Withdrawals of cash by the owner for personal reasons decrease owner's equity and should be debited directly to the owner's capital account
Indicate whether the statement is true or false
F
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Partners Ken and Macki each have a $40,000 capital balance and share income and losses in a ratio of 3:2 . Cash equals $20,000, noncash assets equal $120,000, and liabilities equal $60,000 . If the noncash assets are sold for $80,000, the Macki's capital account will
a. decrease by $16,000 b. decrease by $24,000 c. increase by $24,000 d. decrease by $40,000
Financing activities include
a. lending money b. acquiring investments c. issuing debt d. acquiring long-lived assets
Courts will enforce contracts for the benefit of all but which of the following?
a. Donee beneficiaries. b. Creditor beneficiaries. c. Incidental beneficiaries. d. Intended beneficiaries.
An income statement for Sam's Bookstore for the first quarter of the year is presented below: Sam's BookstoreIncome StatementFor Quarter Ended March 31Sales $900,000Cost of goods sold 630,000Gross margin 270,000Selling and administrative expenses Selling$100,000 Administration 104,000 204,000Net operating income $66,000 On average, a book sells for $50. Variable selling expenses are $5 per book with the remaining selling expenses being fixed. The variable administrative expenses are 4% of sales with the remainder being fixed. The contribution margin for Sam's Bookstore for the first quarter is:
A. $756,000 B. $144,000 C. $774,000 D. $180,000