morgan for 4,000 shares of $10 stated value common stock on September 4 for issuance of stock previously subscribed is:

Back

debit Stock Subscribed-Common, $40,000; credit Capital Stock-Common, $40,000.

Front

On October 15, Cooper Corporation received cash from Robbie Lefler for 100 shares of Treasury Stock at $13 per share for a total of $1,300. Treasury Stock was originally bought for $18 per share. The correct entry to record this transaction is:

Back

debit Cash, $1,300, Paid-in Capital from Sale of Treasury Stock, $500; credit Treasury Stock, $1,800.

Front

On December 15, Jones Corporation paid cash to a bond trustee for the annual interest on a bond issue for $1,200. The correct transaction to record paying interest on a bond is:

Back

debit Interest Expense, $1,200; credit Cash, $1,200.

Front

Davis Corporation sold audio equipment on account to Hear All Corporation, $500, plus sales tax, $45, totaling $545, Sales Invoice No. 54. The correct entry to record the transaction is:

Back

debit Accounts Receivable/Hear All Corporation, $545; credit Sales-Audio, $500, Sales Tax Payable, $45.

Front

What is the correct journal entry for receiving cash from Steffi Wallace in payment of stock subscription, $12,000, on May 14? Options: debit Subscriptions Receivable, $24,000; credit Stock Subscribed-Common, $24,000, debit Stock Subscribed-Common, $24,000; credit Subscriptions Receivable, $24,000, debit Subscriptions Receivable, $12,000; credit Cash, $12,000, debit Cash, $12,000; credit Subscriptions Receivable, $12,000

Back

debit Cash, $12,000; credit Subscriptions Receivable, $12,000

Front

How does a positive net income affect the ending balance of Retained Earnings?

Back

It causes the Retained Earnings balance to increase.