You and several classmates are studying for the next accounting examination. They ask you to answer the following questions: 1.If cash is borrowed on a $70,000, 9-month, 10% note on July 1, how much interest expense would be incurred by December 31? 2.The cash register total including sales taxes is $42,000, and the sales tax rate is 5%. What is the sales taxes payable? 3.If $60,000 is collected in advance on November 1 for 6-month magazine subscriptions, what amount of subscription revenue should be recognized on December 31?
You and several classmates are studying for the next accounting examination. They ask you to answer the following questions: 1.If cash is borrowed on a $70,000, 9-month, 10% note on July 1, how much interest expense would be incurred by December 31? 2.The cash register total including sales taxes is $42,000, and the sales tax rate is 5%. What is the sales taxes payable? 3.If $60,000 is collected in advance on November 1 for 6-month magazine subscriptions, what amount of subscription revenue should be recognized on December 31?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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- You and several classmates are studying for the next accounting examination. They ask you to answer the following questions:
1.If cash is borrowed on a $70,000, 9-month, 10% note on July 1, how much interest expense would be incurred by December 31?
2.The cash register total including sales taxes is $42,000, and the sales tax rate is 5%. What is the sales taxes payable?
3.If $60,000 is collected in advance on November 1 for 6-month magazine subscriptions, what amount of subscription revenue should be recognized on December 31?
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