On the First Day of the Fiscal Year, Hawthorne Company

question 53

Multiple Choice

On the first day of the fiscal year, Hawthorne Company obtained a $ 88,000, seven-year, 5% installment note from Sea Side Bank. The note requires annual payments of $15,208, with the first payment occurring on the last day of the fiscal year. The first payment consists of interest of $4,400 and principal repayment of $10,808. The journal entry Hawthorne would record to make the first annual payment due on the note would include:

• A) a debit to Cash of $15,208
• B) a credit to Notes Payable for $10,808
• C) a debit to Interest Expense for $4,400
• D) a debit to Notes Payable for $15,208

Understand the principles of total quality management and its focus on continuous improvement.

Distinguish between the focuses of financial and managerial accounting in terms of organizational level.

Recognize the significance of control in the managerial process and its relationship to goal setting.

Identify the goals of lean business models, including waste elimination and customer satisfaction.

---

Definitions:

Inability

The state of being unable to perform a task or action due to physical or psychological limitations.

Urination

The process of excreting urine from the bladder through the urethra to the outside of the body.

Metabolism

The complex set of life-sustaining chemical reactions in organisms that enable the conversion of food to energy, elimination of nitrogenous wastes, and synthesis of necessary compounds.

Waste Products

Substances produced through metabolic and other processes in organisms that are no longer needed and are excreted or removed.