Financial Accounting, 8th Edition
8th Edition
ISBN: 9780078025556
Author: Robert Libby, Patricia Libby, Daniel Short
Publisher: McGraw-Hill Education
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Chapter 9, Problem 8P
To determine
Explain whether the operating
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Indicate whether each of the following statements is true or false.
a) Loaning cash to another company is considered a financing activity on the statement of cash flows.
The major difference between treating the extension of credit to a customer as accounts receivable and treating it as notes receivable
b)
is the existence of interest.
c) In a promissory note, the payee issues the note to the maker.
d) Interest rates are always stated on an annual basis, regardless of the length of the note.
e) Accruing interest on a note receivable is considered an asset use transaction.
The type of cash discount where the discount period is counted from the date of invoice is ___.
a.
Ordinary dating
b.
Credit period
c.
Receipt of goods
d.
End of the month
if the company paid the salaries payable in the next period, the transaction will
be as bellow
cash debit, salaries payable credit.
cash debit , salaries credit.
salaries expense debit, cash credit.
salaries payable debit, cash credit.
Note collection in the bank reconciliation will be
Add to the balance per bank.
Deduct from balance per bank.
O Add to the balance per book.
Deduct from balance per book.
cost of goods sold equal to
O Goods available for sale mince beginning inventory.
O Net sale mince goods available for sale
Net purchase mince beginning inventory.
beginning inventory blues net purchase mince ending inventory
Chapter 9 Solutions
Financial Accounting, 8th Edition
Ch. 9 - Prob. 1QCh. 9 - Prob. 2QCh. 9 - Prob. 3QCh. 9 - Prob. 4QCh. 9 - Define working capital. How is working capital...Ch. 9 - Prob. 6QCh. 9 - Define deferred revenue. Why is it a liability?Ch. 9 - Prob. 8QCh. 9 - Prob. 9QCh. 9 - Prob. 10Q
Ch. 9 - When a company signs a capital lease, does it...Ch. 9 - Prob. 12QCh. 9 - Prob. 13QCh. 9 - Prob. 14QCh. 9 - Prob. 15QCh. 9 - Prob. 16QCh. 9 - Prob. 1MCQCh. 9 - Prob. 2MCQCh. 9 - Prob. 3MCQCh. 9 - Prob. 4MCQCh. 9 - Prob. 5MCQCh. 9 - Which of the following transactions would usually...Ch. 9 - How is working capital calculated? a. Current...Ch. 9 - Prob. 8MCQCh. 9 - Prob. 9MCQCh. 9 - Prob. 10MCQCh. 9 - Prob. 1MECh. 9 - Prob. 2MECh. 9 - Prob. 3MECh. 9 - Prob. 4MECh. 9 - Prob. 5MECh. 9 - Prob. 6MECh. 9 - Prob. 7MECh. 9 - Prob. 8MECh. 9 - Prob. 9MECh. 9 - Prob. 10MECh. 9 - Prob. 11MECh. 9 - Prob. 1ECh. 9 - Prob. 2ECh. 9 - Prob. 3ECh. 9 - Prob. 4ECh. 9 - Prob. 5ECh. 9 - Prob. 6ECh. 9 - Prob. 7ECh. 9 - Prob. 8ECh. 9 - Prob. 9ECh. 9 - Prob. 10ECh. 9 - Prob. 11ECh. 9 - Prob. 12ECh. 9 - Prob. 13ECh. 9 - Prob. 14ECh. 9 - Prob. 15ECh. 9 - Prob. 16ECh. 9 - Prob. 17ECh. 9 - Prob. 18ECh. 9 - Prob. 19ECh. 9 - Prob. 20ECh. 9 - Prob. 21ECh. 9 - Prob. 22ECh. 9 - Prob. 23ECh. 9 - Prob. 24ECh. 9 - Prob. 25ECh. 9 - Prob. 1PCh. 9 - Prob. 2PCh. 9 - Prob. 3PCh. 9 - Prob. 4PCh. 9 - Prob. 5PCh. 9 - Prob. 6PCh. 9 - Prob. 7PCh. 9 - Prob. 8PCh. 9 - Prob. 9PCh. 9 - Prob. 10PCh. 9 - Prob. 11PCh. 9 - Prob. 12PCh. 9 - Prob. 13PCh. 9 - Prob. 14PCh. 9 - Prob. 1APCh. 9 - Prob. 2APCh. 9 - Prob. 3APCh. 9 - Prob. 4APCh. 9 - Prob. 5APCh. 9 - Prob. 6APCh. 9 - Prob. 7APCh. 9 - Prob. 8APCh. 9 - Prob. 1CPCh. 9 - Prob. 2CPCh. 9 - Prob. 3CPCh. 9 - Prob. 4CPCh. 9 - Prob. 5CPCh. 9 - Prob. 1CC
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- To demonstrate the difference between cash account activity and accrual basis profits (net income), note the amount each transaction affects cash and the amount each transaction affects net income. A. issued stock for cash $20,000 B. purchased supplies inventory on account $1,800 C. paid employee salaries; assume it was current days expenses $950 D. paid note payment to bank (principal only) $1,200 E. collected balance on accounts receivable $4,750arrow_forwardWhich of the following is considered cash for financial reporting purposes? a. Accounts receivable.b. Investments with maturity dates greater than three months.c. Checks received from customers.d. Accounts payable.arrow_forwardDetermine whether the firm reports each of the following items as part of cash and cash equivalents in the balance sheet. Item Cash or Cash Equivalent? (yes/no) 1. Currency 2. Inventory for sale to customers 3. Balance in savings account 4. Checks 5. Accounts receivable 6. Investments purchased with maturities of less than three months 1. _________________ 2.__________________ 3.__________________ 4.__________________ 5.__________________ 6.__________________arrow_forward
- A company collects an honored note with a maturity date of 24 months from establishment, a 10%interest rate, and an initial loan amount of $30,000. Which accounts are used to record collection of thehonored note at maturity date?A. Interest Revenue, Interest Expense, CashB. Interest Receivable, Cash, Notes ReceivableC. Interest Revenue, Interest Receivable, Cash, Notes ReceivableD. Notes Receivable, Interest Revenue, Cash, Interest Expensearrow_forwardXanthe Corporation had the following transactions occur in the current year: 1. Cash sale of merchandise inventory. 2. Sale of delivery truck at book value. 3. Sale of Xanthe common stock for cash. 4. Issuance of a note payable to a bank for cash. 5. Sale of a security held as an available-for-sale investment. 6. Collection of loan receivable. How many of the above items will appear as a cash inflow from investing activities on a statement of cash flows for the current year? Question 128 options: Five items Four items Three items Two itemsarrow_forward1.How do you consider post-dated check in the statement of financial position? A.cash and cash equivalent B accounts receivable C accounts payable D cash in bank 2.Which of the following describes accrual accounting? A On September 20, the company record sales for the cash received from customers. Delivery of the items will be on October 5. B On September 20, the company record utility expense for the Meralco bills. Payment will be made on due date October 5. C On September 20, the company record sales for the items delivered and collected. D On September 20, the company record rent expense for the rental paid for the current month. 3. Which of the following describes merchandise inventory? A.Bought 5 cars for sale. B.Bought 5 cars for delivery services. C.Bought 5 cars for company's use. D.Bought 5 cars for raffle. 4. Which of the following expenses is a result of association cause and effect method? A.utility expense B. depreciation expense C.salaries expense D. sales…arrow_forward
- Match each description to the appropriate term. Clear All Measures how frequently during the year accounts Net realizable value receivable are being turned into cash Amounts owed by customers Receivables documented by a formal written instrument of credit All money claims against Notes receivable other entities The difference between Accounts receivable accounts receivable and turnover allowance for doubtful accountsarrow_forwardThe Cash account in the general ledger of Hendry Corporation shows a balance of $96,990 at December 31, year 1 (prior to performing a bank reconciliation). The company's bank statement shows a balance of $100,560 at the same date. An examination of the bank statement reveals the following. 1. Deposits in transit amount to $24,600. 2. Bank service charges total $200. 3. Outstanding checks total $31,700. 4. A $3,600 check marked NSF from Kent Company (one of Hendry Corporation's customers) was returned to Hendry Corporation by the bank. This was the only NSF check that Hendry Corporation received during year 1. 5. A canceled check (no. 244) written by Hendry Corporation in the amount of $1,250 for office equipment was incorrectly recorded in the general ledger as a debit to Office Equipment of $1,520, and a credit to Cash of $1,520. In addition to the above information, Hendry Corporation owns the following assets at December 31, year 1: (1) money market accounts totaling $75,000, (2)…arrow_forwardSubject: accountingarrow_forward
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