Archives: Quiz

1) In a partnership liquidation, the final cash distribution to the partners should be made in accordance with the: a.partners’ profit and loss sharing ratio b.balances of the partners’ capital accounts c.ratio of the capital contributions by the partners d.ratio […]

1) Describe the guidelines to be used in determining (a) what constitutes an operating segment, and (b) whether a specific operating segment is a significant segment. 2) Polly, Inc. owns 80% of Saffron, Inc. During 2014, Polly sold goods with […]

1) There have been several recent cases of a CEO or CFO resigning or being ousted for misrepresenting academic credentials. For instance, during February 2006,the CEO of RadioShack resigned by mutual agreement for inflating his educational background. During 2002, Veritas […]

1) On November 30, 2013, Piani Incorporated purchased for cash of $25 per share all 400,000 shares of the outstanding common stock of Surge Company. Surge ‘s balance sheet at November 30, 2013, showed a book value of $8,000,000. Additionally, […]

The following balance sheet information is for the partnership of Abel, Boule, and Cayman:1) Cash$ 210,000Liabilities$ 510,000 Other assets1,500,000 Abele, Capital (40%)300,000 Boule, Capital (40%)480,000 Cayman, Capital (20%) 420,000 $1,710,000$1,710,000 Figures shown parenthetically reflect agreed profit and loss sharing percentages. […]

1) Customers’ meter deposits which cannot be spent for normal operating purposes would be classified as restricted cash in the balance sheet of which fund? a.Internal Service b.Trust c.Agency d.Enterprise 2) Puma Company owns 80% of the common stock of […]

1) From a consolidated entity point of view, the constructive gain or loss on the open market purchase of a parent company’s bonds by a subsidiary company is a.considered realized at the date of the open market purchase b.realized in […]

1) If a subsidiary has both common and preferred stock outstanding, a parent must own a controlling interest in a.both the subsidiary’s common and preferred stock to justify consolidation b.the subsidiary’s common stock to justify consolidation c.the subsidiary’s common stock […]

1) In accounting for and reporting inventory in the financial statements, the “Reserve for Inventory” account is used under a.the consumption method b.the purchase method c.both the consumption and purchase methods d.none of these 2) A parent company uses the […]

1) Which of the following statements related to pledges is incorrect? a.Pledges are signed commitments to contribute specific amounts of money on a future date or in installments b.Pledges are recorded as revenues when a promise to give is nonrevocable […]

1) In accounting for expendable fund entities, revenue is ordinarily not recognized until: a.it can be objectively measured and it is available to finance expenditures of the current period b.a transaction has taken place and the earnings process is complete […]

1) P Company acquires all of the voting stock of S Company for $930,000 cash. The book values of S Companys assets are $800,000, but the fair values are $840,000 because land has a fair value above its book value. […]

1) On May 1, 2013, the Phil Company paid $1,200,000 for 80% of the outstanding common stock of Sage Corporation in a transaction properly accounted for as an acquisition. The recorded assets and liabilities of Sage Corporation on May 1, […]

1) If the functional currency is determined to be the U.S. dollar and its financial statements are prepared in the local currency, SFAS 52, requires which of the following procedures to be followed? a.Translate the financial statements into U.S. dollars […]

1) On January 1, 2013, Prosser Company acquired 90% of the common stock of Simone Company for $720,000 and 20% of the preferred stock for $70,000.On this date,Simone Company reported the following account balances: Common stock ($10 par value)$600,000 Preferred […]

1) There are several advantages to using activity-based costing. Which of the following is one of these advantages? A.Services not performed in a department are allocated a portion of the cost of operating that department B.Each department can choose the […]

1) Bobbys Burger Place monitors its variances on an hourly basis. It is not uncommon for Bobby to send workers home early when which of the following variances indicates that he has over-scheduled the shift? A.Unfavorable labor efficiency variance B.Favorable […]

1) Stan is the manager of a division that has been struggling lately. It is budget time and Stan feels he is under the gun to do well next year. As such, he is building slack into his budget. How […]

1) In a four-variance method analyzing factory overhead, the fixed factory overhead production-volume variance measures: A.The difference between the actual fixed factory overhead and budgeted fixed factory overhead B.The difference between actual fixed factory overhead and the amount of fixed […]

1) Factors to be considered in setting labor standards include all of the following except: A.Impact of negotiations with labor unions B.The learning effect C.Results of engineers time studies D.The purchasing managers estimate of suppliers prices 2) Listed below are […]

1) The records of Andrews Company reflect the following data: Work in process, beginning of the month – 4,500 units; 1 / 3 completed at a cost of $2,400 for materials, $825 for labor, and $3,000 for overhead. Production costs […]

1) Payroll is debited and Wages Payable is credited to: A.Pay the payroll taxes B.Record the payroll C.Pay the payroll D.Distribute the payroll 2) A summary of Jacob Companys flexible budget of manufacturing costs follows: What would the flexible budget […]

1) Thomas Company uses a standard cost system and recognizes the materials purchase price variance at the time materials are purchased. Information for raw materials for Product RBI for the month of October follows: What is the materials quantity variance? […]

1) The following data are from Baker Company, a manufacturer, for the month of October: Compute the conversion costs. A.$167,500 B.$104,500 C.$140,500 D.$128,000 2) The Lucas Manufacturing Company has two production departments (fabrication and assembly) and three service departments (general […]

1) All of the following are features of a standard cost system except: A.Standards change as conditions change B.Variances may be determined more often than monthly to allow for more timely action C.Standards are based on estimates D.The company determines […]

1) Bellisimo Industries material handling costs and tons of material over a six-month period follow: Using the high-low method, what is the estimated material handling cost per ton of material? A.$.90 B.$1.25 C.$1.00 D.$.80 2) The Joan Company uses the […]

1) Which of the following is not a duty of the cost accountant in a process cost system? A.Estimating the stage of completion of in-process units at the end of the month B.Collecting the periodic production costs C.Preparing the journal […]

1) The accounting system used with JIT manufacturing is called: A.Backflush costing B.The push system C.Perpetual inventory costing D.First-in, first-out 2) If there is no beginning work in process inventory and the ending work in process inventory is 90 percent […]

1) All of the following are examples of factory overhead costs that benefit the entire factory would therefore be difficult to identify with a specific department except: A.machine depreciation B.factory security C.the plant managers salary D.heating costs 2) Hebert & […]

1) Which of the following is not a key element of the Sarbanes Oxley Act to improve corporate governance? A.The establishment of the Public Company Accounting Oversight Board B.Requiring a companys annual report to contain an internal control report that […]

1) The Columbus Company has three departments A, B and C. Material requisitions amounted to $10,000, $8,000 and $5,000, respectively, for departments A, B and C. In addition, $2,000 of indirect materials were used during the period. What is the […]

1) Under a modified wage plan, Jim Phillips works an eight-hour day and earns $.50 for each finished unit he produces in excess of 200 units. However, he is guaranteed $12.50 per hour as a minimum wage. His production this […]

1) The following information pertains to the Braun Company for March: Using the four-variance method of factory overhead variance analysis, what is the fixed overhead production-volume variance? A.$1,200 favorable B.$1,800 unfavorable C.$3,000 favorable D.$1,200 unfavorable 2) If a company using […]

1) The controller has asked you to examine different distribution methods for applying factory overhead to the various production orders that are processed during a year. The following information was taken from the annual budget: Actual results for the year […]

1) Lawrence and Louis Law Firm uses activity-based costing to determine the costs of its cases. Information about costs follow: The Laurel case required 60 professional hours, 20 of which were partner hours, and labor costs totaled $10,000. If direct […]

1) Table 7-6 Provincewide Milling Company uses a sales journal. On June 2, the sales journal appears as you see below. Sales Journal Other sales that took place in June are as follows: Refer to Table 7-6, at the end […]

1) Total assets at the end of the period were $330,000 and liabilities were 25% of owner’s equity. Determine owner’s equity at the end of the period. A) $264,000 B) $132,000 C) $462,000 D) $825,000 2) Details of purchase invoices […]

1) The current credit balance in allowance for doubtful accounts before adjustment is $658. An aging schedule reveals $3,500 of uncollectible accounts. The journal entry for estimated uncollectible accounts should be prepared for: A) $658 B) $3,500 C) $4,158 D) […]

1) Table 5-4 The following data is for the Atlantis Merchandising, which uses a periodic inventory system: Refer to Table 5-4. The operating income for Atlantis Merchandising is: A) $(11,000) B) $63,000 C) $51,000 D) $60,000 2) If a company […]

1) In a system of good internal control, a payment to a supplier requires which documents for proper approval? A) a journal entry, a supplier invoice, and a description of the goods being purchased B) a receiving report, an invoice, […]

1) Match the following. A) debit B) normal balance C) credit 1> The left-hand side of an account 2> The right-hand side of an account 3> The side of the account where increases are recorded 2) Table 4-2 The ledger […]

1) Table 7-1 On April 1, Pro Company received a cheque from Carter Company for payment of an invoice dated March 24 for $3,000 with credit terms of 2/10 n/30. On March 28, Carter had returned $200 of the merchandise […]

1) The most liquid asset is: A) notes receivable B) cash C) accounts receivable D) prepaid expenses 2) Match the following. A) goodwill B) intangible assets C) tangible assets 1> Excess of the cost of an acquired company over the […]

1) Match the following. A) gross margin percentage B) inventory turnover 1> Gross margin divided by net sales revenue 2> Ratio of cost of goods sold to average inventory 2) Indicate how the following columns are posted from the sales […]

1) A contingent gain that is likely and can be reasonably estimated should be: A) disclosed in a note to the financial statements B) accrued with a journal entry C) either disclosed in a note or accrued with a journal […]

1) Accounts receivable has a debit balance of $5,000, and the allowance for doubtful accounts has a credit balance of $440. A specific account of $160 is written off. What is the amount of net receivables after the write-off? A) […]

1) The following accounts appear in the adjusted trial balance columns of a worksheet. State the column that each account balance is extended to, choosing from the following columns: 1> income statement debit 2> balance sheet debit 3> income statement […]

1) The entries to record a $5,000 cash sale under a periodic inventory system, when the cost of the merchandise is $3,200, include a: A) debit to Inventory for $5,000 B) credit to Sales Revenue for $5,000 C) debit to […]

1) Table 10-2 On January 1, 2013, Homes Realty Ltd. purchased a $45,000 vehicle to chauffeur clients to prospective homes. Homes plans on driving the vehicle for five years or 100,000 kilometres. Expected residual value is $10,000. Refer to Table […]

1) A petty cash fund was established with a $400 balance. It currently has cash of $10 and petty cash tickets as shown below. The journal entry to replenish the account would be which of the following: A) Debit various […]