Accounting 2301 Final
A. proprietorship
B. Corporation
C. partnership
D. Governmental unit
A. Social accounting
B. Tax accounting
C. Environmental accounting
D. All are correct
A. General Accounting Procedures
B. Generally accepted Plans
C. Generally Accepted Accounting Principles
D. Generally accepted accounting practices
A. $50,000
B. $65,000
C. $10,000
D. $45,000
A. Assets = equities – liabilities
B. Assets + Liabilities = Owner’s equity
C. Assets = Revenues Less Liabilities
D. Assets – Liabilities = Owner’s Equity
A. increase one asset, decrease another asset
B. increase an asset, increase a liability
c. decrease an asset, decrease a liability
D. increase an asset, increase owner’s equity
A. increase expenses
B. decrease expenses
C. increase cash
D. decrease owner’s equity
A. assets increase; owner’s equity decreases
B. Assets increase; liabilities increase
C. Assets increase; liabilities decrease
D. Liabilities increase; owner’s equity decreases
A. Owner’s withdrawals and expenses
B. Revenues and expenses
C. Owner’s investments and revenues
D. Owner’s Investments and expenses
A. Increase Assets (accounts receivable) and decrease Assets (cash)
B. Decrease Assets (cash) and decrease Owner’s Equity (Owner’s Withdrawal)
C. Decrease Assets (cash) and decrease liabilities (account payable)
D. Increase Assets (cash) and decrease Owner’s Equity (Owner’s Withdrawal)
A. Alphabetical order
B. Order of Largest to smallest dollar amounts
C. In the order what will be converted into cash
D. no order
A. assets
B. liabilities
C. Revenues
D. Net income
A. Assets and liabilities
B. liabilities and expenses
C. Revenues and liabilities
D. Capital and drawing
A. asset, credit
B. Liability, credit
C. Owner’s equity, debit
D. Revenue, credit
A. assets
B. revenues
C. expenses
D. drawing
a. debit Joe, capital; credit Cash
B. debit Joe, Drawing; credit Cash
C. debit Salaries Expense; credit Cash
D. debit Salaries Expense; credit Salaries Payable
A. Office Supplies, debit; Cash, credit
B. Cash, debit; Office Supplies, credit
C. Office Supplies, debit; Account Payable, credit
D. Accounts Receivable, debit; Office Supplies, credit
A. Debit “Dr”, Credit “Cd”
B. Debit “Db”, Credit “Cr”
C. Debit “Db”, Credit “Cd”
D. Debit “Dr”, Credit “Cr”
A. Neither a debit or a credit
B. credit
C. debit
D. either a debit or a credit
A. Cash, Accounts Payable, Buildings
B. Accounts Receivable, Revenue, Cash
C. Prepaid Expenses, Buildings, Patents
D. Unearned Revenues, Prepaid Expenses, Cash
A. recording
B. Journalizing
C. posting
D. summarizing
A. Cash 10,000 (D)
Brown, Capital 10,000 (C)
Invested cash in business
B. Cash 10,000 (C)
Brown, Capital 10,000(C)
Invested cash in business
C. Brown, capital 10,000 (D)
cash 10,000 (C)
Invested cash in business
D. Brown , capital 10,000 (C)
Cash 10,000 (C)
Invested cash in business
A. a transaction can only affect one period of time
B. estimates should not be made if a transaction affects more than one time period.
C. adjustments to the enterprise’s accounts can only be made in the time period when the business terminates its operations
D. the economic life of a business can be divided into artificial time periods
A. the IRS
B. A loterry
C. the Business
D. The SEC
A. customers with businesses
B. expenses with revenues
C. assets with liabilities
D creditors with businesses
A. cash must be received before revenue is recognized
B. net income is calculated by matching cash outflows against cash inflows
C. events that change a company’s financial statements are recognized in the period they occur rather than in the period in which cash is paid or received
D. The ledger accounts must be adjusted to reflect a cash basis of accounting before financial statements are prepared under generally accepted accounting principles
A. because some costs expire with the passage of time and have not yet been journalized.
B. when the company’s profits are below the budget
C. When expenses are recorded in the period in which they are incurred
D. When revenues are recorded in the period in which they are earned
A. affects two balance sheet accounts
B. affects two income statement accounts
C. affects a balance sheet account and an income statement account
D. is always a compound entry
A. received and recorded as liabilities before they are earned
B. earned and recorded as liabilities before they are received
C. earned but not yet received or recorded
D. earned and already received and recorded
A. paid and recorded in an asset account before they are used or consumed
B. paid and recorded in an asset account after they are used or consumed
C. incurred but not yet paid or recorded
D. incurred and already paid or recorded
A. received and recorded as liabilities before they are earned
B. earned and recorded as liabilities before they are received
C. earned but not yet received or recorded
D. earned and already received and recorded
A. original cost of an asset – accumulated depreciation
B. depreciable cost / depreciation rate
C. cost of the asset / useful life
D. market value of the asset / useful life
A. an expense liability account relationship exists
B. prior to adjustment, expenses are overstated and assets are understated
C. the adjusting entry results in a debit to an expense account and a credit to an asset account
D. none of these
A. only manual systems of accounting
B. the extent of government regulations
C. safeguarding assets
D. preparing income tax returns
A. all balance sheet accounts
B. assets
C. liabilities
D. capital stock
A. have access to the accounting records for the asset
B. be someone outside the company
C. not have access to the accounting records for that asset
D. be an accountant
A. a fraud committee
B. collusion
C. a division of duties
D. bonding of employees
A. it means that they are not allowed to handle cash
B. they have worked for the company for at least 10 years
C. They have been insured against misappropriation of assets
D. it is impossible for them to steal from the company
A. cash
B. petty cash
C. cash equivalents
D. a prepaid expense
A. should be safeguarded
B. should be pre-signed
C. do not need to be safeguarded since they must be signed to be valid
D. should not be prenumbered
A. pay for all merchandise purchased on account
B. pay employees’ wages
C. make loans internally to employees
D. pay relatively small expenditures
A. have been recorded on the company’s books but not yet by the bank
B. have been recorded by the bank but not yet by the company
C. have not been recorded by the bank or the company
D. are checks from customers which have not yet been received by the company
A. whenever the bank refuses to lend the company money
B. when an employee is suspected of fraud
C. to explain any difference between the depositor’s balance per books and the balance per bank
D. by the person who is authorized to sign checks
A. lets a depositor know the financial position of the bank as of a certain date
B. is a credit reference letter written by the depositor’s bank
C. is a bill from the bank for services rendered
D. shows the activity which increased or decreased the depositor’s account balance
A. investment income
B. service fees
C. the sale of merchandise
D. the sale of fixed assets the company owns
A. gross profit
B. net profit
C. net income
D. marginal income
A. asset account
B. contra asset account
C. expense account
D. contra revenue account
A. the customer must pay the bill within 10 days
B. the customer can deduct a 2% discount if the bill is paid between the 10th and the 30th day from the invoice date
C. the customer can deduct a 2% discount if the bill is paid within 10 days of the invoice date
D. two sales returns can be made within 10 days of the invoice date and no returns thereafter
A. sales
B. sales allowances
C. Sales discounts
D. sales returns
A. both a multiple-step and a single-step income statement
B. neither a multiple-step nor a single-step income statement
C. a single-step income statement
D. a multiple-step income statement
A. beginning inventory to net purchases
B. beginning inventory to the cost of goods purchased
C. net purchases and freight-in
D. purchases to beginning inventory
A. accounts receivable
B. notes receivable
C. doubtful accounts
D. bad debts
A. an avoidable cost in doing business on a credit basis
B. an internal control weakness
C. a necessary risk of doing business on a credit basis
D. avoidable unless there is a recession
A. uses an allowance account
B. uses a contra-asset account
C. does not require estimates of bad debt losses
D. is the preferred method under generally accepted accounting principles
A. indicates that the business is in financial difficulty
B. is generally the major revenue item on its income statement
C. is an indication that the business is owned by a factor
D. can be a quick way to generate cash for operating needs
A. reported under the classification of Property, Plant, and Equipment on the balance sheet
B. often reported as a miscellaneous expense on the income statement
C. reported as a current asset on the balance sheet
D. generally valued at the price for which the goods can be sold
Jan 14 375 @ $28 (sales)
Jan 17 250 @ $20 (Purchases)
Jan 25 250 @ $22 (Purchases)
Jan 29 250 @ $32 (sales)
Kershaw does not maintain perpetual inventory records. According to a physical count, 375 units wer on hand at January 31.
The cost of the inventory at January 31, under the FIFO method is:
A. $1000
B. $6750
C. $7750
D. $8000
A. beginning inventory and ending inventory
B. beginning inventory and cost of goods on hand
C. ending inventory and cost of goods sold
D. beginning inventory and cost of goods purchased
An end of the month (1/31/10) inventory showed that 120 units were on hand. How many units did the company sell during January, 2010?
A. 80
B. 120
C. 200
D. 280
A. FIFO method
B. LIFO method
C. average-cost method
D. tax method
A. conservatism
B. accuracy
C. comparability
D. efficiency
A. current replacement cost
B. selling price
C. historical cost plus 10%
D selling prices less markup
Cost of goods sold – Net Income
A. Understated – Understated
B. Overstated – Overstated
C. Understated – Overstated
D. Overstated – Understated
A. public carrier accepts the goods from the seller
B. goods reach the buyer
C. terms of sale are FOB destination
D. terms of sale are FOB shipping point
A. land
B. buildings on the land
C. land or land improvements, whichever is longer
D. Land improvements
A. Cash fund to be used to replace plant assets.
B. amount to be deducted from the cost of the plant asset to arrive at its fair market value
C. amount charged to expense in the current period
D. amount charged to expense since the acquisition of the plant asset
A. an equal and equitable manner
B. an accelerated and accurate manner
C. a systematic and rational manner
D. a conservative market-based manner
A. the fair market value of a plant asset on the date of acquisition
B. subtracted from accumulated depreciation to determine the plant asset’s depreciable cost
C. an estimate of a plant asset’s value at the end of its useful life
D. ignored in all the depreciation methods
A. straight-line
B. declining-balance
C. units-f-activity
D. None of these
A. $86,400
B. $88,000
C. $96,000
D. $99,000
A. depreciated using the units-of-activity method
B. Physically extracted in operations and are replaceable only by an act of nature
C. reported at their market value
D. amortized over a period no longer than 40 years
A a decrease in market value of natural resources
B. The amount of spoilage that occurs when natural resources are extracted
C. allocation of the cost of natural resources to expense
D. The method used to record unsuccessful patents
A. useful in determining income
B. useful in evaluating a company’s liquidity
C. Called the matching principle
D. useful in determining the amount of a company’s long-term debt
A. within one year
B. between 6 months and 18 months
C. out of currently recognized revenues
D. out of cash currently on had
A. Interest Expense (D)
Cash (D)
Notes Payable (C)
B. Cash (D)
Notes Payable (C)
C. Notes Payable (D)
Cash (C)
D. Cash (D)
Notes Payable (D)
Interest payable (C)
Notes Payable (C)
A. crediting sales taxes revenue
B. debiting sales taxes expense
C. crediting sales taxes Payable
D. debiting sales Taxes payable
A. Debit to sales tax expense for $12
B. Credit to sales tax payable for $12
C. debit to sales for $132
D. debit to cash for $120
A. revenue
B. expense
C. current asset
D. current liability
A. potential liability
B. hypothetical liability
C. probabilistic liability
D. contingent liability
A. federal unemployment taxes
B. FICA taxes
C. state unemployment taxes
D. Federal and state unemployment taxes
A. corporation is organized for the purpose of making a profit
B. corporation is subject to more federal and satte government regulations
C. corporation is an accounting economic entity
D. corporation’s temporary accounts are closed at the end of the accounting period
A. is unique to the corporation form of business
B. is an optional account in the partnership form of business
C. reflects cash paid in by stockholders to date
D. is closed at the end of the year
A. is credited when no-par stock does not have a stated value
B. is reported as part of paid-in capital on the balance sheet
C. represents the amount of legal capital
D. Normally has a debit balance
A. investment
B. liability
C. deduction from total paid-in capital
D. deduction from total paid-in capital and retained earnings
A. earnings
B. property
C. cash
D. stock
A. Long-term liability
B. contra stockholders’ equity account to retained earnings
C. current liability
D. stockholder’s equity account
A. expect the market price per share to increase
B. own more shares of stock
C. expect retained earnings to increase
D. expect the par value of the stock to change
A. decrease total assets and total stockholders’ equity
B. increase stockholder’s equity and decrease total liabilities
C. decrease total retained earnings and increase total liabilities
D. reduce the amount of retained earnings available for dividend declarations
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