The journal entry a company records for the issuance of bonds when the contract rate
and the market rate are the same is
A.debit Bonds Payable, credit Cash
B.debit Cash and Discount on Bonds Payable, credit Bonds Payable
C.debit Cash, credit Premium on Bonds Payable and Bonds Payable
D.debit Cash, credit Bonds Payable
Answer:
The sales, income from operations, and invested assets for each division of Grosbeak
Company are as follows:
Answer:
A check drawn by a company in payment of a voucher for $965 was recorded in the
journal as $695. What entry is required in the company’s accounts?
A.debit Accounts Payable; credit Cash
B.debit Cash; credit Accounts Receivable
C.debit Cash; credit Accounts Payable
D.debit Accounts Receivable; credit Cash
Answer:
Calculate the gross profit for Jonas Company based on the data given below:
A.$753,250
B.$700,750
C.$162,750
D.$215,250
Answer:
Department G had 3,600 units, 25% completed at the beginning of the period, 11,000
units were completed during the period, 3,000 units were one-fifth completed at the end
of the period, and the following manufacturing costs were debited to the departmental
work in process account during the period:
Assuming that all direct materials are placed in process at the beginning of production
and that the first-in, first-out method of inventory costing is used, what is the total cost
of the units ‘started and completed” during the period (round unit cost calculations to
four decimal places)?
A.$211,200
B.$120,060
C.$190,275
D.$20,934
Answer:
The journal entry a company uses to record the payment of an interest-bearing note is
A.debit Cash; credit Notes Payable
B.debit Accounts Payable; credit Cash
C.debit Notes Payable and Interest Expense; credit Cash
D.debit Notes Payable and Interest Receivable; credit Cash
Answer:
The work sheet at the end of July has $5,950 in the Balance Sheet credit column for
Accumulated Depreciation. The work sheet at the end of August has $7,600 in the
Balance Sheet credit column for Accumulated Depreciation. What was the amount of
the depreciation expense adjustment for the month of August?
A.amount can not be determined
B.$7,600
C.$5,950
D.$1,650
Answer:
Cost flow is in the order in which costs were incurred when using
A.average cost
B.last-in, first-out
C.first-in, first-out
D.weighted average
Answer:
Which of the following would be subtracted from the balance per books on a bank
reconciliation?
A.Outstanding checks
B.Deposits in transit
C.Notes collected by the bank
D.Service charges
Answer:
The entry to record the amortization of a premium on bonds payable on an interest
payment date includes:
A.debit Premium on Bonds Payable, credit Interest Revenue
B.debit Interest Expense, credit Premium on Bond Payable
C.debit Interest Expense, debit Premium on Bonds Payable, credit Cash
D.debit Bonds Payable, credit Interest Expense
Answer:
Production and sales estimates for June are as follows:
The budgeted total sales for June is:
A.$200,000
B.$400,000
C.$380,000
D.$250,000
Answer:
Which of the following would not be considered a good managerial tool in making a
decision for determining a capital investment?
A.Further evaluate assets that are dissimilar in nature or have different useful lives.
B.Using only quantitative measures to purchase an asset.
C.Analyzing the lease vs purchase option.
D.Considering income tax ramifications.
Answer:
A business paid $7,000 to a creditor in payment of an amount owed. The effect of the
transaction on the accounting equation was to
A.increase one asset, decrease another asset
B.decrease an asset, decrease a liability
C.increase an asset, increase a liability
D.increase an asset, increase owner’s equity
Answer:
All leases are classified as either
A.capital leases or long-term leases
B.capital leases or operating leases
C.operating leases or current leases
D.long-term leases or current leases
Answer:
Which of the following groups are considered to be internal usersof accounting
information?
A.Employees and customers
B.Customers and vendors
C.Employees and managers
D.Government and banks
Answer:
The standard price and quantity of direct materials are separated because:
A.GAAP reporting requires this separation
B.direct materials prices are controlled by the purchasing department, and quantity used
is controlled by the production department
C.standard quantities are more difficult to estimate than standard prices
D.standard prices change more frequently than standard quantities
Answer:
Given the following data:
Dec. 31,2014Dec. 31,2013
Total liabilities $128,250 $120,000
Total owner’s equity 95,000 80,000
a. Compute the ratio of liabilities to owner’s equity for each year.
b. Has the creditors’ risk increased or decreased from December 31, 2013, to December
31, 2014?
Answer:
An advantage of the partnership form of business organization is
A.unlimited liability
B.mutual agency
C.ease of formation
D.limited life
Answer:
Which one of the accounts below would likely be included in an accrual adjusting
entry?
A.Insurance Expense
B.Prepaid Rent
C.Interest Expense
D.Unearned Rent
Answer:
Cost of Materials Used $45,000
Direct Labor costs $48,000
Factory Overhead $39,000
Work in Process, beg. $28,000
Work in Process, end. $18,000
Finished Goods,beg. $28,000
Finished Goods, end. $18,000
What is Cost of Goods Sold?
A.$152,000
B.$142,000
C.$10,000
D.$128,000
Answer:
If the owner wanted to know how money flowed into and out of the company, what
financial statement would she use?
A.Income Statement
B.Statement of Cash Flows
C.Balance Sheet
D.None are correct.
Answer:
In which journal would you find cash revenues recorded?
A.cash payments journal
B.general journal
C.revenues journal
D.cash receipts journal
Answer:
Zeke Company is a manufacturing company that has worked on several production jobs
during the 1st quarter of the year. Below is a list of all the jobs for the quarter:
Job 356, 357, 358 & 359 were completed. Jobs 356 & 357 were sold at a profit of $500
on each job.
What is the ending balance of Cost of Goods sold for Zeke Company as of the end of
the 1st quarter?
A.$456
B.$2,685
C.$1,685
D.$685
Answer:
Pacific Division for Bean Company has a rate of return on investment of 28% and an
investment turnover of 1.4. What is the profit margin?
A.28%
B.20%
C.14%
D.39.2%
Answer:
Period costs are
A.found on the balance sheet.
B.not involved in the production process.
C.classified as direct labor, direct material, or factory overhead.
D.found on the job order cost sheets.
Answer:
Production estimates for August are as follows:
For each unit produced, the direct materials requirements are as follows:
The number of pounds of materials A and B required for August production is:
A.216,000 lbs. of A; 72,000 lbs. of B
B.216,000 lbs. of A; 36,000 lbs. of B
C.225,000 lbs. of A; 37,500 lbs. of B
D.234,000 lbs. of A; 39,000 lbs. of B
Answer:
A list of the accounts is called
A.ledger
B.chart of accounts
C.T-Account
D.Debit
Answer:
The term deficit is used to refer to a debit balance in which of the following accounts of
a corporation?
A.Retained Earnings
B.Treasury Stock
C.Organizational Expenses
D.Common Stock
Answer:
Which of the following is true about a T-Account?
A.Left hand side of the T-Account is called a debit.
B.Left hand side of the T-Accounts is called a credit
C.Right hand side of the T-Account is called a debit
D.None are true.
Answer:
Processing methods:
A.are the policy and procedures that protect assets from misuse.
B.must be computerized.
C.are the means by which the accounting system reports information.
D.ensure that business laws and regulations are followed.
Answer:
The investment turnover is the:
A.ratio of income from operations to sales
B.ratio of income from operations to invested assets
C.ratio of assets to liabilities
D.ratio of sales to invested assets
Answer:
Quick assets include
A.cash; cash equivalents, receivables, prepaid expenses, and inventory
B.cash; cash equivalents, receivables, and prepaid expenses
C.cash; cash equivalents, receivables, and inventory
D.cash; cash equivalents, and receivables
Answer:
Dotterel Corporation uses the variable cost concept of product pricing. Below is cost
information for the production and sale of 35,000 units of its sole product. Dotterel
desires a profit equal to a 11.2% rate of return on invested assets of $350,000.
The variable cost per unit for the production and sale of the company’s product is:
A.$14.00
B.$12.60
C.$9.80
D.$11.20
Answer:
If title to merchandise purchases passes to the buyer when the goods are shipped from
the seller, the terms are
A.n/30
B.FOB shipping point
C.FOB destination
D.consigned
Answer: