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$20,500
$22,000
4. (TCOs B, E) Using accrual accounting, expenses are recorded and
reported only _____. (Points : 5)
when they are incurred, whether or not cash is paid
when they are incurred and paid at the same time
if they are paid before they are incurred
if they are paid after they are incurred
5. (TCO D) Three companies report the same cost of goods available for
sale, but each employs a different inventory costing method. If the price
of goods has increased during the period, then the company using _____.
(Points : 5)
LIFO will have the highest ending inventory
FIFO will have the highest cost of goods sold
All three companies will have the same value for ending inventory.
average cost will have an ending inventory value that falls between
FIFO and LIFO
6. (TCOs A, E) Equipment with a cost of $192,000 has an estimated
salvage value of $18,000 and an estimated life of 4 years or 12,000
hours. It is to be depreciated by the straight-line method. What is the
amount of depreciation for the first full year, during which the
equipment was used 3,300 hours? (Points : 5)
$48,000
$52,500
$49,500
$43,500
7. (TCOs D, G) Joyce Corporation issues 1,000 ten-year, 8%, $1,000
bonds dated January 1, 2007, at 102. The journal entry to record the
issuance will show a _____. (Points : 5)
debit to Cash of $1,020,000
debit to Discount on Bonds Payable for $20,000
credit to Bonds Payable for $1,020,000
credit to Cash for $1,000,0008. (TCO C) Accounts receivable arising
from sales to customers amounted to $80,000 and $70,000 at the
beginning and end of the year, respectively. Income reported on the