Bonds Payable has a balance of $1,000,000 and Discount on Bonds Payable has a
balance of $10,000. If the issuing corporation redeems the bonds at 97.5, what is the
amount of gain or loss on redemption?
A.$10,000 loss
B.$25,000 loss
C.$25,000 gain
D.$15,000 gain
Answer:
All of the following are reasons to use an estimated method of costing inventory except:
A.Perpetual inventory records are not maintained.
B.Purchase records are not maintained.
C.A disaster has destroyed the inventory records and the inventory.
D.Interim financial statements are required but physical inventory is only taken at the
end of the financial accounting period.
Answer:
Below is budgeted production and sales information for Flushing Company for the
month of December:
The unit selling price for product XXX is $5 and for product ZZZ is $15.
Budgeted production for product ZZZ during the month is:
A.403,000 units
B.380,000 units
C.397,000 units
D.417,000 units
Answer:
Use the following information to answer the following questions.
The Boxwood Company sells blankets for $60 each. The following was taken from the
inventory records during May. The company had no beginning inventory on May 1.
Assuming that the company uses the perpetual inventory system, determine the ending
inventory value for the month of May using the FIFO inventory cost method.
A.$364
B.$372
C.$324
D.$320
Answer:
The price at which a stock can be sold depends upon a number of factors. Which
statement below is not one of those factors?
A.the financial condition, earnings record, and dividend record of the corporation
B.investor expectations of the corporation’s earning power
C.how high the par value is
D.general business and economic conditions and prospects
Answer:
Cost of goods manufactured during 2011 is $240, work in process inventory on
December 31, 2011, is $50. Work in process inventory during 2011 decreased by 60%.
Total manufacturing costs incurred during 2011 amount to:
A.$190
B.$165
C.$290
D.$315
Answer:
How will the following adjusting journal entry affect the accounting equation?
A.Increase assets, increase revenues
B.Increase liabilities, increase revenues
C.Decrease liabilities, increase revenues
D.Decrease liabilities, decrease revenues
Answer:
Which of the following concepts relates to separating the reporting of business and
personal economic transactions?
A.Cost Concept
B.Unit of Measure Concept
C.Business Entity Concept
D.Objectivity Concept
Answer:
A manufacturing company applies factory overhead based on direct labor hours. At the
beginning of the year, it estimated that factory overhead costs would be $360,000 and
direct labor hours would be 30,000. Actual manufacturing overhead costs incurred were
$377,200, and actual direct labor hours were 36,000. The entry to apply the factory
overhead costs for the year would include a
A.debit to factory overhead for $360,000.
B.credit to factory overhead for $432,000.
C.debit to factory overhead for $377,200.
D.credit to factory overhead for $360,000.
Answer:
The Merchant Company issued 10-year bonds on January 1, 2011. The 15% bonds have
a face value of $100,000 and pay interest every January 1 and July 1. The bonds were
sold for $117,205 based on the market interest rate of 12%. Merchant uses the
effective-interest method to amortize bond discounts and premiums. On July 1, 2011,
Merchant should record interest expense (round to the nearest dollar) of
A.$7,032
B.$7,500
C.$8,790
D.$14,065
Answer:
A factor in determining the rate of return on investment–the ratio of income from
operations to sales–is called:
A.profit margin
B.indirect expenses
C.investment turnover
D.cost
Answer:
Owner’s withdrawals
A.increase expenses
B.decrease expenses
C.increase cash
D.decrease owner’s equity
Answer:
Below is a table for the present value of $1 at Compound interest.
Below is a table for the present value of an annuity of $1 at compound interest.
Using the tables above, what is the present value of $4,000 (rounded to the nearest
dollar) to be received at the end of each of the next four years, assuming an earnings
rate of 12%?
A.$2,544
B.$1,000
C.$12,148
D.$14,420
Answer:
On January 1, 2010, Cary Parsons established a catering service. Listed below are
accounts to use for transactions (a) through (f), each identified by a number. Following
this list are the transactions that occurred in Parsons’ first month of operation. You are to
indicate for each transaction the accounts that should be debited and credited by placing
the account number(s) in the appropriate box.
Transactions Account(s) Debited Account(s) Credited
a. Recorded jobs completed on account and sent invoices to customers.
b. Received an invoice for truck expenses to be paid in February.
c. Paid utilities expense
d. Received cash from customers on account.
e. Paid employee wages.
Answer:
]cpmembership level=”2,3,4,5[“
Transactions Account(s) Debited Account(s) Credited
a. 2 11
b. 15 8
c. 14 1
d. 1 2
e. 12 1
f. 10 1
/]cpmembership[
The Flapjack Corporation had 8,200 actual direct labor hours at an actual rate of $12.40
per hour. Original production had been budgeted for 1,100 units, but only 1,000 units
were actually produced. Labor standards were 7.6 hours per completed unit at a
standard rate of $13.00 per hour.
Compute the labor time variance.
A.9,880F
B.9,880U
C.7,800U
D.7,800F
Answer:
]cpmembership level=”2,3,4,5[“
C.
/]cpmembership[
To record estimated uncollectible receivables using the allowance method, the adjusting
entry would be a
A.debit to Bad Debs Expense and a credit to Allowance for Doubtful Accounts.
B.debit to Accounts Receivable and a credit to Allowance for Doubtful Accounts.
C.debit to Allowance for Doubtful Accounts and a credit to Accounts Receivable.
D.debit to Loss on Credit Sales and a credit to Accounts Receivable .
Answer:
]cpmembership level=”2,3,4,5[“
A.
/]cpmembership[
Indicate whether each of the following would be reported in the section of financial
statements identified as (a) current asset, (b) property, plant, and equipment, (c) current
liability, (d) revenue, or (e) expense:
Answer:
]cpmembership level=”2,3,4,5[“
/]cpmembership[
Which of the following is considered to be unearned revenue?
A.Concert tickets sold last month for yesterday’s performance.
B.Concert tickets sold yesterday on credit for yesterday’s performance.
C.Concert tickets that were not sold for the current performance.
D.Concert tickets sold for next month’s performance .
Answer:
]cpmembership level=”2,3,4,5[“
D.
/]cpmembership[
If $2,000,000 of 10% bonds are issued at 95, the amount of cash received from the sale
is
A.$2,200,000
B.$2,000,000
C.$2,100,000
D.$1,900,000
Answer:
]cpmembership level=”2,3,4,5[“
D.
/]cpmembership[
Use the following information to answer the following questions.
Assuming no employees are subject to ceilings for their earnings, Jensen Company has
the following information for the pay period of January 15 – 31, 20xx.
Assuming that all wages are subject to federal and state unemployment taxes, the
Payroll Taxes Expense would be recorded as:
A.$1,370
B.$750
C.$620
D.$2,870
Answer:
]cpmembership level=”2,3,4,5[“
A.
/]cpmembership[
Which of the following can be used to place capital investment proposals involving
different amounts of investment on a comparable basis for purposes of net present value
analysis?
A.Price-level index
B.Future value index
C.Rate of investment index
D.Present value index
Answer:
]cpmembership level=”2,3,4,5[“
D.
/]cpmembership[
The Cavy Company estimates that the factory overhead for the following year will be
$1,250,000. The company has decided that the basis for applying factory overhead
should be machine hours, which is estimated to be 40,000 hours. The machine hours for
the month of April for all of the jobs was 4,780. If the actual factory overhead totaled
$141,800, determine the over or under applied amount for the month.
A.$7,575 underapplied
B.$35,220 underapplied
C.$7,575 overapplied
D.$35,220 overapplied
Answer:
]cpmembership level=”2,3,4,5[“
C.
/]cpmembership[
A company will most likely use an estimated method of determining inventory when
A.the company decides not to do a physical inventory.
B.a natural disaster has destroyed most of their inventory.
C.the company has not kept up with their inventory records.
D.the company is preparing annual financial statements .
Answer:
]cpmembership level=”2,3,4,5[“
B.
/]cpmembership[
A change in the ownership of a partnership results in the
A.consolidating of the partnership
B.liquidating of the partnership
C.realization of the partnership
D.dissolution of the partnership
Answer:
]cpmembership level=”2,3,4,5[“
D.
/]cpmembership[
Xavier and Yolonda have original investments of $50,000 and $100,000 respectively in
a partnership. The articles of partnership include the following provisions regarding the
division of net income: interest on original investment at 10%, salary allowances of
$27,000 and $18,000 respectively, and the remainder equally. How much of the net loss
of $6,000 is allocated to Xavier?
A.$4,000
B.$1,000
C.$3,000
D.$6,000
Answer:
]cpmembership level=”2,3,4,5[“
B.
/]cpmembership[
Several transactions are listed below, with the accounting equation stated to the right
side of each. Use the following identification codes to indicate the effects of each
transaction on the accounting equation. Write your answers in the space provided under
the accounting equation. You need an identification code for each element of the
accounting equation. An example is given before the first transaction.
Assets = Liabilities + Owner’s Equity
Example John Smith invests in his new business by giving it his personal drill press
valued at $3,500.
I__
___ NE__
___ I____
A(
Cash sales are made.
B) Equipment is purchased on credit.
C) Payment is made for the equipment purchased on credit in (B.(
_____
D) The company sold excess supplies to another company on credit.
________
_______
________
E) Cash is collected from customers for accounts receivable balances.
________
_______
________
Answer:
]cpmembership level=”2,3,4,5[“
Assets = Liabilities + Owner’s Equity
A(
Cash sales are made.
I
NE
I
B) Equipment is purchased on credit.
I
I
NE
C) Payment is made for the equipment purchased on credit in (B.(
D
D
NE___
D) The company sold excess supplies to another company on credit.
___NE___
___NE__
___NE___
E) Cash is collected from customers for accounts receivable balances.
___NE___
___NE__
___NE___
/]cpmembership[
Due to various fraudulent business practices and accounting coverups in the early
2000’s, Congress enacted the Sarbanes-Oxley Act of 2002. The Act was responsible for
establishing a new oversight board for public accountants called the
A.Generally Accepted Accounting Practices for Public Accountants Board.
B.Public Company Accounting Oversight Board.
C.Congressional Accounting Oversight Board.
D.None are correct .
Answer:
]cpmembership level=”2,3,4,5[“
B.
/]cpmembership[
Which of the following accounts should be closed to Income Summary at the end of the
fiscal year?
A.Merchandise Inventory
B.Accumulated Depreciation
C.Drawing
D.Cost of Merchandise Sold
Answer:
]cpmembership level=”2,3,4,5[“
D.
/]cpmembership[
The following lots of a particular commodity were available for sale during the year:
The firm uses the periodic system and there are 20 units of the commodity on hand at
the end of the year.
What is the amount of cost of goods sold for the year according to the LIFO method?
A.$1,380
B.$1,375
C.$1,510
D.$1,250
Answer:
]cpmembership level=”2,3,4,5[“
C.
/]cpmembership[
All nine transactions for Dalton Survey Company for September, the first month of
operations, are recorded in the following T accounts:
Indicate the following for each debit and each credit:
Present your answers in the following form:
Answer:
]cpmembership level=”2,3,4,5[“
/]cpmembership[
The Swan Company produces their product at a total cost of $43 per unit. Of this
amount $8 per unit is selling and administrative costs. The total variable cost is $30 per
unit The desired profit is $20 per unit.
Determine the mark up percentage on total cost.
A.100%
B.110%
C.80%
D.46.5%
Answer:
]cpmembership level=”2,3,4,5[“
D.
/]cpmembership[
The Western Division of Bestboot Company has a rate of return on investment of 15%
and an investment turnover of 1.2. What is the profit margin?
A.10%
B.12.5%
C.9%
D.6%
Answer:
]cpmembership level=”2,3,4,5[“
B.
/]cpmembership[