South Company purchased North Company. South Company paid $625,000 cash and assumed all of North Company’s liabilities. On the date of purchase, North’s books showed tangible assets of $530,000, liabilities of $35,000, and equity of $495,000. An appraiser assessed the fair market value of the tangible assets at $575,000 on the acquisition date. Which of the following statements models shows how this event will affect South Company’s financial statements? Balance SheetIncome StatementStatement of Cash FlowsAssets=Liabilities+Stockholders’ EquityCash+Tangible Assets+GoodwillRevenue-Expenses=Net IncomeA.$(625,000)+$575,000+$85,000=$35,000+ – = $(625,000) FAB.$(625,000)+$575,000+$85,000=$35,000+ $35,000- =$35,000$(625,000) IAC.$(625,000)+$575,000+$35,000= + – = $(625,000) IAD.$(625,000)+$575,000+$85,000=$35,000+ – = $(625,000) IA

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

Alpha Associates was organized on January 1, Year 1. Alpha was organized as a partnership. Alpha reported $222,000 of before-tax income during Year 1 and the partners withdrew $41,000 from the company. Assuming a corporate income tax rate of 30% and a personal income tax rate of 15%, the total amount of tax collected by the government is:

On January 1, Year 1, Marino Moving Company paid $116,000 cash to purchase a truck. The truck was expected to have a four-year useful life and an $42,000 salvage value. If Marino uses the straight-line method, the amount of book value shown on the Year 2 balance sheet is:

For which of the following cost flow methods does generally accepted accounting principles require application of the lower-of-cost-or-market rule?

When do the effects of warranty obligations affect the statement of cash flows?

A child with avoidant/restrictive food intake disorder (ARFID) may be referred to occupational therapy primarily to address:

On August 1, Year 1, Gomez Company borrowed $68,000 cash. The one-year note carried a 25% rate of interest. Which of the following shows how the accrual of interest expense in Year 2 will affect Gomez’s financial statements? Balance SheetIncome StatementStatement of Cash Flows Assets = Liabilities +Stockholders’ Equity Revenues− Expenses = Net IncomeA. =9,919+(9,919) −9,919=(9,919)(9,919) OAB. =9,919+(9,919) −9,919=(9,919) C. =7,081+(7,081) −7,081=(7,081)(7,081) OAD. =7,081+(7,081) −7,081=(7,081)

Craig Company issued a discount note for cash. How does this event affect Craig’s financial statements? Balance SheetIncome StatementStatement of Cash FlowsAssets=Liabilities+Stockholders’ EquityRevenue−Expense=Net Incomea.Increase= +IncreaseIncrease− =IncreaseIncrease OAb.Increase=Increase+Decrease −Increase=DecreaseIncrease FAc.Increase=Increase+ − = Increase FAd.Increase=Increase+ − = Increase OA

How is a customer’s NSF check reflected on a bank reconciliation?