Solutions - Midterm Winter07

Solutions - Midterm Winter07 - Solution of the Mid-term...

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Solution of the Mid-term exam COMM 217 – Winter 2007 Question 1 (18 marks; 1.5 mark each) 1B 2D 3A 4D 5A 6A 7C 8D 9D 10C 11B 12B Question 2 (34 marks) Part 1: 9 marks a- Salaries expense 2,500 Salaries payable 2,500 b- Interest receivable 600 Interest revenue 600 (36,000*10%*2/12) c- Unearned rent revenue 1,600 Rent revenue 1,600 (4,800 /6* 2) d- Amortization Expense 6,000 Accumulated amortization 6,000 e- Retained earning 60,000 Dividend payable 60,000 f- Income tax Expense 4,000 Income tax payable 4,000 1
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MDR Inc. Income Statement For the year ended December 31, 2006 Sales $935,500 Cost of goods sold 590,000 Gross Profit 345,500 Operating expenses: Salary Expense (+ $2,500) 225,000 Other Expense 16,500 Amortization Expense 6,000 Total operating expenses 247,500 Operating income 98,000 Other Income: Interest Income 600 Rent Revenue 1,600 2,200 Net Income before taxes 100,200 Income Tax expense 4,000 Net Income 96,200 Part 3: 13 marks MDR Inc. Balance Sheet As at December 31, 2006 Assets Current Assets Cash $115,000 Accounts Receivable 385,300 Interest Receivable 600 Note Receivable 36,000 Total Current Assets $536,900 Non-Current Assets Building $470,000
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Solutions - Midterm Winter07 - Solution of the Mid-term...

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