Each partner has a separate Capital, Withdrawals, and Income or Loss account.
In a process cost report, accounting for physical units excludes the physical units in
beginning inventory to arrive at ‘units to be accounted for.’
It is the issuer rather than the bond holder who may exercise the call feature of a
callable bond.
The double-entry system is possible because all business transactions have at least two
equal and opposite aspects.
Treasury stock usually is recorded at cost when purchased.
A revenue for which the service has been performed but that has not been recorded is a
deferred revenue.
All expenses incurred by a business are paid immediately in cash.
Which of the following statements isFALSE regarding promissory notes?
A.They are sometimes used to extend past-due accounts.
B.They can be resold to banks.
C.They must be held by the maker until maturity.
D.They are often received upon the sale of machinery and automobiles.
When the estimates involved in earnings management begin moving outside a
reasonable range, the financial statements can become misleading.
All of the following statements about corporations areTRUE except
A.they are chartered by the state.
B.ownership is represented by shares of stock.
C.the sale of stock does not dissolve the business.
D.the stockholders have direct control of the business.
The petty cash fund of Writer Company was established on May 1 and appeared as
follows on May 31:
(a) Prepare the journal entry on May 1 to establish the fund (omit explanation).
(b) Prepare the journal entry on May 31 to replenish the fund (omit explanation).
Which of the following documents would be prepared (by a buyer of goods) after the
others?
A.Purchase order
B.Check
C.Purchase requisition
D.Receiving report
Which of the following is an example of a financing activity?
A.Paying taxes to the government
B.Selling equipment
C.Obtaining a bank loan
D.Purchasing land
A change from FIFO to LIFO in a period of rising prices will
A.decrease both the current ratio and the inventory turnover ratio.
B.increase both the current ratio and the inventory turnover ratio.
C.increase the current ratio and decrease the inventory turnover ratio.
D.decrease the current ratio and increase the inventory turnover ratio.
Free cash flow is
A.a financial ratio.
B.an important measure of a company’s ability to finance long-term assets.
C.what remains after deducting dividends declared from net income.
D.an important measure of a company’s ability to invest in short-term assets.
Sinoyianis Realty Company had the following balance sheet accounts and balances:
If the equipment were sold for $14,000, what would be the total of owner’s equity?
A.$8,000
B.$22,000
C.$36,000
D.$40,000
Equivalent production is also called
A.conversion costs.
B.completed work cell units.
C.equivalent units.
D.equivalent transfer.
Which of the following would be added to the balance per bank?
A.Outstanding checks
B.Bank service charges
C.Collection of a note receivable by the bank
D.Deposits in transit
Use this information to answer the following question.
The total dollar amount of assets to be classified as property, plant, and equipment is
A.$374,000.
B.$262,000.
C.$354,000.
D.$122,000.
Which of the following cannot be learned by analyzing job order cost cards?
A.The balance of Work in Process Inventory at the end of the period
B.The cost of all jobs done for a particular customer
C.The completion time of jobs yet to be completed
D.The type of products ordered by a particular customer
On a statement of cash flows prepared using the indirect method, the amount
representing cash paid for interest would
A.be included in the net cash flows from financing activities section.
B.not be shown.
C.be included in the net cash flows from investing activities section.
D.be included in the net cash flows from operating activities section.
.Product unit costs computed using activity-based costing compared to product unit
costs computed using a traditional costing approach will
A.sometimes be the same.
B.always be higher.
C.always be the same.
D.always be lower.
Share and Care International is trying to determine how many clients must be serviced
in order to cover its monthly service overhead. Using the high-low method, it has
determined that the variable cost per client is $800 and that the monthly fixed overhead
is $28,000.
Assuming an average fee of $1,400 per client and a targeted profit of $26,000, the
number of clients to be serviced is
A.80 clients.
B.120 clients.
C.47 clients.
D.90 clients.
The periodicity assumption recognizes that
A.the company may continue indefinitely.
B.all financial statements should cover a fiscal year.
C.net income is an estimate.
D.the value of an asset may vary from month to month.
Costs such as salary of supervisors and other support personnel, which are accounted
for as overhead costs, are called
A.period labor costs.
B.sales assistance costs.
C.indirect labor costs.
D.prime labor costs.
Unearned Revenue was $1,200 at the end of May and $1,500 at the end of June. Service
Revenue was $8,550 for the month of June. How much cash was received for services
provided during June?
A.$8,250
B.$5,850
C.$8,850
D.$11,250
What is a capital lease, in substance? How is a capital lease recorded? At what amount
is a capital lease recorded?
Tomlin Enterprises has a credit balance of $80,000 in its Allowance to Adjust
Long-Term Investments to Market account before adjustment. Its investment portfolio
has a total cost of $500,000 and a market value of $450,000. The year-end adjustment
entry that would be recorded in the books of Tomlin Enterprises is:
Use the following adjusted trial balance to answer the question below.
The entry to close the Jet Ski Rentals account is
The following lettered items represent a classification scheme for a multistep income
statement. In the blank next to each account, write the letter indicating to which
category it belongs.
Use the following data for Window Rock Company to prepare a statement of cash flows
using the indirect method for the year ended June 30, 20×6.
Additional information:
A company purchases land, a building on the land, and equipment in the building all for
$200,000 cash. The appraised values are $135,000, $67,500, and $22,500 for the land,
building, and equipment, respectively. In the journal provided, record the entry for the
purchase. (Omit explanation.)
Lassen Corporation issued ten-year term bonds on January 1, 20×5, with a face value of
$800,000. The face interest rate is 8 percent and interest is payable semi-annually on
June 30 and December 31. The bonds were issued for $690,960 to yield an effective
annual rate of 10 percent. The effective interest method of amortization is to be used.
The entry on June 30, 20×5, to record the payment of interest and amortization of
discount is:
Brendan Company sold merchandise worth $1,600 on credit, terms n/15. The
merchandise sold had cost $1,100. What is the required journal entry to record the
transaction under the perpetual inventory system?
When leases meet 3 conditions, accounting standards require that they be treated as a
capital lease. What are the 3 conditions?
Garcia Company’s owner’s equity equals one-half of the company’s total assets. The
company’s liabilities are $140,000. What is the amount of the company’s owner’s
equity?