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Marvin Company issues $125,000 of bonds at face value on January 1. The bonds carry a 6% annual stated rate of interest. Interest is payable in cash on December 31 of each year. Which of the following shows the effect of the first interest payment on the financial statements? Balance SheetIncome StatementStatement of Cash FlowsAssets=Liabilities+Stockholders’ EquityRevenue−Expense=Net IncomeA.(7,500)=(7,500)+ − = (7,500) FAB.(7,500)= +(7,500) −7,500=(7,500)(7,500) FAC.(7,500)=(7,500)+ − = (7,500) OAD.(7,500)= +(7,500) −7,500=(7,500)(7,500) OA

Which of the following would be classified as a long-term operational asset?

On January 1, Year 1 Residence Company issued bonds with a $68,000 face value. The bonds were issued at 96 resulting in a 4% discount. They had a 20-year term and a stated rate of interest of 7%. Assuming a straight-line amortization of the discount, the amount of interest expense recognized on the December 31, Year 1 income statement is:

The Miller Company earned $190,000 of revenue on account during Year 1. There was no beginning balance in the accounts receivable and allowance accounts. During Year 1, Miller collected $136,000 of cash from its receivables accounts. The company estimates that it will be unable to collect 3% of its sales on account.What is the net realizable value of Miller’s receivables at the end of Year 1?

Which of the following occurs when a company replenishes its petty cash fund?

Harding Corporation acquired real estate that contained land, building and equipment. The property cost Harding $1,425,000. Harding paid $350,000 and issued a note payable for the remainder of the cost. An appraisal of the property reported the following values: Land, $370,000; Building, $1,100,000 and Equipment, $730,000.What value will be reported for the land on the balance sheet?Note: Round intermediate percentage values to a whole percentage. Do not round other intermediate calculations.

Crowe Company began operations on January 1, Year 1. The company was organized as a sole proprietorship. During Year 1, Crowe acquired $69,000 of capital from John Crowe, the owner. Also, during Year 1 the company earned net income of $39,000. Based on this information, Crowe can withdraw (assume all transactions are cash transactions):

Crowe Company began operations on January 1, Year 1. The company was organized as a sole proprietorship. During Year 1, Crowe acquired $60,000 of capital from John Crowe, the owner. Also, during Year 1 the company earned net income of $40,000 and John Crowe withdrew $35,000 from the business. Based on this information, the company would show:

On January 1, Year 1, Marino Moving Company paid $116,000 cash to purchase a truck. The truck was expected to have a four-year useful life and an $42,000 salvage value. If Marino uses the straight-line method, the amount of book value shown on the Year 2 balance sheet is:

Farmer Company sold a piece of equipment for $6,000. The equipment had an original cost of $34,000 and accumulated depreciation of $31,000 at the time of the sale. Which of the following correctly shows the effect of the sale on the financial statements? Balance SheetIncome StatementStatement of Cash FlowsAssets=Liabilities+Stockholders’ EquityRevenue or Gain−Expense=Net IncomeA.3,000= +3,0003,000− =3,0006,000 OAB.(3,000)= +(3,000) −3,000=(3,000)6,000 IAC.3,000= +3,0003,000− =3,0006,000 IAD.6,000= +6,000 − =6,0006,000 IA