Account: Chiller Company

2202 Words9 Pages
Submitted by HOWELL, JONATHAN (Jonathan.Howell001) on 4/11/2012 12:59:22 PM Points Awarded | 20.00 | Points Missed | 5.00 | Percentage | 80.0% | 1. Chiller Company has credit sales of $5.60 million for year 2010. Chiller estimates that 1.32% of the credit sales will not be collected. Historically, 4% of outstanding accounts receivable is uncollectible. On December 31, 2010, the company's Allowance for Doubtful Accounts has an unadjusted credit balance of $3561. Chiller prepares a schedule of its December 31, 2010, accounts receivable by age. Based on past experience, it estimates the percent of receivables in each age category that will become uncollectible. This information is summarized here: Assuming the company uses the percent…show more content…
It traded in an old (similar) machine for a $9,000 trade-in allowance, meaning the company paid $57,000 cash with the trade-in. The old machine cost $44,000 and had accumulated depreciation of $36,000. What is the recorded value of the new machine? A) $8,000 B) $9,000 C) $57,000 D) $65,000 E) $66,000 Points Earned: | 0.0/1.0 | | Correct Answer(s): | D | 10. Extraordinary repairs: A) Are revenue expenditures B) Extend an asset's useful life beyond its original estimate C) Are credited to accumulated depreciation D) Are additional costs of plant assets that do not materially increase the asset's life E) Are expensed as incurred Points Earned: | 1.0/1.0 | | Correct Answer(s): | B | 11. On September 1, 2010, Drill Far Company purchased a tract of land for $2,300,000. The land is estimated to have a salvage value or $50,000, a useful life of four years, and contain an estimated 4,234,000 tons of iron ore. The company also purchased equipment to use in the extraction process that cost $220,450. The company plans to abandon the equipment when the ore is completely mined. During 2010, the company extracted and sold 1.25 million tons of ore. What is the depletion expense recorded for 2010? A) $575,000 B) $679,027 C) $775,000 D) $562,500 E) $600,000 Points Earned: | 0.0/1.0 | | Correct Answer(s): | C | 12. Ace company purchased a machine valued at $320,000 on August 1. The equipment has an estimated useful life of five years or 2.5 million units.
Open Document