ACCT 301B Fall 2008 Midterm A

ACCT 301B Fall 2008 Midterm A - ACCT 301B Fall 2008 Midterm...

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ACCT 301B Fall 2008 Midterm Examination; Closed books and notes; no scrap paper; no programmable calculators or other devices; assigned seats. Use the following information for question 1. Raney Co. is a retail store operating in a state with a 6% retail sales tax. The retailer may keep 3% of the sales tax collected. Raney Co. records the sales tax in the Sales account. The amount recorded in the Sales account during May was $148,400. 1. The amount of sales taxes payable (to the nearest dollar) to the state for the month of May is $_____________________________________________________________________ Required: Show your supporting computations below to receive credit for correct answers. Professor Paul Sheldon Foote, California State University, Fullerton 1
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ACCT 301B Fall 2008 Midterm Examination; Closed books and notes; no scrap paper; no programmable calculators or other devices; assigned seats. 2. Utley Trading Stamp Co. records stamp service revenue and provides for the cost of redemptions in the year stamps are sold to licensees. Utley's past experience indicates that only 90% of the stamps sold to licensees will be redeemed. Utley's liability for stamp redemptions was $7,500,000 at December 31, 2005. Additional information for 2006 is as follows: Stamp service revenue from stamps sold to licensees $5,000,000 Cost of redemptions 3,400,000 If all the stamps sold in 2006 were presented for redemption in 2007, the redemption cost would be $2,500,000. What amount should Utley report as a liability for stamp redemptions at December 31, 2006? $_____________________________________________________________________ Required: Show your supporting computations below to receive credit for correct answers. Professor Paul Sheldon Foote, California State University, Fullerton 2
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ACCT 301B Fall 2008 Midterm Examination; Closed books and notes; no scrap paper; no programmable calculators or other devices; assigned seats. 3.
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ACCT 301B Fall 2008 Midterm A - ACCT 301B Fall 2008 Midterm...

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