Name tB AMEtke Section 0 Date eltl2et Second Examination on Chapters 3, 4, 5, 6

Question

Name tB AMEtke Section 0 Date eltl2et Second Examination on Chapters 3, 4, 5, 6 and 7 L Complete an Multiple Step Classified Income Statement for CCB Ld, for the fiscal year ended August 31, 20xx: Administrative Expenses Cost of Merchandise Sold Interest Income Sales Selling Expenses 203 400 13 II. Journalize the following adjustments as of the end of the 12-month period ended December 31, 20XX: (use two-column journal) A. The building was purchased for $600,000 and has a 50-year life. It was purchased 5 years ago. Compute and journalize depreciation for current accounting year only B Prepaid Insurance totaled $40,000 which had been paid on March 1, for a 20- month period; compute and journalize amount expired. III. MULTIPLE CHOICE-list the letter of the best choice in the space provided at the left of each item or USE SCANTRON per the direction of your instructor: Balance Sheet data for December (end of year); answer multiply choice Items 1, 2,3,4 below from this data Cash Account Receivable Merchandise Inventory Land Note Payable Account Payable Capital Stock Retained Earnings, (January 1) Dividends $20,000 40,000 50,000 40,000 20,000 30,000 60,000 10,000 1,000 1. Total Property, Plant and Equipment is: a. 50,000 b. 40,000 c. $150,000 d. Neither is correct

Explanation / Answer

I CCB Ltd II Journal Entry MultiStep Classified Income Statement 20XX For the year ended August 31, 20XX Dec-31 Depreciation a/c……Dr $12,000 To Accumulated Depreciation-Building a/c $12,000 Sales $400 ($600,000/50 years) Less: Cost of Merchandise Sold $203 Gross Profit: $197 Dec-31 Prepaid Insurance a/c….Dr $40,000 Less: Operating Expense To Insurance a/c $20,000 Administrative expense $9 To Cash a/c $20,000 Selling Expense $13 $22 Operating Profit $175 Add: Interest Income $4 Net Income $179

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