1) If Ziegler Corporation uses units of production depreciation, what is the depreciation expense for Year 2?
A. $72,000
B. $64,800
C. $66,667
D. $70,000
2) If Ziegler Corporation uses units of production depreciation, what is the depreciation expense for Year 3?
A. $48,000
B. $66,666
C. $60,000
D. $43,200
3) If Ziegler Corporation uses double-declining balance, what is the depreciation expense for Year 1?
A. $120,000
B. $60,000
C. $80,000
D. $133,333
4) If Ziegler Corporation uses double-declining balance, what is the depreciation expense for Year 2?
A. $44,445
B. $40,000
C. $42,000
D. $50,000
1) If Ziegler Corporation uses straight line depreciation, what is the depreciation expense for Year 1?
A. $66,667
B. $133,333
C. $72,000
D. $60,000
2) If Ziegler Corporation uses straight line depreciation, what is the depreciation expense for Year 2?
A. $60,000
B. $66,667
C. $64,800
D. $133,333
3) If Ziegler Corporation uses straight-line depreciation, what is the depreciation expense for Year 3?
A. $66,666
B. $60,000
C. $43,200
D. $133,333
4) If Ziegler Corporation uses units of production depreciation, what is the depreciation expense for Year 1?
A. $72,000
B. $60,000
C. $66,667
D. $80,000
1) If Ziegler Corporation uses double-declining balance, what is the depreciation expense for Year 3?
A. $20,000
B. $2,222
C. $14,815
D. $18,000
2) Bender Incorporated purchased a photocopier for $3,000. Bender also paid sales tax of $180 and a delivery and installation fee of $200. For accounting purposes, the cost of the photocopier will be recorded as:
A. $3,380
B. $3,000.
C. $3,180
D. $3,200
3) On December 31, 2010, Halladay Corporation sold an asset that had a cost of $30,000 and accumulated depreciation of $28,000 for $6,000. This transaction results in:
A. A gain of $4,000
B. A loss of $4,000
C. A gain of $6,000
D. A loss of $2,000
4) Book value is equal to:
A. Cost minus residual value
B. Market value minus book value
C. Cost minus accumulated depreciation
D. Depreciable cost
Please use the following information for questions 1-2
Smith Corporation has two class of stock authorized: common stock and preferred stock. The common stock has a par value of $10 and the preferred stock has a par value of $5.
1) Smith issued 1,000 shares of the common stock for $20 per share. The necessary journal entry is:
A. Cash $20,000
Common Stock $20,000
B. Common Stock $20,000
Cash $20,000
C. Cash $20,000
Common Stock $10,000
PICIEOPV – Common Stock $10,000
D. Common Stock $10,000
PICIEOPV – Common Stock $10,000
Cash $20,000
2) Smith received land valued at $30,000 in exchange for 5,000 shares of preferred stock. The necessary journal entry is:
A. Land $30,000
Preferred Stock $25,000
PICIEOPV $5,000
B. Land $30,000
Common Stock $25,000
PICIEOPV $5,000
C. Land $30,000
Cash $30,000
D. None of the above
3) Under the law, corporations are separate legal entities.
A. True
B. False
4) When a corporation purchases shares of its own stock, it is called:
A. Illegal
B. Fraud
C. Treasury Stock
D. Common Stock
1) What type of account classification is preferred stock?
A. Asset
B. Liability
C. Revenue
D. Equity
2) The relationship between the market rate of interest and the coupon rate of interest determines whether a bond will sell at a discount, at par, or at a premium.
A. True
B. False
3) If a bond is sold at a discount, the discount must be amortized into interest expense over the life of the bond.
A. True
B. False
4) A corporation may finance its assets by:
A. Using past profits
B. Issuing debt
C. Issuing equity
D. All of the above
1) If the market rate of interest is 6% and the coupon rate of interest is 7%, the bond will set at a:
A. A discount
B. At par
C. At a premium
D. Cannot be determined
2) What type of account classification is a bond?
A. Asset
B. Liability
C. Revenue
D. Equity
3) When a corporation purchases shares of its own stock, it is called:
A. Illegal
B. Fraud
C. Treasury Stock
D. Common Stock
4) On December 31, 2010, Halladay Corporation sold an asset that had a cost of $30,000 and accumulated depreciation of $28,000 for $6,000. This transaction results in:
A. A gain of $4,000
B. A loss of $4,000
C. A gain of $6,000
D. A loss of $2,000
