Identify all transactions that will require adjusting entries at the end of the calendar year.

1. Issued $7,000,000, 5% 20-year bonds payable at face value. The bonds will pay interest semiannually on April 1st and October 1st.

2. Made $50,000 credit purchase of inventory. Payment is due next year.

3. Sold $105,000 credit sales in the middle of the year in exchange for a 6%, one-year note.

4. Declare and paid $100,000 cash dividends.

5. Prepaid $20,000 one-year insurance in the middle of the year.

6. Received $80,000 advance payment from a customer for products to be delivered next year.

7. Purchased (in the middle of the year) $175,000 of office equipment and transportation vehicles that are estimated to have eight years of service life with $25,000 salvage value.

8. Issued 200,000 shares of common stock in exchange for $5,000,000 cash.

Group of answer choices

1, 3, 5, 6, 7, 8

1, 2, 5, 6, 7

1, 2, 3, 5, 6, 7

1, 3, 5, 6, 7

Which are false about the balance sheet?

1. It shows how much assets are financed by owners.
2. It shows economic resources and claims to economic resources.
3. It is not based on accrual basis.
4. It classifies assets and liabilities into operating, investing and financing activities.
5. It presents financial position of a company at a point in time.
6. It is a change/flow statement.

Group of answer choices

1, 2, 6

2, 5, 6

1, 3, 4

3, 4, 6