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20. In a recent year Dillon Corporation had net income of $130,000, interest expense of $20,000, and tax expense of $30,000. What was Dillon

20. In a recent year Dillon Corporation had net income of $130,000, interest
expense of $20,000, and tax expense of $30,000. What was Dillon Corporation’s
times interest earned ratio for the year? 12. Janway sells softball equipment. On November 14, they shipped $1,000
worth of softball uniforms to Chris Middle School, terms 2/10, n/30. On November
21, they received an order from Douglas High School for $600 worth of custom
printed bats to be produced in December. On November 30, Chris Middle School
returned $100 of defective merchandise. Janway has received no payments from
either school as of month end. What amount will be recognized as net accounts
receivable on the Balance Sheet as of November 30?
A.) $1,600
B.) $1,500
C.) $1,000
D.) $900
A.) 6.50
B.) 7.50
C.) 8.00
D.) 9.00
21. A company has an average inventory on hand of $60,000 and its average
days in inventory is 29.2 days. What is the cost of goods sold?
A.) $750,000
B.) $1,752,000
C.) $1,680,000
D.) $876,000
22. On April 5 Sally’s Boutique accepted a VISA card for a $400 purchase. VISA
charges a 2% service fee. The entry to record this transaction would include a
A.) credit to Cash of $392.
B.) debit to Cash of $400.
C.) debit to Service Charge Expense of $8.
D.) credit to Service Charge Expense of $8.
23. The following selected amounts are available for Sanders Company.
Retained earnings (beginning) $1,000
Net loss 100
Cash dividends declared 100
Stock dividends declared 50
What is its ending retained earnings balance?
A.) $850
B.) $900
C.) $750
D.) $800 10. The adjusted trial balance for Lifesaver Corp. at the end of the current year,
2007, contained the following accounts.
5-year Bonds Payable 8% $1,000,000
Bond Interest Payable 50,000
Premium on Bonds Payable 100,000
Notes Payable (3 mo.) 40,000
Notes Payable (5 yr.) 165,000
Mortgage Payable ($15,000 due currently) 200,000
Salaries Payable 18,000
Taxes Payable (due 3/15 of next yr) 25,000
The total long-term liabilities reported on the balance sheet are
A.) $1,365,000
B.) $1,350,000
C.) $1,465,000
D.) $1,450,000

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