On September 3, 2021, Liberty Bank purchased 14,000 shares of eBay stock for $77 per share and classified the investment as TRADING. On September 30, 2021, eBay stock was trading at $70 per share, and on October 31, 2021, eBay stock was trading at $76 per share.The Investment in eBay will be shown on Liberty Bank’s September 30, 2021 Balance Sheets for:$1,078,000$1,064,000$1,029,000$980,000The Unrealized Gain or Unrealized Loss on this trading investment will be shown on Liberty Bank’s September 2021 Income Statement for:$84,000 unrealized gain$98,000 unrealized loss$49,000 unrealized gain$14,000 unrealized lossWhich of the following is TRUE about investments categorized as trading securities?Changes in their market value are reflected in net income.They are purchased to be held to maturity.They are valued on the balance sheet at cost.They can consist of debt, but not equity, securities.1. Which of the following businesses most likely would have a large Unearned Revenue account balance at all times?PharmacyRealtorMagazine publisherDry cleaners Which of the statements is FALSE:Current portion of long-term debt is an example of a current liability.The accrual of interest on note payable results in an increase in liabilities and a decrease in cash. A current liability is created when a customer pays cash for services to be provided in the future.Interest expense is reported under other revenues and expenses on the income statement. Acorn Company borrowed $210,000 cash on October 10, 2021, and signed a 120-day, 4%, note payable with interest payable at maturity. Which of the following would be the required adjusting entry on October 31, 2021? Use 360-day year and round your answer to the nearest dollar.Notes Payable 210,000Dr. Interest Expense 490 Cr. Cash 210,490Interest Expense 490 Cr. Interest Payable 490Interest Payable 723 Cr. Interest Expense 723Interest Expense 2,800 Cr. Interest Payable 2,800On October 1, 2021, Maple Corp signed a one-year, 7%, note payable for $84,000. Assuming that Maple maintains its books on a calendar year basis, how much interest expense should be reported on the 2022 income statement? Round your answer to the nearest dollar.$1,470$2,940$4,410$5,880Chestnut Company borrowed $54,000 cash on October 1, 2021, and signed a nine-month, 10%, note payable with interest payable at maturity. Assuming that adjusting entries have been made monthly, the amount of accrued interest payable to be reported on the December 31, 2021 balance sheet is? Round your answer to the nearest dollar.$1,350$1,800$2,700$4,050$5,400Pine Company borrowed $48,000 cash on August 1, 2021, and signed an eight-month, 9%, note payable with interest payable at maturity. What is the amount of total interest expense on this note? Round your answer to the nearest dollar.$1,800$2,160$2,880$2,700$4,320

Note: We’ll answer the first question since the exact one wasn’t specified. Please submit a new…

Answered: On September 3, 2021, Liberty Bank…

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Related questions

Question

On September 3, 2021, Liberty Bank purchased 14,000 shares of eBay stock for $77 per share and classified the investment as TRADING. On September 30, 2021, eBay stock was trading at $70 per share, and on October 31, 2021, eBay stock was trading at $76 per share.

The Investment in eBay will be shown on Liberty Bank’s September 30, 2021 Balance Sheets for:
1. $1,078,000
2. $1,064,000
3. $1,029,000
4. $980,000

The Unrealized Gain or Unrealized Loss on this trading investment will be shown on Liberty Bank’s September 2021 Income Statement for:
1. $84,000 unrealized gain
2. $98,000 unrealized loss
3. $49,000 unrealized gain
4. $14,000 unrealized loss

Which of the following is TRUE about investments categorized as trading securities?
1. Changes in their market value are reflected in net income.
2. They are purchased to be held to maturity.
3. They are valued on the balance sheet at cost.
4. They can consist of debt, but not equity, securities.

1. Which of the following businesses most likely would have a large Unearned Revenue account balance at all times?

1. Pharmacy
2. Realtor
3. Magazine publisher
4. Dry cleaners

Which of the statements is FALSE:
Current portion of long-term debt is an example of a current liability.
The accrual of interest on note payable results in an increase in liabilities and a decrease in cash.
A current liability is created when a customer pays cash for services to be provided in the future.
Interest expense is reported under other revenues and expenses on the income statement.

Acorn Company borrowed $210,000 cash on October 10, 2021, and signed a 120-day, 4%, note payable with interest payable at maturity. Which of the following would be the required adjusting entry on October 31, 2021? Use 360-day year and round your answer to the nearest dollar.
1. Notes Payable 210,000

Dr. Interest Expense 490

Cr. Cash 210,490

Interest Expense 490

Cr. Interest Payable 490

Interest Payable 723

Cr. Interest Expense 723

Interest Expense 2,800

Cr. Interest Payable 2,800

On October 1, 2021, Maple Corp signed a one-year, 7%, note payable for $84,000. Assuming that Maple maintains its books on a calendar year basis, how much interest expense should be reported on the 2022 income statement? Round your answer to the nearest dollar.
1. $1,470
2. $2,940
3. $4,410
4. $5,880

Chestnut Company borrowed $54,000 cash on October 1, 2021, and signed a nine-month, 10%, note payable with interest payable at maturity. Assuming that adjusting entries have been made monthly, the amount of accrued interest payable to be reported on the December 31, 2021 balance sheet is? Round your answer to the nearest dollar.
1. $1,350
2. $1,800
3. $2,700
4. $4,050
5. $5,400

Pine Company borrowed $48,000 cash on August 1, 2021, and signed an eight-month, 9%, note payable with interest payable at maturity. What is the amount of total interest expense on this note? Round your answer to the nearest dollar.
1. $1,800
2. $2,160
3. $2,880
4. $2,700
5. $4,320

Expert Solution

Trending now

This is a popular solution!

Step by step

Solved in 4 steps

SEE SOLUTION Check out a sample Q&A here

Knowledge Booster

Learn more about

Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.