Clifford Moore is starting his computer programming business and has deposited in
initial investment of $15,000 into the business cash account. Identify how the
accounting equation will be affected.
A.Increase Assets (Cash) and increase Liabilities (Accounts Payable)
B.Increase Assets (Cash) and increase Owner’s Equity (Clifford Moore, Capital)
C.Increase Assets (Accounts Receivable) and decrease Liabilities (Accounts Payable)
D.Increase Assets (Cash) and increase Assets (Accounts Receivable)
Answer:
Which of the following group of accounts increase with a credit?
A.Capital, revenues, expenses
B.Assets, capital, revenues
C.Liabilities, capital, revenues
D.None of these
Answer:
Assuming a 360-day year, when a $30,000, 90-day, 5% interest-bearing note payable
matures, total payment will amount to:
A.$31,500
B.$1,500
C.$30,375
D.$375
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 Gross
Profit for the month of May using the LIFO cost method
A.$348
B.$452
C.$444
D.$356
Answer:
Which of the following represents an inflow of cash and therefore would be reported on
the statement of cash flows?
A.retirement of bond payable
B.acquisition of treasury stock
C.declaration of stock dividends
D.issuance of long-term debt
Answer:
All of the following accounts are increased with a debit except:
A.Unearned Revenues
B.Land
C.Accounts Receivable
D.Cash
Answer:
Multiple-step income statements show
A.gross profit but not income from operations
B.neither gross profit nor income from operations
C.both gross profit and income from operations
D.income from operations but not gross profit
Answer:
Beginning inventory, purchases, and sales for Product – Weld TM are as follows:
Assuming a perpetual inventory system and the first-in, first-out method, determine (a)
the cost of the merchandise sold for the September 30 sale and (b) the inventory on
September 30.
Answer:
The controller’s staff often consists of several management accountants. All of the
following would most likely be on the controller’s staff EXCEPT:
A.general accountants
B.budgets and budget analysts
C.investments and shareholder relations managers
D.cost accountants
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:
Depreciation on factory equipment would be reported in the statement of cash flows
prepared by the indirect method in
A.the cash flows from financing activities section
B.the cash flows from investing activities section
C.a separate schedule
D.the cash flows from operating activities section
Answer:
The proper sequence of steps in the accounting cycle is as follows
A.analyze and record transactions, post transaction to the ledger, prepare a trial balance,
prepare financial statements, journalize closing entries, analyze adjustment data and
prepare adjusting entries
B.prepare a trial balance, analyze adjustment data, prepare adjusting entries, prepare
financial statements, journalize closing entries and post to the ledger, analyze and
record transactions, post transactions to the ledger
C.analyze and record transactions, post transactions to the ledger, prepare a trial
balance, analyze adjustment data, prepare adjusting entries, prepare financial
statements, journalize closing entries and post to the ledger, and finally prepare a
post-closing trial balance
D.prepare financial statements, journalize closing entries and post to the ledger, analyze
and record transactions, post transactions to the ledger, prepare a trial balance, analyze
adjustment data, prepare adjusting entries
Answer:
An anticipated purchase of equipment for $600,000, with a useful life of 8 years and no
residual value, is expected to yield the following annual net incomes and net cash
flows:
What is the cash payback period?
A.5 years
B.4 years
C.6 years
D.3 years
Answer:
Waller Company does business in two regional segments: North and South. The
following annual revenue information was determined from the accounting system’s
invoice information:
Using horizontal analysis, determine the percentage change in revenues for the South
region.
Round to one decimal place.
A.30.0%
B.77.6%
C.(30.0%)
D.(77.6%)
Answer:
Which one of the following below reflects a weak internal control system?
A.all employees are well supervised
B.a single employee is responsible for comparing a receiving report to an invoice
C.all employees must take their vacations
D.a single employee is responsible for collecting and recording of cash
Answer:
Mason Corporation had $650,000 in invested assets, sales of $700,000, income from
operations amounting to $99,000, and a desired minimum rate of return of 15%.
The residual income for Mason is:
A.$0
B.$84,150
C.($6,000)
D.$1,500
Answer:
A business pays bi-weekly salaries of $20,000 every other Friday for a ten-day period
ending on that day. The last pay day of December is Friday, December 27. Assuming
the next pay period begins on Monday, December 30 and the proper adjusting entry is
journalized at the end of the fiscal period (December 31). The entry for the payment of
the payroll on Friday, January 10 includes a:
A.debit to Salary Expense of $16,000
B.debit to Salary Expense of $4,000
C.credit to Salary Payable of $16,000
D.credit to Salary Payable of $4,000
Answer: