How does the going concern assumption affect accounting for notes payable?

Which of the following statements about par value is true?

On January 1, Year 1, Residence Company issued bonds with a $65,000 face value. The bonds were issued at face value. They had a 20-year term and a stated rate of interest of 7%. Which of the following shows how the payoff of the bond liability will affect Residence’s financial statements on December 31, Year 20 (the maturity date)? Balance SheetIncome StatementStatement of Cash FlowsAssets=Liabilities+Stockholders’ EquityRevenues−Expenses=Net IncomeA. = + − = (65,000) IAB. = + − = (65,000) FAC.65,000=65,000+ − = 65,000 IAD.(65,000)=(65,000)+ − = (65,000) FA

On January 1, Year 2, Kincaid Company’s Accounts Receivable and the Allowance for Doubtful Accounts carried balances of $31,000 and $500, respectively. During Year 2, Kincaid reported $72,500 of credit sales, wrote off $550 of receivables as uncollectible, and collected cash from receivables amounting to $74,550. Kincaid estimates that it will be unable to collect one percent (1%) of credit sales.What effect will recognizing the uncollectible accounts expense for Year 2 have on the elements of the financial statements?

Vargas Company uses the perpetual inventory system and the FIFO cost flow method. During the current year, Vargas purchased 1,900 units of inventory that cost $20 each. At a later date during the year, the company purchased an additional 2,300 units of inventory that cost $21 each. Vargas sold 2,000 units of inventory for $24. What is the amount of cost of goods sold that will appear on the current year’s income statement?

Emir Company purchased equipment that cost $110,000 cash on January 1, Year 1. The equipment had an expected useful life of six years and an estimated salvage value of $8,000. Emir depreciates its assets under the straight-line method. What are the amounts of depreciation expense during Year 3 and the accumulated depreciation at December 31, Year 3, respectively?

Clayton Company borrowed $7,900 from the State Bank on April 1, Year 1. The one-year note carried a 25% rate of interest. The amount of interest expense that Clayton would report in Year 1 and Year 2, respectively would be:Note: Final amounts rounded to the nearest dollar.

How will a certified check be shown on a company’s bank reconciliation?

What is the name used for the type of secured bond that requires a pledge of a designated piece of property in case of default?

On January 1, Year 2, Kincaid Company’s Accounts Receivable and the Allowance for Doubtful Accounts carried balances of $66,800 and $2,000, respectively. During Year 2, Kincaid reported $169,000 of credit sales, wrote off $1,450 of receivables as uncollectible, and collected cash from receivables amounting to $191,100. Kincaid estimates that it will be unable to collect one percent (1%) of credit sales.Which of the following describes the effects of writing off the uncollectible accounts?