In a control matrix, the coding M-1 means:
a. a major control plan
b. a missing control plan
c. process 1 is missing
d. none of the above
(
Q. 2) Cash used for investing activities includes cash ________.
A) collected from customers
B) paid for land
C) paid for interest
D) paid for dividends
(
Q. 3) A printed price of a manufacturer or wholesaler that is subject to trade discounts is called
a. net price.
b. gross price.
c. list price.
d. retail price.
(
Q. 4) David Justice Company incurred the following expenditures related to the purchase and use of a new building that will be used as the growing company's corporate headquarters in Toronto, Canada.
Required: Put an X in the appropriate box to indicate which expenditures should be capitalized and which should be expensed:
Expenditure Capitalize Expense
560,000 spent for building materials (wood & brick)
256,000 spent for labor costs
78,000 architect's fee
80,000 rent for equipment used in the construction
52,000 annual utilities costs to operate the building
(in use on Feb 8)
90 cost to fix a broken window (June 3)
230 cost to clean a stained rug
3,900 annual janitorial costs to keep the building clean
(
Q. 5) When an account receivable that has been written off is subsequently collected, the account receivable must firstbe reinstated before recording the receipt of payment.
a. True
b. False
Indicate whether the statement is true or false
(
Q. 6) A use of cash for investing activities is ________.
A) payment of an account payable
B) payment of dividends
C) cash used to buy equipment
D) cash used to purchase treasury stock
Quick Reply
