At the end of the fiscal year, an adjusting entry is made that increases salaries payable and increases salaries expense. This entry is an application of which accounting principle?
a. Full disclosure
b. Materiality
c. Matching
d. Realization
e. Historical cost
C
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Royal Company purchased a dump truck at the beginning of 2014 at a cost of $60,000 . The truck had an estimated life of 6 years and an estimated residual value of $24,000 . On January 1, 2016, the company made major repairs of $20,000 to the truck that extended the life 1 year. Thus, starting with 2016, the truck has a remaining life of 5 years and a new salvage value of $8,000 . Royal uses the
straight-line depreciation method. What is the book value of the truck to be reported on the balance sheet at December 31, 2016? a. $44,000 b. $50,000 c. $56,000 d. $62,000
Hang 12 manufactures surfboards. During the upcoming quarter, it expects to sell 3,800 surfboards, after which it plans to have 500 surfboards remaining in inventory. If it currently has 200 surfboards on hand, how many surfboards will Hang 12 have to produce for the upcoming quarter?
a. 4,100 b. 3,500 c. 3,800 d. 3,100
Infant mortality refers to the high failure rate often encountered in the very early stages of the lifetime of a product
Indicate whether the statement is true or false
Henry promises not to open his Hank's Lunchbox Café before 10:00 A.M. if Isis, who owns Isis's Danish & Donuts next door, promises to close by 4:00 P.M. Henry's consideration is
a. the destruction of a legal relationship. b. the creation of a legal relationship. c. a forbearance. d. an exchange of money.