Small business owners should always: I. open the bank statement and reconcile the bank account. II. pay everything in cash. III. sign every check personally
a. I and II only
b. I and III only
c. II and III only
d. I, II, and III
b
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A company provided $12,000 of consulting services and was immediately paid in cash by the customer. Identify the journal entry below that properly records this transaction.
A.
| Accounts Receivable | 12,000 | |
| Cash | 12,000 |
B.
| Accounts Payable | 12,000 | |
| Consulting Services Revenue | 12,000 |
C.
| Consulting Services Revenue | 12,000 | |
| Cash | 12,000 |
D.
| Cash | 12,000 | |
| Consulting Services Revenue | 12,000 |
E.
| Accounts Receivable | 12,000 | |
| Consulting Services Revenue | 12,000 |
Niagara Art is a new business
During its first year of operations, credit sales were $41,000 and collections of credit sales were $37,000. One account, $700, was written off. Management uses the percent-of-sales method to account for bad debts expense and estimates 2% of credit sales to be uncollectible. Bad debts expense for the first year of operations is ________. A) $120 B) $820 C) $700 D) $1,560
Destiney is opening Destiney's Soul Food Restaurant. She has determined what it costs to produce each dish on the menu, how much overhead she must include in the menu item price, and other costs associated with producing each meal. After doing these computations, she visits several neighboring restaurants and reviews their menus. She returns to her business and prices her menu items similar to the competitors' prices. What type of pricing strategy is she using?
A. Cost-based pricing B. Markup C. Demand-based pricing D. Competition-based pricing
Bat Corporation distributes stock rights with a $20,000 FMV to its common stock shareholders. The $20,000 value of the stock rights at the time of distribution is less than 15% of the value of the underlying stock. Which of the following statements is true?
A. A shareholder cannot allocate any basis to the rights. B. A shareholder must allocate basis to the rights based on the relative FMVs of the stock and the rights. C. The holding period for the rights begins on the day the rights are distributed in all cases. D. The basis in the rights is zero unless a shareholder makes a valid election to allocate basis to the rights.