WSP ACCOUNTING EXAM
QUESTIONS AND CORRECT
K
C
VERIFIED ANSWERS 100%
LO
GUARANTEED PASS A+
GRADED
YC
D
U
ST
, 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?
K
Liabilities increased by $1.0 million in 2018
Liabilities increased by $3.0 million in 2018
Assets decreased by $5.0 million in 2018
C
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
LO
A company reported gross profit of $20 million in 2018. In addition, it recorded the following
activities:
Sales and marketing expenses were $5 million.
YC
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.
Company's tax rate is 40%.
Calculate the company's net income.
D
$5.4 million
$6.0 million
U
$6.8 million
$7.2 million
$7.8 million - ANS $7,800,000
ST
Gross Profit: 20,000,000
Sales and Marekting Exp: -5,000,000
= Operating Income: 15,000,000
Loss on Sale: -4,000,000
Interest Income: 2,000,000
= Adjusted Income: 13,000,000
Tax: -5,200,000 --> (13,000,000 x 40%)
Net Income: 7,800,000
QUESTIONS AND CORRECT
K
C
VERIFIED ANSWERS 100%
LO
GUARANTEED PASS A+
GRADED
YC
D
U
ST
, 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?
K
Liabilities increased by $1.0 million in 2018
Liabilities increased by $3.0 million in 2018
Assets decreased by $5.0 million in 2018
C
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
LO
A company reported gross profit of $20 million in 2018. In addition, it recorded the following
activities:
Sales and marketing expenses were $5 million.
YC
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.
Company's tax rate is 40%.
Calculate the company's net income.
D
$5.4 million
$6.0 million
U
$6.8 million
$7.2 million
$7.8 million - ANS $7,800,000
ST
Gross Profit: 20,000,000
Sales and Marekting Exp: -5,000,000
= Operating Income: 15,000,000
Loss on Sale: -4,000,000
Interest Income: 2,000,000
= Adjusted Income: 13,000,000
Tax: -5,200,000 --> (13,000,000 x 40%)
Net Income: 7,800,000
