Brief Exercises
BE8-1
Presented below are three receivables transactions. Indicate whether these receivables are reported as accounts receivable, notes receivable, or other receivables on a balance sheet. | (a) | Sold merchandise on account for $64,000 to a customer. | | (b) | Received a promissory note of $57,000 for services performed. | | (c) | Advanced $10,000 to an employee.a. accounts receivableb. notes receivablec. other receivables | |
BE9-1
The following expenditures were incurred by Obermeyer Company in purchasing land: cash price $70,000, accrued taxes $3,000, attorneys' fees $2,500, real estate broker's commission $2,000, and clearing and grading $3,500. What is the cost of the land?
Answer: $81,000
Determine the cost of land.
(SO 1)
BE9-2
Neeley Company incurs the following expenditures in purchasing a truck: cash price $30,000, accident insurance $2,000, sales taxes $1,500, motor vehicle license $100, and painting and lettering $400. What is the cost of the truck?
Answer: $34,000
Determine the cost of a truck.
(SO 1)
BE10-1
Buffaloe Company has the following obligations at December 31: (a) a note payable for $100,000 due in 2 years, (b) a 10-year mortgage payable of $300,000 payable in ten $30,000 annual payments, (c) interest payable of $15,000 on the mortgage, and (d) accounts payable of $60,000. For each obligation, indicate whether it should be classified as a current liability. (Assume an operating cycle of less than one year.)
A. Note payable for 100,000 due in 2 years B. A 10 year mortgage payable of $300,000 payable in ten $30,000 annual payments C. Interest payable of $15,000 on the mortgage D. Accounts payable of $60,000.
Answers:
A. NO B. NO C. CURRENT LIABILITY D. CURRENT LIABILITY
Identify whether obligations are current liabilities.
(SO
Presented below are three receivables transactions. Indicate whether these receivables are reported as accounts receivable, notes receivable, or other receivables on a balance sheet. | (a) | Sold merchandise on account for $64,000 to a customer. | | (b) | Received a promissory note of $57,000 for services performed. | | (c) | Advanced $10,000 to an employee.a. accounts receivableb. notes receivablec. other receivables | |
BE9-1
The following expenditures were incurred by Obermeyer Company in purchasing land: cash price $70,000, accrued taxes $3,000, attorneys' fees $2,500, real estate broker's commission $2,000, and clearing and grading $3,500. What is the cost of the land?
Answer: $81,000
Determine the cost of land.
(SO 1)
BE9-2
Neeley Company incurs the following expenditures in purchasing a truck: cash price $30,000, accident insurance $2,000, sales taxes $1,500, motor vehicle license $100, and painting and lettering $400. What is the cost of the truck?
Answer: $34,000
Determine the cost of a truck.
(SO 1)
BE10-1
Buffaloe Company has the following obligations at December 31: (a) a note payable for $100,000 due in 2 years, (b) a 10-year mortgage payable of $300,000 payable in ten $30,000 annual payments, (c) interest payable of $15,000 on the mortgage, and (d) accounts payable of $60,000. For each obligation, indicate whether it should be classified as a current liability. (Assume an operating cycle of less than one year.)
A. Note payable for 100,000 due in 2 years B. A 10 year mortgage payable of $300,000 payable in ten $30,000 annual payments C. Interest payable of $15,000 on the mortgage D. Accounts payable of $60,000.
Answers:
A. NO B. NO C. CURRENT LIABILITY D. CURRENT LIABILITY
Identify whether obligations are current liabilities.
(SO