6 Adjusting journal entries recorded at the end of an accounting period update revenue and expense accounts, as well as asset or liability accounts.
a. true b. false
7To maintain effective internal control, employees responsible for handling cash should have access to the accounting records.
a. true b. false
8Differences between the bank statement and the company’s Cash account are primarily the result of timing errors made by the company.
a. true b. false
9Trading securities are considered to be long-term investments.
a. true b. false
10If credit sales are $2,920,000, then one day’s sale is equal to $8,000.
a. true b. false
11Inventory is presented on the balance sheet at the selling price of the item.
a. true b. false
12In a period of increasing prices, LIFO generally results in a lower tax liability.
a. true b. false
13 Tonga Industries reported the following:
Net Sales$450,000Cost of goods sold$360,000
Operating expenses $60,000Tax Rate40%
The net income is:
A.$180,000.B.$ 30,000.
C.$ 18,000.D.$ 12,000
a. true b. false
7To maintain effective internal control, employees responsible for handling cash should have access to the accounting records.
a. true b. false
8Differences between the bank statement and the company’s Cash account are primarily the result of timing errors made by the company.
a. true b. false
9Trading securities are considered to be long-term investments.
a. true b. false
10If credit sales are $2,920,000, then one day’s sale is equal to $8,000.
a. true b. false
11Inventory is presented on the balance sheet at the selling price of the item.
a. true b. false
12In a period of increasing prices, LIFO generally results in a lower tax liability.
a. true b. false
13 Tonga Industries reported the following:
Net Sales$450,000Cost of goods sold$360,000
Operating expenses $60,000Tax Rate40%
The net income is:
A.$180,000.B.$ 30,000.
C.$ 18,000.D.$ 12,000