On January 1, 2011, Dew Drop Inn borrowed 80,000 at 8 interest. The loan will be repaid with equal annual installment payments of 8,900 made on the last day of each year, which is the companys yearend.
Notes payable at December 31, 2011 equals ________.
A) 80,000 on the income statement
B) 80,000 on the balance sheet
C) 75,958 on the balance sheet
D) 77,500 on the balance sheet
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Q. 2) The control plan called key verification is designed to reduce the possibility that data will be misread or miskeyed during data entry.
Indicate whether the statement is true or false
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Q. 3) Team Shirts, Inc recognized 4,690 of insurance expense for the year. At the beginning of the year, the balance in Prepaid insurance was 400. At the end of the year, the balance was 775.
How is the accounting information for these items reported on the statement of cash flows using the INDIRECT method?
What will be an ideal response?
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Q. 4) Purchases Returns and Allowances is the contra-purchases account to which purchases returns and purchases allowances are credited.
a. True
b. False
Indicate whether the statement is true or false
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Q. 5) The preparation of the statement of cash flows includes the calculation of all of the following EXCEPT the ________.
A) net cash inflows (or outflows) from financing activities
B) net cash inflows (or outflows) from free cash flows
C) net cash inflows (or outflows) from operating activities
D) net cash inflows (or outflows) from investing activities
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Q. 6) Confirm input acceptance is a control that helps ensure input completeness by informing the user that the input has been accepted for processing.
Indicate whether the statement is true or false
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