Toro, Inc. paid $8,280 to renew its only insurance policy for three years on Mar

qathlra1397
timer Asked: Jan 8th, 2016

Question Description

Toro, Inc. paid $8,280 to renew its only insurance policy for three years on March 1, year 1, the effective date of the policy. At March 31, year 1, Toro's unadjusted trial balance showed a balance of $345 for prepaid insurance and $8,280 for insurance expense. What amounts should be reported for prepaid insurance and insurance expense in Toro's financial statements for the three months ended March 31, year 1?

Prepaid insurance

Insurance expense

a.☐

$8,050

$345

b.☐

$8,050

$575

c.☐

$8,200

$300

d.☐

$8,250

$230

Jones, a consultant, keeps her accounting records on a cash basis. During year 2, Jones collected $140,000 in fees from clients. At December 31, year 1, Jones had accounts receivable of $24,000. At December 31, year 2, Jones had accounts receivable of $47,000, and unearned fees of $4,200. On an accrual basis, what was Jones's service revenue for year 2?

a.  ☐$129,256

b.  ☐$132,949

c.  ☒$158,800

d.  ☐$166,186

A cash flow of $250,000 may be received by Lydia Nickels, Inc. in one year, two years, or three years, with probabilities of 25%, 60%, and 35%, respectively. The rate of interest on default risk-free investments is 6%.

What is the expected present value of Lydia Nickels' cash flow (in whole dollars)?

  1. ☐$132,380
  2. ☐$266,994
  3. ☐$265,930
  4. ☐$133,550

User generated content is uploaded by users for the purposes of learning and should be used following Studypool's honor code & terms of service.

This question has not been answered.

Create a free account to get help with this and any other question!

Similar Content

Related Tags

Brown University





1271 Tutors

California Institute of Technology




2131 Tutors

Carnegie Mellon University




982 Tutors

Columbia University





1256 Tutors

Dartmouth University





2113 Tutors

Emory University





2279 Tutors

Harvard University





599 Tutors

Massachusetts Institute of Technology



2319 Tutors

New York University





1645 Tutors

Notre Dam University





1911 Tutors

Oklahoma University





2122 Tutors

Pennsylvania State University





932 Tutors

Princeton University





1211 Tutors

Stanford University





983 Tutors

University of California





1282 Tutors

Oxford University





123 Tutors

Yale University





2325 Tutors