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1) what is the rationale for the internal control principle, segregation of duties?
a.history has shown that employees are generally dishonest and thus cannot be entrusted
with performing related duties
b.the work of one employee should, without duplication of effort, provide a reliable
basis for evaluating the work of another employee
c.control is most effective when only one person is responsible for a give task
d.segregation of duties causes companies to hire more employees and thus it supports
the economy
2) whyte clinic purchases land for $240,000 cash. the clinic assumes $3,000 in property
taxes due on the land. the title and attorney fees totaled $2,000. the clinic had the land
graded for $4,400. what amount does whyte clinic record as the cost for the land?
a.$244,400
b.$240,000
c.$249,400
d.$245,000
3) external users want answers to all of the following questions except
a.is the company earning satisfactory income?
b.will the company be able to pay its debts as they come due?
c.will the company be able to afford employee pay raises this year?
d.how does the company compare in profitability with competitors?
4) when retained earnings are restricted, total retained earnings
a.are unaffected
b.increase
c.decrease
d.may increase or decrease
5) oliver company issued $600,000 of 6%, 5-year bonds at 98. assuming straight-line
amortization and annual interest payments, how much bond interest expense is recorded
on the next interest date?
a.$36,000
b.$18,000
c.$37,200
d.$38,400
6) intangible assets are
a.listed directly under current assets on the balance sheet
b.not listed on the balance sheet because they do not have physical substance
c.listed after property, plant, and equipment
d.listed as a long-term investment on the balance sheet
7) in preparing the statement of cash flows, determining the net increase or decrease in
cash requires the use of
a.the adjusted trial balance
b.the current period's retained earnings statement
c.a comparative balance sheet
d.a comparative income statement
8) unrealized gains or losses on available-for-sale securities are reported where in the
financial statements?
a.nowhere since only realized gains are reported
b.in the other revenues and gains or other expenses and losses sections of the income
statement
c.below extraordinary items in the income statement
d.in the stockholders equity section of the balance sheet
9) oxford inc. was authorized to issue 50,000 £10 par value ordinary shares. as of
december 31, 2011, the company had issued 22,000 shares at an average price of £22
per share. during 2011, the company felt that the shares were undervalued so it
purchased 5,000 treasury shares at £18 per share. when the share price rebounded later
in the year, the company sold 2,000 of the treasury for £25. retained earnings was
£829,000 at december 31, 2011.
total equity at december 31, 2011 is
a.£1,223,000
b.£1,259,000
c.£1,273,000
d.£1,381,000
10) which one of the following items is not necessary in preparing a statement of cash
flows?
a.determine the change in cash
b.determine the cash provided by operations
c.determine cash from financing and investing activities
d.determine the cash in each of the bank accounts
11) dobler company gathered the following reconciling information in preparing its june
bank reconciliation:
the adjusted cash balance per books on june 30 is
a.$5,075
b.$4,940
c.$4,775
d.$5,055
12) dent corporation reported net sales of $400,000, $440,000, and $500,000 in the
years 2011, 2012, and 2013, respectively. if 2011 is the base year, what is the trend
percentage for 2013?
a.80%
b.114%
c.125%
d.140%
13) inventory costing methods place primary reliance on assumptions about the flow of
a.good
b.costs
c.resale prices
d.values
