Changes in the Balance Sheet Accounts at June 30, 2014

question 69

Multiple Choice

Changes in the balance sheet accounts at June 30, 2014 and 2015 for the Poker Company are presented below:
$\begin{array}{lr}\text { Assets } & \begin{array}{r}\text { Increase } \\\text { (Decrease }\end{array} \\\text { Cash } & \$ 80,000 \\\text { Accounts receivable } & 200,000 \\\text { Lnventory } & 300,000 \\\text { Long-term investments } & 200,000 \\\text { Equipment } & (200,000 \\\text { Accumulated depreciation } & (60,000) \\\\\text { Liabilities and Stockholders' Equity }\\\text {Accounts payable }&\$(40,000) \\\text {Dividends payable}&400,000\\\text {Notes payable-Current }&(200,000) \\\text {Notes payable-Long-term }&400,000\\\text {Common stock, \( \$ 1.00 \) par }&300,000\\\text {Additional paid-in capital }&100,000\\\text {Retained eamings }&80,000\\\end{array}$
Additional Information for 2015:
Net income was $480,000 and dividends of $400,000 were declared.
Common stock was issued for cash.
A Long-term investment was sold for $160,000.
A new Long-term investment was acquired for $360,000.
Equipment that cost $600,000 was sold for $200,000. The book value of those assets was $150,000.
-The gain on the sale of equipment for 2015 is

• A)$50,000.
• B)$70,000.
• C)$100,000.
• D)$150,000.

---

Definitions:

Rorschach Inkblot Cards

A projective psychological test consisting of ten inkblots printed on cards, used to analyze a person's personality structure and emotional functioning by interpreting their responses to the inkblots.

Test Worthiness

Refers to the extent to which a test possesses the qualities of reliability, validity, and fairness, among other factors, making it suitable for its intended purpose.

Extensive Training

Comprehensive and in-depth instruction or preparation designed to equip individuals with knowledge, skills, or competencies in a specific area.

Cross-Cultural

Pertaining to or comparing different cultures or the cultural differences, aimed at understanding diverse perspectives and behaviors.