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John Pickens Writes Mystery Novels

Question 76

Multiple Choice

John Pickens writes mystery novels.His publisher pays him royalties for books sold each year.He is paid royalties for the first half of the year on September 30 and the second half of the year on March 31 of the following year.He received $42,000 in September,2016.The publisher estimated that his royalties for the second half of the year would be $53,000.On March 31,2017,he received $57,500.Assuming that he recorded $53,000 at December 31,2016,which one of the following is the correct journal entry on March 31,2017? His tax rate is 35%.


A) John Pickens writes mystery novels.His publisher pays him royalties for books sold each year.He is paid royalties for the first half of the year on September 30 and the second half of the year on March 31 of the following year.He received $42,000 in September,2016.The publisher estimated that his royalties for the second half of the year would be $53,000.On March 31,2017,he received $57,500.Assuming that he recorded $53,000 at December 31,2016,which one of the following is the correct journal entry on March 31,2017? His tax rate is 35%. A) Royalty Revenue 4,500 B) Royalty Revenue 57,500 C) Retained Earnings 4,500 D) Retained Earnings 2,925 Income Taxes Payable 1,575 Royalty Revenue 4,500
B) John Pickens writes mystery novels.His publisher pays him royalties for books sold each year.He is paid royalties for the first half of the year on September 30 and the second half of the year on March 31 of the following year.He received $42,000 in September,2016.The publisher estimated that his royalties for the second half of the year would be $53,000.On March 31,2017,he received $57,500.Assuming that he recorded $53,000 at December 31,2016,which one of the following is the correct journal entry on March 31,2017? His tax rate is 35%. A) Royalty Revenue 4,500 B) Royalty Revenue 57,500 C) Retained Earnings 4,500 D) Retained Earnings 2,925 Income Taxes Payable 1,575 Royalty Revenue 57,500
C) John Pickens writes mystery novels.His publisher pays him royalties for books sold each year.He is paid royalties for the first half of the year on September 30 and the second half of the year on March 31 of the following year.He received $42,000 in September,2016.The publisher estimated that his royalties for the second half of the year would be $53,000.On March 31,2017,he received $57,500.Assuming that he recorded $53,000 at December 31,2016,which one of the following is the correct journal entry on March 31,2017? His tax rate is 35%. A) Royalty Revenue 4,500 B) Royalty Revenue 57,500 C) Retained Earnings 4,500 D) Retained Earnings 2,925 Income Taxes Payable 1,575 Retained Earnings 4,500
D) John Pickens writes mystery novels.His publisher pays him royalties for books sold each year.He is paid royalties for the first half of the year on September 30 and the second half of the year on March 31 of the following year.He received $42,000 in September,2016.The publisher estimated that his royalties for the second half of the year would be $53,000.On March 31,2017,he received $57,500.Assuming that he recorded $53,000 at December 31,2016,which one of the following is the correct journal entry on March 31,2017? His tax rate is 35%. A) Royalty Revenue 4,500 B) Royalty Revenue 57,500 C) Retained Earnings 4,500 D) Retained Earnings 2,925 Income Taxes Payable 1,575 Retained Earnings 2,925
Income Taxes Payable 1,575

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