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    Sample Test

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    Nhã An

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    Sample Test

    Uploaded by

    Nhã An
    17 views3 pages

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    Copyright:

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    17 views3 pages

    Sample Test

    Uploaded by

    Nhã An

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    of 3

    SAMPLE TEST

    Question 1: Dominican Appliance Mart began operations on May 1. It uses a periodic inventory
    system. During May, the company had the following purchases and sales for its Model 25 Sureshot
    camera

    Date Description Unit Unit Cost/Selling


    Price
    May 1 Purchase 7 $4,600
    May 4 Sale 4 $6,000
    May 8 Purchase 8 $5,100
    May 12 Sale 5 $6,200
    May 15 Purchase 6 $5,520
    May 25 Sale 8 $7,000
    a. Determine the ending inventory and COGS under a periodic inventory system using FIFO.
    b. Determine the ending inventory and COGS under a periodic inventory system using
    moving average cost
    c. List the advantage and disadvantage of FIFO and moving average cost.

    Question 2: The following are selected transactions of Deok-moon Group. This company
    prepares financial statement quarterly.
    Jan. 02 Purchased merchandise on account from Nan Company, $30,000, terms 2/10, n/30.
    (Deok-moon uses the perpetual inventory system)
    Feb. 01 Issued a 9%, 3-month, 30,000 note to Nan in payment of account.
    Mar. 31 Accurued interest on Nan note.
    May 01 Paid face value and interest on Nan note.
    July 01 Purchased equipment from J Equipment paying $11,000 in cash and signing a 10%, 3
    month, $60,000 note.
    Sept. 30 Prepare financial statements.
    Oct. 1 Paid face value and interest on J Equipment note.
    a. Prepare journal entries for the listed transactions and events
    b. What is total interest expense for the year?
    Question 3: Ho Publiser, uses the allowance method to estimate uncollectible accounts
    receivable. The company produced the following aging of the account receivable at year-end.
    Number of Days Outstading
    Total 0-30 31-60 61-90 91-120 Over 120
    Account 200,000 77,000 46,000 39,000 23,000 15,000
    Receivable
    % 1% 4% 5% 8% 20%
    uncollectible
    Estimated
    bad debts
    a. Calculate the total estimated bad debts based on the above information
    b. Prepare the year end adjusting journal entry to record the bad debts using the aged
    uncollectible account receivable determined in (a). Assume the current balance in
    Allowance for Doutful Accounts is a $8,000 debit.
    c. Of the above account, $5,000 is determined to be specifically uncollectible. Prepare the
    journal entry to write off the uncollectible account.
    d. The company collects $5,000 subsequently on a specific account that had previously been
    determined to be uncollectible in (c). Prepare the journal entries neccessary to restore
    the account and record the cash collection.

    Question 4: Yang purchased a delivery truck for $38,000 on January 1, 2020. The truck has an
    expected residual value of $6,000 and is expected to be driven 100,000 miles over its estimated
    useful life of 8 years. Actual miles driven were 15,000 in 2020 and 12,000 in 2021.
    a. Compute depreciation expense for 2020 and 2021 using (1) straight-line method, (2) the
    units of activity method, and (3) the double-declining-balance method.
    b. Assume that Yang uses the straight-line method.
    (1) Prepare the journal entry to record 2020 depreciation.
    (2) Prepare the journal entry to record sale equipment if the equipment sold in year 3.

    Question 5: The comparative statements of Lakers Tool SA are presented below.

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