WSP Accounting Questions and Correct Answers/ Latest Update / Already Graded

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WSP Accounting Questions and Correct
Answers/ Latest Update / Already
Graded
Assume US GAAP to answer this question.




In 2017, $2 million in wages were earned and no cash wages were

paid.


In 2018, $8 million in wages were earned and $7 million in cash

wages were paid.


- Cash wages were used to first pay wages earned in 2017 with the

remainder used to pay wages earned in 2018.


- Any earned but unpaid wages will be paid during the first quarter

of 2019.




Using only the information provided, which of the following

statements is most accurate?

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Liabilities increased by $1.0 million in 2018


Liabilities increased by $3.0 million in 2018


Assets decreased by $5.0 million in 2018


Retained earnings decreased by $10.0 million in 2018


Retained earnings decreased by $7.0 million in 2018


Ans: Liabilities increased by $1.0 million in 2018




A company reported gross profit of $20 million in 2018. In addition, it

recorded the following activities:




Sales and marketing expenses were $5 million.


Interest income was $2 million.


Sold equipment for $5 million that had a net book value of $9 million.


$3 million in preferred stock issuance.