2. The following events have been projected: A. Cash sales and collections from customers totaling $ 980,000 B. Cash payments for operating expenses of $ 560,000 C. Cash payments for income taxes and interest expense of $ 45,000 D. Cash payments of prior period accruals of $ 80,000 E. Borrowed $ 50,000 cash by issuing a note payable F. Cash dividends of $ 20,000
The beginning balance of cash is $ 45,000. What is the budgeted |
ending balance of cash? |
a. |
$ 325,000 |
b. |
$ 370,000 |
c. |
$ 275,000 |
d. |
$ 245,000 |
3. On January 1, a business exchanged a plant asset with a cost of $ 18,000 and accumulated depreciation of $ 16,500 for a similar asset that had a list price of $ 23,000. The business received a trade-in allowance of $ 2,100 on the old plant asset. What was the result of the exchange?
a. A $ 600 gain on the disposal of a plant asset. b. A $ 1,000 unrecognized gain on the exchange of a plant asset. c. A cost basis of $ 22,400 for the new plant asset d. A cost basis of $ 23,600 for the new plant asset
4. Which one of the following is not an objective of a system of internal controls? a. Safeguard company assets b. Overstate liabilities in order to be conservative c. Enhance the accuracy and reliability of accounting records d. Reduce the risks of errors
5. A company’ s past experience indicates that 60 % of its credit sales are collected in the month of sale, 30 % in the next month, and 5 % in the second month after the sale; the remainder is never collected. Budgeted credit sales were: