On November 1, Year 1, Dixon Company paid $20 per share to buy back 2,400 shares of its $8 par value common stock. The stock had originally sold for $15. On December 15, Year 1, Dixon sold 540 shares of the treasury stock at $38 per share. Which of the following shows how the sale of the treasury stock will affect Dixon’s financial statements on December 15, Year 1?

On January 1, Year 1, Parker Company purchased an asset costing $20,000. The asset had an expected five-year life and a $2,000 salvage value. The company uses the straight-line method. What are the amounts of depreciation expense and accumulated depreciation, respectively, that will be reported in the Year 2 financial statements?

On January 1, Year 1, Friedman Company purchased a truck that cost $48,000. The truck had an expected useful life of 8 years and an $8,000 salvage value. Friedman uses the double-declining-balance method. What is the book value of the truck at the end of Year 1?

How does the amortization of the principal balance on an installment note payable affect the amount of interest expense recorded each succeeding year?

On January 1, Year 1, Residence Company issued bonds with a $62,000 face value. The bonds were issued at 104 resulting in a 4% premium. They had a 20-year term and a stated rate of interest of 7%. Based on this information the carrying value of the bond liability on January 1, Year 1, is:

Which of the following statements best describes the term “par value”?

On December 31, Year 1, the Loudoun Corporation estimated that 3% of its credit sales of $112,500 would be uncollectible. Loudoun uses the allowance method. On February 15, Year 2, one of Loudoun’s customers failed to pay his $1,050 account and the account was written off. On April 4, Year 2, this customer paid Loudoun the $1,050.Which of the following correctly states the effect of Loudoun Company writing off the customer’s account? Balance SheetIncome StatementStatement of Cash FlowsAssets=Liabilities+Stockholders’ EquityCash+Net Realizable Value=Accounts Payable+Common Stock+Retained EarningsRevenue−Expense=Net Incomea. + = + + − = b. +(1,050)= + +(1,050)(1,050)− =(1,050) c. +(1,050)=(1,050)+ + − = d. + =1,050+(1,050)+ −1,050=(1,050)

Kellogg, Incorporated purchased 200 shares of its own $20 par value stock for $30 cash per share. Which of the following answers reflects how this purchase of treasury stock would affect Kellogg’s financial statements? Balance SheetIncome StatementStatement of Cash FlowsAssets=Liabilities+Stockholders’ EquityCash+Investment=Accounts Payable+Other Equity Accounts−Treasury StockRevenue−Expense=Net IncomeA.(4,000)+ = + −4,000 − = (4,000) FAB.(6,000)+6,000= + − − = 6,000 IAC.(6,000)+ = + −6,000 − = (6,000) FAD.(4,000)+4,000= + − − = 4,000 IA

On January 1, Year 1, Residence Company issued bonds with a $62,000 face value. The bonds were issued at 104 resulting in a 4% premium. They had a 20-year term and a stated rate of interest of 7%. Based on this information the carrying value of the bond liability on January 1, Year 1, is:

On January 1, Year 2, Kincaid Company’s Accounts Receivable and the Allowance for Doubtful Accounts carried balances of $73,200 and $3,400, respectively. During Year 2, Kincaid reported $201,000 of credit sales, wrote off $1,900 of receivables as uncollectible, and collected cash from receivables amounting to $246,700. Kincaid estimates that it will be unable to collect one percent (1%) of credit sales.What is the net realizable value of receivables that will be reported on Kincaid’s Year 2 balance sheet?