TRANSACTION ANALYSIS: Mima Inc. has been in operation for two years. Below find description of activities that occurred during Y8. You might find it helpful to prepare journal entry for each transaction

Transaction 4A - May 1, Y8: Mima signed a $200,000, interest-bearing note payable. It was for two years and specified 6 percent annual interest payable at the maturity date of the note.

Q33. Indicate the account title to be debited by $200,000.

Acct Payable

B.

Cash

C.

Long-term Note Payable

D.

Short-term Note Payable

E.

None

Indicate the account title to be credited.

	A.	Acct Payable
	B.	Cash
	C.	Long-term Note Payable
	D.	Short-term Note Payable
	E.	None

Record interest expense on the note payable discussed in Transaction 4A.

What is the amount of the interest expense?

A.

$16,000

B.

$8,000

C.

$4,000

D.

$1,333

E.

$800

Indicate the account title to be debited.

	A.	Acct Payable
	B.	Cash
	C.	Interest Expense
	D.	Interest Payable
	E.	Note Payable

Indicate the account title to be credited.

	A.	Acct Payable
	B.	Cash
	C.	Interest Expense
	D.	Interest Payable
	E.	Note Payable

Transaction 5A August 15, Y8: At the beginning of Y8, Mima had office supplies inventory of $1,500. On August 15, Y8, Mima purchased office supplies amounting to $3,500 on account.

Prepare journal entries for the purchase of supplies.

Q38. Indicate the account title to be debited by $3,500.

A.	Acct Payable
	B.	Cash
	C.	Cost of Sales
	D.	Supplies
	E.	Supplies Expense

Indicate the account title to be credited.

	A.	Acct Payable
	B.	Cash
	C.	Cost of Sales
	D.	Supplies
	E.	Supplies Expense

Transaction 5B December 31, Y8: At December 31, Y8, the end of the accounting year, a count of office supplies still on hand reflected $1,000. Prepare adjusting entry to adjust the office supplies inventory account. (You might need to refer to Transaction 5A to find related information to answer this question.)

Q40. What is the amount of the adjustment?

	A.	$1,000
	B.	1,500
	C.	$3,500
	D.	$4,000
	E.	$5,000

Indicate the account title to be debited.

	A.	Acct Payable
	B.	Cash
	C.	Prepaid Expense
	D.	Supplies
	E.	Supplies Expense

Indicate the account title to be credited.

	A.	Acct Payable
	B.	Cash
	C.	Prepaid Expense
	D.	Supplies
	E.	Supplies Expense

On December 31, Y10, Mima Inc. had the following balances in its stockholders' equity accounts: Common stock, $50,000 (10,000 shares of $5 par value stock); additional paid-in capital, $100,000; and retained earnings, $50,000.

Q43.Total shareholders equity as of December 31, Y10 is:

	A.	$90,000
	B.	$200,000
	C.	$270,000
	D.	$290,000

During Y11, the above company issued 2,000 additional shares of common stock for $15 per share, reported net income of $60,000 and paid cash dividends of $20,000. Total shareholders equity as of December 31, Y11 is: (You might need to refer to Q43 to find related information to answer this question.)

	A.	$90,000
	B.	$200,000
	C.	$270,000
	D.	290,000