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  11) When comparing net cash provided by operating activities using the indirect versus direct method: A) net cash is higher using the indirect method B) net cash is lower using indirect method C) there is no difference between the two methods D) depreciation expense is used in the direct method.   12) Rick Corporation's Accounts Receivable decreased by $25,000 during the year. What is the adjustment to the cash flow statement when it is prepared by the indirect method? A) Subtract the decrease from the net income in operating activities. B) Add the decrease to the net income in […]

  36) On July 1, Ball Computer Corporation issued 10-year, 8%, $100,000 bonds for 97. Prepare the journal entries to record:   a. Issuance of the bond. b. First semiannual interest period payment including the amortization of the discount using the straight-line method.   37) On January 1, Preston Corporation issued 6%, 20-year bonds at 108. The face value is $450,000 and interest is paid semiannually. Prepare the journal entries to record:   a. Issuance of the bonds. b. First semiannual interest payment and amortization of the premium using the straight-line method. 38) Scooters Doll Flower Company on July 1 […]

  41) The chart of accounts: A) is a numbered list of all of the business' accounts. B) allows accounts to be located quickly. C) can be expanded as the business grows. D) All of the above are correct.   42) A credit to an asset account was posted to a liability account. This error would cause: A) assets to be understated. B) liabilities to be overstated. C) capital to be understated. D) None of the above are correct.   43) The business incurred an expense and paid it immediately. To record this: A) an expense is debited and a […]

    22.1   Learning Objective 22-1   1) A statement comparing data from two or more consecutive periods is called a: A) comparative balance sheet. B) comparative income statement. C) common-size statement. D) both A and B.   2) In a comparative balance sheet, the ending Cash for 2012 was $315,000 and is $270,000 for 2013. The net increase or decrease from 2012 to 2013 is: A) 86.0%. B) 14.3%. C) 26.4%. D) 16.7%.   3) To find the percent of increase or decrease of an item in a comparative balance sheet you use the formula: % change = amount […]

  61) Helton Company has the following information for the current year:   Beginning fixed manufacturing overhead in inventory $95,000 Fixed manufacturing overhead in production 375,000 Ending fixed manufacturing overhead in inventory 25,000     Beginning variable manufacturing overhead in inventory $10,000 Variable manufacturing overhead in production 50,000 Ending variable manufacturing overhead in inventory 15,000   What is the difference between operating incomes under absorption costing and variable costing? A) $65,000 B) $50,000 C) $40,000 D) $5,000 E) $70,000 62) The following information pertains to Brian Stone Corporation:   Beginning fixed manufacturing overhead in inventory $60,000 Ending fixed manufacturing overhead […]