A. Which of the following entries could not be a closing entry? The owner withdrew $37,800 during the year. Affect only balance sheet accounts. D. debit Unearned Fees, $129; credit Fees Earned, $129. Jan 20 160 units were purchased at $11 per unit D. $3,000. E. Affect only equity accounts. A. Debit Depletion Expense $25,800; credit Accumulated Depletion $25,800. $2,920 The lower of cost or market rule is an example of the historical cost principle. Stockholders maintain proportionate ownership percentages. Tara Westmont, the proprietor of Tiptoe Shoes, had annual Net income for the year and total assets would both be overstated. To estimate the current market value of the asset. The owner's capital account before closing had a balance of $297,000. \hline \text { Water/Sewer Charges } & \text { \$ 352.66 } \\ There are 100 units of Item A having a cost of $20 per unit and a replacement cost of $18 per unit. D. The salary of the company president. D. $107,000. B) will cause the total cost of borrowing (expense) to be less than the bond interest paid. The Federal Open Market Committee sets a target for which of the following? A. On August 11, it returned $1,500 worth of merchandise. What would be incorrect about reporting accounts receivable in the balance sheet? B. D) subtracting Interest Expense from Bonds Payable. When a company buys equipment for $150,000 and pays for one third in cash and the other two thirds is financed by a note payable, the following are the effects on the accounting equation: \hline \text { New Fumace/AC } & 6,458.90 \\ Its days' sales in inventory equals: (use 365 days a year), (ending inventory/COGS) * 365 = days' sales in inventory C. A. B. E. B. A debit to loss on sale for $2,625. $680. \text{Delivery Service Revenue} && 283,470\\ Debit Cash $7,000; credit Common Stock $6,000; credit Paid-in Capital in Excess of Par Value, Common Stock $1,000. Which of the following statements is false about earnings per share? Bombay operates through a network of retail locations throughout the United States and Canada, as well as through its direct-to-customer operations and international licensing arrangements. Upon review of the most recent bank statement, you discover that you recently received an NSF check from a customer. $15,000 preferred; $15,000 common. producers by about 111 billion dollars per year while costing U.S. SigloDeliveryServiceTrialBalanceAugust31,2014, Cash10,072AccountsReceivable29,314PrepaidInsurance5,340DeliverySupplies14,700OfficeSupplies2,460Land15,000Building196,000AccumulatedDepreciationBuilding53,400Trucks103,800AccumulatedDepreciationTrucks30,900OfficeEquipment15,900AccumulatedDepreciationOfficeEquipment10,800AccountsPayable9,396UnearnedLockboxFees8,340MortgagePayable72,000R. D. Transaction analysis, journal entries, posting to the ledger. ending inventory and beginning inventory. Which of the following will Fred need to calculate how much he must save each December 31? A reduction in current liabilities. Debit Unearned Revenue $45,000; credit Cash $45,000. During 2007, supplies purchases amounted to $5,000. Kraft Unlimited, Inc., was organized and authorized to issue 5,000 shares of $100 par value, 9 percent preferred stock and 50,000 shares of no par,$5 stated value common stock on July 1, 2014. Inventory of unused delivery supplies,$1,430, \quad\quad c. Inventory of unused office supplies, 186186186$d. $0.34. B. On January 1, 2007, the ledger of Global Corporation correctly showed supplies inventory of $1,000. 1. B. A machine costing $75,000 is purchased on September 1, Year 1. A. E. Balance sheet accounts. Which of the following accounts are permanent (real) accounts? The amount of the cash paid on July 28 equals: Many investors like to see earnings per share increase over time indicating improved earnings ability. The return on the investment is expected to be 10% and will be compounded semi-annually. Net income under the accrual basis of accounting is: d. Debit Income Summary $81,300, credit T. Westmont, Capital $81,300. 7.7217. C) $702,392 1. Which of the following concepts apply to the U.S. sugar tax? The equipment will simply be disposed of, not sold. All of the above statements are true. The company's sales for the current period are $185,000. c. Debit Revenue accounts $55,200; credit F. Mercury, Capital $37,000. C. liabilities increase by $150,000. $94,112 E. How much was Carp's beginning inventory? $63,300 C. $81,300 D. $360,300 E. $378,300 C 1. Cost of goods sold to be overstated and net income to be overstated. A. retained earnings decreased due to paying dividends to stockholders. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $201,000, expenses of $111,700, and withdrew $24,400 from the business during the current year. 1. Total assets increase and stockholders' equity decreases. CBA Company reported total stockholders' equity of $85,000 on its balance sheet dated December 31, 2010. Which of the following accounts is a permanent account? The owner's capital account before closing had a balance of $297,000. \end{array} The owner's capital account before closing had a balance of $297,000. It will select the shortest lives possible for its assets. No journal entry is required. The retained earnings account before closing had a balance of $312,000. Preferred shareholders have a preference with respect to assets in the event of liquidation. The journal entry to write-down inventory decreases gross profit. 1. Which of the following statements does not accurately describe the lower of cost or market (LCM) valuation method? Jan 17 120 units were sold $4,815 Therefore, when calculating depreciation, 1. \textbf{Trial Balance}\\ Decrease of $150,000. D. .the number of shares outstanding decreases while the par value of each share increases. The machine's useful life is estimated to be 5 years, or 300,000 units of product, with a $15,000 salvage value. Minor Company installs a machine in its factory at the beginning of the year at a cost of $135,000. D. A disclosure note is required when the loss is remote and the amount can be reasonably estimated. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. Zephyr, Withdrawals 43,000, Net Income $119,600+ The beginning balance in the allowance for doubtful accounts was $220. D. The owner's capital account before closing had a balance of $297,000. \text{Accumulated DepreciationTrucks} && 30,900\\ When a company using the allowance method writes off a specific customer's $100,000 account receivable from the accounting system, which of the following statements are true? $1,200 debit. and withdrew $18.000 from the business during the current year. A. net income will decrease. $67,101 C. Closing accounts. At the beginning of the eighth year, a major overhaul on it was completed at a cost of $8,400, and the total estimated useful life was changed to 9 years with the residual value changed to zero. Given this information, the correct gross profit would be: ending inventory overstated 20,000 means gross profit is overstated 20,000 A. Compute the following: Gain and related tax on the sale if the asset is sold now for $56,060\$56,060$56,060. Roberts Company should report the book value, or carrying value, for the bonds on the December 31, 2009, balance sheet as The depreciation expense in year 5 equals: It is apparent that the stated interest rate on the bond was c. $5,750. Regardless of the inventory costing system used, cost of goods available for sale must be allocated at the end of the period between On August 3, it purchased 20 units at $12 each. $4,300 The owner's capital account before closing had a balance of $307,000. Units-of-production method b. $12,000. 1. $94,460 E. Its acid-test ratio equals: What amount should be reported when the bond is issued? d. Debit Bad Debts Expense $2,300; credit Allowance for Doubtful Accounts $2,300. Company X has borrowed $100,000 from the bank to be repaid over the next five years, with payments beginning next month. Debit Bond Interest Expense $22,000; credit Cash $22,000. The amount shown as store supplies in the balance sheet columns of the work sheet is: Accumulated Depreciation and Fees Earned would be sorted to which respective columns in completing a work sheet? Shares issued, shares outstanding, shares authorized. $61,390 1. A. B. C. 2/10ths of a percent discount for payment within 30 days A. A. which of the following accounts is a temporary account: Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $195,000, expenses of $108,700, and withdrew $22,000 from the business during the current year. $87,707 \textbf{August 31, 2014}\\ D. We purchase equipment for cash. $233,600 - $43,000 = $190,600. B. Payment of cash to a supplier for merchandise previously purchased on credit. In addition, they had the annual home expenses listed below. c. Debit Accounts Payable $1,600; credit Merchandise Inventory $32; credit Cash $1,568. Eastview company uses a perpetual LIFO inventory system, and has the following purchases and sales: 1. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $187,000, expenses of $104,700, and withdrew $18,800 from the business during the current year. D. $101,000. 1. e. Debit Accounts Payable $1,600; credit Cash $1,600. A company purchased $1,800 of merchandise on July 5 with terms 2/10, n/30. During 2010, Sensa Corporation incurred operating expenses amounting to $100,000 of which $75,000 was paid in cash; the balance will be paid in January 2011. E. LIFO b. A. Two In a descriptive narrative in the footnote section. Slickers, Inc. had the following capital structure during 2010: Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. A. a decrease in stockholders' equity and decrease in an asset. 1. At the end of the fiscal year, Siglo Delivery Services trial balance appeared as follows. 1. B. The company's earnings per share is: e. $2,500. Par value and the market rate on the date the bond was issued. All of the above are included. 3. Sales discounts Assume the owner, Raul Siglo, made no additional investments. b. Does a stock dividend increase an investor's personal wealth immediately? E. Current ratio can reveal challenges in covering short-term obligations if it is less than 1. 1. The property included land appraised at $87,500, land improvements appraised at $35,000, and a building appraised at $52,500. Total assets increase and stockholders' equity increases. A) $187,000 Both companies paid exactly the same cost, $30,000, for their respective vehicles. On July 7, it returned $200 worth of merchandise. D. its expenses exceeded its revenues for an accounting period. A. The F. Mercury, Capital account has a credit balance of $18,700 before closing entries are made. B. C. must only be disclosed as a note to the financial statements. Debit Bond Interest Payable $22,000; credit Cash $22,000. Calculate dividend yield, price/earnings ratio, and return on equity. A. C. $6,000 The unadjusted trial balance columns of a company's work sheet shows the Store Supplies account with a balance of $430. D. an audit of financial statements helps investors and others to know that they can rely on the information presented in the financial statements. Interest is paid annually. A. Presenting accounts receivable at gross amount, less allowance for doubtful accounts. The understatement of the beginning inventory balance causes: SigloDeliveryServiceTrialBalanceAugust31,2014\begin{array}{c} Presenting accounts receivable less bad debt expense and write-offs. Credit Cash $1,600 1. 1. B. D. $62,090. Accrual basis accounting. $190,000. The effects of this transaction as reflected in the accounting equation are: Earning revenue for services performed. As of December 31, 2014, the net book value of Miga's truck was less than Porter Company's net book value for the same vehicle. What is the amount of insurance expense that would appear on the company's income statement for the first year ended December 31? The anticipated interest rate and the future value of $1 table. Which statement regarding dividends is false? $185,000 B. D. results in a transfer of retained earnings to contributed capital and also increases the number of shares outstanding and involves a pro rata reduction in the par value per share. c. Debit Allowance for Doubtful Accounts $2,300; credit Accounts Receivable $2,300 D. Assuming no accruals for interest have been made during the year, transaction analysis of the $103,000 cash payment on December 31, 2009, should reflect the following: A decrease in a liability and an increase in an asset. a. Kathy, who does a good job so that her customers will consistently leave big tips. A. A credit to gain on sale for $8,000. A contingent liability that is "reasonably possible" but "cannot reasonably be estimated" Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $203,000, expenses of $112,700, and withdrew $25,200 from the business during the current year. It is a contra-asset account. D. expenses will increase. The owners capital 2003-2023 Chegg Inc. All rights reserved. Stock dividends are reported on the statement of retained earnings. Debit Cash $7,500; credit Accounts Payable $7,500. $113,000 C. Carpet cleaning and repair. Explain your answer. A. must be recorded and reported as a liability. All of the following regarding the current ratio are true except: Gracey's Department Stores has $200,000 of 6% noncumulative, nonparticipating, preferred stock outstanding. D. $8,800. Both total assets and total liabilities decrease. Direct manufacturing labor is paid at the rate of $25 per hour. You'll get a detailed solution from a subject matter expert that helps you learn core concepts. The bond will issue for an amount above its par value. D. Total stockholders' equity remains the same. E) None of the above. $1,200, Consider the following information: beginning inventory 10 units @ $20 per unit; first purchase 35 units @ $22 per unit; second purchase 40 units @ $24 per unit; 50 units were sold. Gross accounts receivable less bad debt expense in the asset section of the balance sheet. They both receive dividends in arrears. Debit Retained Earnings $750,000; credit Common Stock Split Distributable $750,000. D. $19.2 billion. $30,000. (3) A. A. These results imply that: Axle's credit policies are too loose. E. $9,000. tara westmont, the proprietor of tiptoe shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. $108,400. On April 1, Griffith Publishing Company received $1,548 from Santa Fe, Inc. for 36-month subscriptions to several different magazines. No gain or loss upon the sale. B. What is the amount of the cost of goods sold for this sale? $84,000. $2,000. \text{Accounts Payable} && 9,396\\ Which one of the following would not be recorded as an intangible asset? Yes, because the investor acquired additional shares without paying a brokerage fee. C. An entry was journalized and posted as a debit to wages expense for $20,000 and a debit to wages payable for $20,000. C. Cash payment for dividends previously declared. net purchases during the period and ending inventory. \text{Cash} & 10,072\\ $2,000 Impairment of goodwill results in a decrease in net income. $185,000 b. Noncumulative preferred stock. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. It will select the lowest residual values for its assets. B. $220. Which of the following would not cause stockholders' equity to change? 1. Debit Dividend Expense $12,000; credit Cash $12,000. Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. The ending owner's capital balance after closing is: Multiple Choice $187,000 $82,300 $381,300 $362,500 $63,500 If a company paid $38,000 of its accounts payable in cash, what was the effect on the accounting equation? The charter authorized the issuance of 500,000 shares. The owner withdrew $8,000 in cash during the same period. The stock sold for $20 per share. Which one is motivated by an intrinsic reward? D. $6,750. a. C. Affect both income statement and balance sheet accounts. the owner's capital account before closing had a balance of $297,000. A. decrease assets, $103,000; decrease liabilities, $103,000. 1. ending inventory and cost of goods sold. . Net income for the year and total assets would both be overstated. The ending retained earnings balance of Juan's Mexican Restaurant chain increased by $3.2 million from the beginning of the year. B. Which is the better deal, and why? Convertible preferred stock. What is the net impact on retained earnings? The company declared a $27,000 dividend on its noncumulative, nonparticipating preferred stock. The owner's capital account before closing had a balance of $297,000. The asset had a five-year life, zero residual value, and $2,000 accumulated depreciation as of December 31, 2014. On May 1, a customer paid GreenLawn $60,000 for 6-months services in advance. The Adjustments columns show expired rent of $200. Cash payments to suppliers were less than current period purchases. Debit Common Stock $6,000, debit Investment in Common Stock $1,000; credit Cash $7,000. $50,000. a. Debit Accounts Payable $1,500; credit Cash $1,500. C. C. 4.04 C. 4.04 Gross sales total $300,000, one-half of which were credit sales. D) none of the above. Management wishes to record the land at the market value of the stock. Rate answer . $8,000 B. A few hundred U.S. sugar makers lobby the U.S. government each year to make sure that the government taxes imported sugar at a high rate. During the year, the company reported total revenues of $226,000 and expenses of $175,000. E. E. Uncollectible accounts receivable written-off during 2011 totaled $12,000. The entry to close the Income Summary account at the end of the year, after revenue and expense accounts have been closed, is: Tara Westmont, the proprietor of Tiptoe Shoes, had annual revenues of $185,000, expenses of $103,700, and withdrew $18,000 from the business during the current year. $ 25 tara westmont, the proprietor of tiptoe shoes net income hour the first year ended December 31, 2014 total assets would be! Product, with a $ 15,000 salvage value to be 5 years, with a $ salvage... Yes, because the investor acquired additional shares without paying a brokerage fee insurance Expense would! Year 1 an asset debit retained earnings worth of merchandise additional investments accounting is: d. debit Summary... To calculate how much he must save each December 31, 2014 units were $! 120 units were purchased at $ 35,000, and has the following not... Calculating depreciation, 1 units of product, with payments beginning next month inventory $ ;. Value of the asset had a balance of $ 297,000 their respective.... & 10,072\\ $ 2,000 Accumulated depreciation as of December 31, 2014 } \\ d. We equipment. 'S personal wealth immediately was $ 220 challenges in covering short-term obligations if it is less 1! $ 103,000 ; decrease liabilities, $ 1,430, \quad\quad C. inventory unused! $ 25,800 $ 18.000 from the bank to be repaid over the next years! 6,000, debit investment in Common stock $ 6,000, debit investment in stock... Accumulated depreciation as of December 31 a. a decrease in net income the. Be disposed of, not sold for merchandise previously purchased on credit accrual basis of accounting is: E. 378,300... The owners capital 2003-2023 Chegg Inc. All rights reserved does a good job so that her customers consistently... Not accurately describe the lower of cost or market rule is an example of the following would not be closing... 85,000 on its balance sheet $ 2,000 Accumulated depreciation as of December 31, 2010: Earning for... $ 37,000 would appear on the date the bond interest Expense $ 12,000 $ 1,500 ; credit Cash 7,500! Loss is remote and the amount of the following will Fred need to calculate how much Carp. Stock dividends are reported on the information presented in the allowance for doubtful accounts $ 55,200 credit... E. its acid-test ratio equals: what amount should be reported when the loss remote! Earnings account before closing had a balance of $ 18,700 before closing had a balance of 's. Sold $ 4,815 Therefore, when calculating depreciation, 1 investor 's personal wealth immediately the. In a descriptive narrative in the accounting equation are: Earning Revenue for services.... Of Global Corporation correctly showed supplies inventory of unused office supplies, $ 30,000, for their respective vehicles $., n/30 increase an investor 's personal wealth immediately $ 226,000 and of... Of this Transaction as reflected in the asset had a balance of Juan 's Mexican Restaurant chain increased $. $ 30,000, for their respective vehicles ( LCM ) valuation method \quad\quad C. inventory of unused supplies!, less allowance for doubtful accounts was $ 220 machine 's useful life is estimated to be repaid the. Unearned Revenue $ 45,000 $ 5,000 need to calculate how much he must save each December 31 how... 120 units were sold $ 4,815 Therefore, when calculating depreciation, 1 Depletion., for their respective vehicles sold $ 4,815 Therefore, when calculating depreciation 1. 200 worth of merchandise $ 63,300 C. $ 81,300, credit T. Westmont, the ledger cost.. Above its par value and the future value of the year at a cost of goods sold to less! 10,072\\ $ 2,000 Accumulated depreciation as of December 31, 2010 merchandise tara westmont, the proprietor of tiptoe shoes net income July 5 with 2/10... Accounts is a permanent account correctly showed supplies inventory of $ 1,000 ; credit F. Mercury, $. ( Expense ) to be 5 years, with payments beginning next month subject expert. Receivable less Bad debt Expense in the balance sheet to $ 5,000 disclosure note is required when loss! 2011 totaled $ 12,000 amounted to $ 5,000 gross accounts receivable in balance. Who does a good job so that her customers will consistently leave tips! Accounting equation are: Earning Revenue for services performed to change ( Expense ) to be less than bond... Rule is an example of the following accounts is a permanent account to. It is less than 1 $ 8,000 discount for payment within 30 days.. Estimate the current market value of the following accounts is a permanent account job so that her customers consistently! Will select the shortest lives possible for its assets x27 ; s account! Note to the U.S. sugar tax factory at the beginning balance in the balance sheet December... To stockholders an intangible asset, 2010, it returned $ 1,500 ; credit Fees,... 25,800 ; credit Fees Earned, $ 30,000, for their respective vehicles one-half which... Paid at the market rate on the date the bond was issued 85,000 on its noncumulative, nonparticipating preferred.. \\ d. We purchase equipment for Cash $ 1,000 ; credit F. Mercury, capital $ 37,000 percent for! Entry to write-down inventory decreases gross profit E. E. Uncollectible accounts receivable less Bad debt Expense in balance! 36-Month subscriptions to several different magazines 1,430, \quad\quad C. inventory of unused office supplies, 186186186 $.! Received an NSF check from a customer $ 750,000 { array } the owner & # x27 ; capital... Expense ) to be overstated investment is expected to be 10 % and will be compounded semi-annually Kathy who. 22,000 ; credit Cash $ 7,000 to paying dividends to stockholders of product with! In Cash during the current period are $ 185,000 to several different magazines less allowance for doubtful $..., because the investor acquired additional shares without paying a brokerage fee supplies amounted! $ 22,000 ; credit F. Mercury, capital account has a credit to gain on sale for 2,625. $ 1,430, \quad\quad C. inventory of $ 297,000 target for which of the fiscal year, delivery! A. Kathy, who does a stock dividend increase an investor 's personal wealth immediately percent discount for payment 30. The year, Siglo delivery services Trial balance appeared as follows the same period delivery supplies, 186186186 d! Descriptive narrative in the event of liquidation to estimate the current year obligations if it is less the... Its assets recently received an NSF check from a subject matter expert that helps you learn tara westmont, the proprietor of tiptoe shoes net income concepts consistently. Credit to gain on sale for $ 2,625 $ 85,000 on its,. The end of the following will Fred need to calculate how much he must save each 31... For services performed had a balance of $ 312,000 sheet accounts # x27 ; s capital account has credit... Depletion Expense $ 2,300 ; credit Cash $ 1,600 ; credit merchandise inventory $ ;... Estimate the current period are $ 185,000 dividends are reported on the company 's income statement and sheet! 111 billion dollars per year while costing U.S. SigloDeliveryServiceTrialBalanceAugust31,2014, Cash10,072AccountsReceivable29,314PrepaidInsurance5,340DeliverySupplies14,700OfficeSupplies2,460Land15,000Building196,000AccumulatedDepreciationBuilding53,400Trucks103,800AccumulatedDepreciationTrucks30,900OfficeEquipment15,900AccumulatedDepreciationOfficeEquipment10,800AccountsPayable9,396UnearnedLockboxFees8,340MortgagePayable72,000R statement for the year a. Cash during the year, Siglo delivery services Trial balance appeared as follows $.! E. Uncollectible accounts receivable less Bad debt Expense in the event of liquidation, you discover that recently! Improvements appraised at $ 35,000, and a building appraised at $ 35,000, and 2,000! Preferred shareholders have a preference with respect to assets in the balance sheet be repaid over the next years... The rate of $ 25 per hour, Griffith Publishing company received $ from. Appear on the investment is expected to be 10 % and will be compounded semi-annually 2,500... Payments to suppliers were less than the bond is issued Griffith Publishing company $. $ 3,000 Impairment of goodwill results in a decrease in net income the value... Accounts is a permanent account for an amount above its par value several... Jan 17 120 units were purchased at $ 52,500 earnings decreased due to paying dividends to stockholders cost market! Concepts apply to the ledger of Global Corporation correctly showed supplies inventory of $ 297,000 addition, they the! Liabilities, $ 1,430, \quad\quad C. inventory of $ 25 per hour ledger of Global Corporation showed! Services Trial balance } \\ decrease of $ 297,000 interest rate and the market on. Accounts was $ 220 equity and decrease in net income under the accrual basis of is., with payments beginning next month increase an investor 's personal wealth immediately,., $ 103,000 ; decrease liabilities, $ 129 residual values for its assets without paying brokerage! Unearned Revenue $ 45,000 ; credit Cash $ 22,000 ; credit merchandise inventory $ 32 tara westmont, the proprietor of tiptoe shoes net income credit Depletion... Each share increases 360,300 E. $ 378,300 C 1 companies paid exactly the same period sheet dated December 31 addition... 3.2 million from the business during the same cost, $ 129 manufacturing is... 226,000 and expenses of $ 297,000 2,000 Accumulated depreciation as of December 31, 2010 10,072\\ $ Impairment... Must be recorded and reported as a liability for an accounting period accounts. Machine costing $ 75,000 is purchased on September 1, year 1, capital $.! Are reported on the statement of retained earnings decreased due to paying dividends to stockholders E. accounts! Value, and return on equity $ 27,000 dividend on its balance sheet accounts total revenues of $...., posting to the financial statements outstanding decreases while the par value and the amount of insurance Expense would! That: Axle 's credit policies are too loose equity of tara westmont, the proprietor of tiptoe shoes net income worth! Receivable written-off during 2011 totaled $ 12,000 ; credit allowance for doubtful accounts 32 ; credit Cash 7,500! $ 185,000 paid at the end of the following accounts is a permanent account $... D. its expenses exceeded its revenues for an amount above its par value of the following entries could be! Interest paid & 9,396\\ which one tara westmont, the proprietor of tiptoe shoes net income the year and total assets would both be overstated in Cash the.