Question

MULTIPLE CHOICE - (15 x 1 mark5 HALAL already recorded 4 months prepaid insu Aug 1, Corp XYZ receives an annual insurance bill of $20,000. The company has y recorded 4 months prepaid insurance. What additional amount does the company record as a property tax expense on Aug 17 A. $0 B. $1,167 C. $5,000 D. $6,667 E. $20,000 accounts of 17. Accumulated depreciation and accumulated amortization are a fixed asset A. Carrying B. Expense C Revenue D. Contra E. Deferral 18. A liability with no uncertainty about the fact that that a cost will be recorded, only that its value and settlement date are uncertain is called a: A Premium B. Bond Payable C. Accounts Payable D. Contingent Liability E. Provision 19. The total assets of Pitre Limited are $372,000. Its share capital is $136,000 and its retained earnings are $29,000. What is the amount of its total liabilities? A. $165,000 B. $207,000 C. $236,000 D. $372,000 E. $537,000 20. Installment loans with fixed principal portion are repayable in: A. Equal yearly amounts including interest B. Equal yearly amounts less interest C. Equal periodic amounts including interest D. Equal periodic amounts plus interest E. Equal periodic amounts less interest Con table . Which is not a factor when calculating depreciation? A. Residual value B. Cost C. Impairment loss D. Useful life E. Depreciable amount

Answer 1

016 > Exclense should be acowni dia recorded with $201850. So Correct answer is E. 201.000 & Because frepaid Exlense is reduced from the to love Enclense in the profise ilous and Prepaid Exchonse is shown in allet of Balance sheet under wheat asset and in the next year accounting year to which prefaid Erhonse Preseum is transferred to the expense account Example for fy 19-20 - umonths prefaid Eschorse 220000/12 21667X42 6667 Journal Endy would be prefaid Experte Alc. or 6667 e To Exfonte ALC .6667 frout I loss Ale Experle Ale XX hels: fepaid Ecp (6667) xxx in desck yearf420-01 Esdense Ale or 6667. w To prepaid Extense se forofit ILOCALE insernama Exkonse 12333 Hi Repaid of the Begning 6667/201000 6667

deprecielnare allemalked amous I-amorchical eure allumubhd 17. Accumuthed depreciatim a Tare contra accounts of ag depudiatim is also it Meduces the overall a him is a allet account with Credit Babnice uces the overall alset valule accumubhd defree H-Gta ižalian account is Gredited when defe in pocofir llou quounts By reducing accumubled de bole from allet we will get allet food value or care of auret. ak Babnce and Maka debrecili lano depreciatun is debid. unubted debreciatin value o Garorging Value 0 0 18. Aliability with no uncertainity about the fact that a Cost will be recorded only that is value and settlement dale are uncextain called a : D. Contingent liabiling . AS PEx IAS 37 beovisions, Contingent Liabilisies and caringent Alleh. e Contingent liabirry are posible obugations cohose Existence will be conform By crecortan Jusure Erents that are not wholly within the Control of the entity ?! for example! Ingation , case laws are contingen eabilities Contingent liability includes obligations that are not recognise Because their amount Connot be measured herebly or because Settlement is not focobable to Escamble frodick washenk! government Orders.

19751201 YBhout you - $261000 19. Torae liabilities are 37000 So the answer is 0.272.000 6 Because tolae assets are eruae to tothe liabile of Company and force allot of kitre limited is 378000 $ giren son Queslim So tokas liabilitie, of company is - 370000 $ Balance sheet с ч Asset I 319000 $3gow 20. installements of loan coil fized principal Posten in grofaryable in C. Ecuae feriodic amounts including interest o Because installments exte defor payment are depends cefon monkey or yearly so Eruae forodic amount is refaid with infouth Component. Loon installement Contain tuo Component . Principal Peach and inforest Part. principal part will que reduced By paying foimapro put out of torre outstanding Loom to amount

St & Mercieblecement 01. C. impairinum floes is mol a factor cohille Calcutting defacciation because we carrable defucicelim before infament cols. infaviment luisis. Calculated an acruistim value hels defecialin so deforucialin is calcubleed Before Calcubelian of infaviment hels. and. a) residual value (B) Cost o uletue lite E) defriciable amount all are the o important fachosu for Calcublin of depreciatim defreciahm in Cost - Residuas value 3 defoucrable value usotulite