Question

The following information applies to the questions displayed below.] Ceramic Products, Inc. reports these account balanses at January 1. 2018 (shown in alphabetical order) Accounts Payable Accounts Receivable Buildings Capital Stock Cash Equipment Land Notes Payable Retained Earnings 28.000 20,000 153,000 185.000 13,000 20,000 80,000 24,000 49,000 On January 5, Ceramic Products collected $12,000 of its accounts receivable and paid $11,000 on its note payabl 11) In a trial balance prepared on January 6, 2018, the total of the credit column is: A) $297,000. B) $275,000 C) $287,000. D) $286,000. 12) The process of originally recording a business transaction in the accounting records is termed: A) Balancing. B) Posting. C) Footing. (D) Journalizi ng 13) Which of the following situations does not require Empire Company to record an adjusting entry at the end of January? A) At the end of January, Empire Company pays the custodian for January office cleaning services. B) On January 1, Empire Company paid rent for six months on its office building. C) On January 1, Empire Company purchased delivery equipment with an estimated useful life of five years. D) On January 1, Empire Company began delivery service for a large client who will pay at the end of a three-month period. 14) Which of the following statements regarding depreciation is correct? A) Depreciation is only recorded at the end of a year and never over a shorter time period. B) Depreciation is only an estimate of the decline in value of an asset. C) Management must know the exact life of an asset in order to calculate an acceptable depreciation expense. D) Depreciation is an exact calculation of the decline in value of an asset.

Answer 1

Q 11 B 275000

Before adjustments Trial balance would be

Particulars	Debit	Credit
Accounts payable		28000
Accounts Receivable	20000
Building	153000
Capital stock		185000
Cash	13000
Equipment	20000
Land	80000
Notes payable		24000
Retained earnings		49000
	286000	286000

Now when cash realized from accounts receivable of 12000 cash will increase by 12000 and accounts receivable decrease by 12000

and when payment made to notes payable of 11000 cash will decrease by 11000 and notes payable decrease by 11000

So new Trial balance will be

Particulars	Debit	Credit
Accounts payable		28000
Accounts Receivable (20000 -12000)	8000
Building	153000
Capital stock		185000
Cash ( 13000 +12000 -11000)	14000
Equipment	20000
Land	80000
Notes payable (24000 - 11000)		13000
Retained earnings		49000
	275000	275000

Q 12 D Journalizing

Q 13 A  At the end of January ,Empire company pays the custodian for January office cleaning services

For the remaining 3 options adjusting entries will be passed.

Q 14 B Depreciation is only an estimate of the decline in value of asset