acount-the end of the first weekly pay period of the year, Royal Company’s

Question 1

1. On January 8, the end of the first weekly pay period of the year, Royal Company’s payroll register showed that its employees earned $11,380 of office salaries and $32,920 of sales salaries. What are the entries to record gross salaries only?

   Debit to Salary Expense – Office $11,380 Debit to Salary Expense – Sales $32,920

   Debit to Cash – Office Salaries $11,380 Debit to Cash – Sales Salaries $32,320

   Credit to Cash – Office Salaries $11,380 Debit to Cash – Sales Salaries $32,320

   Debit to Cash – Office Salaries $11,380 Credit to Cash – Sales Salaries $32,320

Question 2

1. The maturity date of a note refers to the date the note must be repaid.

   True

   False

Question 3

1. A company issued 60 shares of $100 par value common stock for $7,000 cash. The journal entry to record the issuance is:

   Debit to Cash $7,000 and credit to Common Stock $7,000

   Debit to Investment in Common Stock $7,000 and credit to Cash $7,000

   Debit to Cash $7,000, credit to Common Stock $6,000, and credit to Paid in Capital in excess of par value, common stock $1,000

   Debit to Cash $7,000, credit to Paid in Capital in excess of par value $6,000, and credit to Common Stock $1,000

Question 4

1. Benson is a partner in B&D Company. Benson’s share of the partnership income is $18,600 and her average partnership equity is $155,000. Her partner return on equity equals 8.33.

   True

   False

Question 5

1. A payroll register usually shows the pay period dates, hours worked, gross pay, deductions, and net pay of each employee for every pay period.

   True

   False

Question 6

1. A patent:
   

   Gives its owner the exclusive right to publish and sell a musical or literary work during the life of the creator plus 70 years.

   Gives its owner an exclusive right to manufacture and sell a patented item or to use a process for 20 years.

   Gives its owner an exclusive right to manufacture and sell a device or to use a process for 50 years.

   Is the amount by which the value of a company exceeds the fair market value of a company’s net assets if purchased separately.

   Gives its owner the exclusive right to publish and sell a musical or literary work during the life of the creator plus 17 years.

Question 7

1. Salvage value is an estimate of an asset’s value at the end of its benefit period.

   True

   False

Question 8

1. A stock split is the distribution of additional shares of stock to stockholders according to their percent of ownership.

   True

   False

Question 9

1. Mayan Company had net income of $132,000. The weighted-average common shares outstanding were 80,000. The company sold 3,000 shares before the end of the year. There were no other stock transactions. The company’s earnings per share is:

   $1.65

   $1.59

   $44.00

   $1.71

Question 10

1. Sellers allow customers to use credit cards:
   

   To avoid having to evaluate a customer’s credit standing for each sale.

   To lessen the risk of extending credit to customers who cannot pay.

   To speed up receipt of cash from the credit sale.

   To increase total sales volume.

   All of these.

Question 11

1. On August 9, Pierce Company receives a $8,500, 90-day, 8% note from customer Eric Simms as payment on his account. What entry should be made on August 9 to record receipt of the note?
   

   Debit Accounts Receivable $8,500; credit Sales $8,500.

   Debit Notes Receivable $8,670; credit Sales $8,670.

   Debit Notes Receivable $8,500; credit Accounts Receivable $8,500.

   Debit Notes Receivable $8,500; credit Sales $8,500.

   Debit Notes Receivable $8,725; credit Interest Revenue $225; credit Accounts Receivable $8,500.

Question 12

1. Intangible assets include:
   

   Patents.

   Copyrights.

   Trademarks.

   Goodwill.

   All of these.

Question 13

1. What is a stock split? How is a stock split different from a stock dividend?

Question 14

1. Trail Company earned $90,000 in income and paid cash dividends of $7,000 to preferred shareholders during the current year. Trail had 15,500 weighted-average shares of common stock outstanding for the year. Calculate the company’s earnings per share.

Question 15

1. Kristen Marks and Shelly Sudd decide to form a partnership on August 1. Marks invests the following assets and liabilities in the new partnership:

   	Market Value
   Land	$80,000
   Building	250,000
   Note payable	114,000

   The note payable is associated with the building and the partnership will assume responsibility for the loan. Sudd invested $100,000 in cash and $95,000 in equipment in the new partnership. Prepare the journal entries to record the two partners’ original investments in the new partnership.

Question 16

From an accounting perspective, discuss the advantages or disadvantages of the various forms of ownership you have learned so far. If you were going to open your own business which form of ownership would you select and why? Be sure to cite your sources in proper APA format.