Barton Company has a line of credit with Sea View Bank. Barton can borrow up to $219,000 at any time over the course of Year 2. The following table shows the interest rate expressed as an annual percentage along with the amounts borrowed and repaid during the first three months of Year 2. Funds are borrowed or repaid on the first day of each month. Interest is payable in cash on the last day of the month. The interest rate is applied to the outstanding monthly balance. MonthAmountAnnualBorrowed/(Repaid)Interest RateJanuary$ 44,0006%February(6,900)9%March39,0009% Which of the following shows how borrowing the $44,000 on January 1, Year 2 would affect Barton’s financial statements? Balance SheetIncome StatementStatement of Cash FlowsAssets=Liabilities+Stockholders’ EquityRevenues−Expenses=Net IncomeA.44,000=44,000+ − = 44,000 FAB.44,000=44,000+ − = 44,000 IAC.44,000= +44,000 − = 44,000 FAD.44,000= +44,000 − = 44,000 IA

Which of the following statements regarding the Securities and Exchange Commission (SEC) is not true?

On December 31, Year 1, Kardashian Company recorded an adjusting entry to recognize $5,710 of uncollectible accounts expense. Which of the following shows how this entry will affect Kardashian’s financial statements? Balance SheetIncome StatementStatement of Cash FlowsAssets=Liabilities+Stockholders’ EquityRevenues−Expenses=Net IncomeA.$ (5,710)= +$ (5,710) −$ 5,710=$ (5,710)$ (5,710) OAB.$ (5,710)= +$ (5,710) −$ 5,710=$ (5,710) C.$ (5,710)= +$ (5,710) −$ 5,710=$ (5,710)$ (5,710) FAD.$ (5,710)=$ (5,710)+ −$ 5,710=$ (5,710)

Glasgow Enterprises started the period with 80 units in beginning inventory that cost $1.90 each. During the period, the company purchased inventory items as follows: PurchaseNumber of ItemsCost1400$2.402100$2.50360$2.90 Glasgow sold 265 units after purchase 3 for $7.80 each.What is Glasgow’s ending inventory under LIFO?

A machine with a book value of $38,000 is sold for $32,000. Which of the following answers would accurately represent the effects of the sale on the financial statements? Balance SheetIncome StatementStatement of Cash FlowsAssets=Liabilities+Stockholders’ EquityRevenue or Gain−Expense=Net IncomeA.38,000= +38,00038,000− =38,00038,000 IAB.(6,000)= +(6,000) −6,000=(6,000)6,000 OAC.(6,000)= +(6,000) −6,000=(6,000)6,000 IAD.(6,000)= +(6,000) −6,000=(6,000)32,000 IA

At the end of the current accounting period, Ringgold Company recorded depreciation of $15,000 on its equipment. What is the effect of this event on the company’s balance sheet?

Recording an adjustment for product warranties is a claims exchange transaction.

On January 1, Year 5, Raven Limo Service, Incorporated sold a used limo that had cost $80,000 and had accumulated depreciation of $44,000. The limo was sold for $32,400 cash. Which of the following shows how the sale of the limo would affect Raven’s financial statements? Balance SheetIncome StatementStatement of Cash Flows Assets=Liabilities+EquityCash+Book Value of LimoGain−Loss=Net IncomeA.32,400+(36,000)= +(3,600)3,600− =(3,600)32,400 IAB.32,400+(36,000)= +3,6003,600− =3,6003,600 IAC.32,400+(36,000)= +(3,600) −3,600=(3,600) D.32,400+(36,000)= +(3,600) −3,600=(3,600)32,400 IA

The total amount of uncollectible accounts expense recognized over the life of a business will be the smallest under the

On January 1, Year 1 Residence Company issued bonds with a 67,000% 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%. Which of the following shows how the bond issue will affect Residence’s financial statements on January 1, Year 1? Balance SheetIncome StatementStatement of Cash FlowsAssets=Carrying Value Bond Liability+EquityRevenues−Expenses=Net IncomeA.67,000=64,320+2,680 − = 64,320 FAB.64,320=64,320+ − = 64,320 FAC.69,680=69,680+ − = 69,680 FAD.67,000=69,680+ − = 67,000 FA