Accounting Mini Exam 1

If we have $80,000 in assets and $25,000 in liabilities, what is Stockholders' Equity?

$55,000

You purchase raw materials from a supplier on credit. You now have an ___________ with the supplier.

Accounts Payable

You perform a service for a customer and bill them for your service. You now have an __________ with the customer.

Accounts Receivable

Which of the following is part of Manufacturing Overhead? All of the following are MOH costs Indirect Materials Indirect Labor Factory rent, depreciation, insurance, etc

All of the following are MOH costs

Supplies

Assets

Accounting Equation

Assets= Liabilities + SE

Ending Work in Process Inventory

Beginning WIP + Manufacturing Costs - COGM

Notes Payable

Liability

Which one of the following is not a cost element in manufacturing a product? Direct materials Manufacturing overhead Direct labor Office salaries

Office salaries

Dividends

SE

Internal users include human resources managers.

TRUE

Buildings

Assets

What is the accounting equation?

Assets = Liabilities + Stockholders' Equity

Is the company able to pay its debts?

Creditor

Which of the following is the correct formula for finding Cost of Goods Manufactured?

Direct materials Direct labor MOH Total Manufacturing Costs Total Cost of Work In Process Less, WIP, BB

GAAP stands for:

Generally Accepted Accounting Principles

The steps in the accounting process are:

Identify, Record, Communicate

Is the company a good investment?

Investor

Income Statements

Revenues - Expenses = Net Income

Cash, Accounts Receivable, Inventory and Equipment are all examples of assets.

TRUE

Indirect Materials are raw materials that either do not become part of the finished product or are too costly to track.

TRUE

Liabilities are the creditors' claims against a business's assets.

TRUE

The accounting process includes the bookkeeping function.

TRUE

Received cash from customer in payment on account.

increase and decrease assets

Which of the following is not a manufacturing cost category? Cost of goods sold Direct labor Manufacturing overhead Direct materials

Cost of goods sold

Beginning Work in Process Inventory

Costs of Goods Sold + Ending WIP - Costs of Purchases

Managerial Accounting is primarily for external users, provides less detail, and is prepared quarterly or annually.

FALSE

Managerial accounting provides reports to help investors and creditors evaluate a company.

FALSE

The three steps in the accounting process are identification, recording, and examination.

FALSE

Cost of Goods Available for Sale is a combination of: Finished Goods, BB, and Cost of Goods Sold Cost of Goods Sold and Cost of Goods Manufactured Finished Goods, EB, and Cost of Goods Manufactured Finished Goods, BB, and Cost of Goods Manufactured

Finished Goods, BB and Cost of Goods Manufactured

Is the company complying with tax laws?

Internal Revenue Service

Which one of the following is not considered a raw material cost? Lumber used to build tables Rivets for the wings of a new commercial jet aircraft Partially completed motor engines for a motorcycle factory Bolts used in manufacturing the compressor of an engine

Partially completed motor engines for a motorcycle factory

Is the company operating within prescribed guidelines?

Regulatory Agency

Which of the following is not a Product/Manufacturing Cost? Direct Materials Direct Labor Manufacturing Overhead Selling and Administrative Costs

Selling and Administrative Costs

Retained Earnings Statement

Start with 0 + Net Income - Dividends = Retained Earnings

The two most common types of external users are investors and creditors.

TRUE

Which of the following events cannot be quantified into dollars and cents and recorded as an accounting transaction? The purchase of a new computer. The appointment of a new CPA firm to perform an audit. Payment of income taxes. The sale of store equipment.

The appointment of a new CPA firm to perform an audit

Owners enjoy limited liability in a: proprietorship. corporation. partnership. sole proprietorship.

corporation

Manufacturing costs include: direct materials, direct labor, and manufacturing overhead. direct materials and manufacturing overhead only. direct labor and manufacturing overhead only. direct materials and direct labor only.

direct materials, direct labor, and manufacturing overhead.

The accounting process is correctly sequenced: identification, recording, communication. identification, communication, recording. communication, recording, identification. recording, communication, identification.

identification, recording, communication.

Obtained a loan from the bank.

increase assets and increase liability

Billed customers for services rendered.

increase assets and increase stockholders equity

Received cash for services provided

increase assets and increase stockholders' equity.

Purchased office supplies on credit.

increase assets and liabilities

Purchased office equipment on credit

increases assets and increase liability

A manufacturing process requires small amounts of glue. The glue used in the production process is classified as a(n): direct material. miscellaneous expense. period cost. indirect material.

indirect material.

Salaries and Wages Payable

liability

Managerial accounting is also called analytical accounting. inside reporting. management accounting. controlling.

management accounting.

Amounts owed to bank

notes payable

A proprietorship is a business: organized as a separate legal entity under state corporation law. owned by one person. owned by two or more persons. owned by a governmental agency.

owned by one person

Management accountants would not: prepare reports primarily for external users. be concerned with the impact of cost and volume on profits. determine cost behavior. assist in budget planning.

prepare reports primarily for external users.

Party to whom money is owed

creditor

Paid dividends.

decrease assets and decrease stockholders' equity

Paid for office equipment purchased in transaction 2.

decreases assets and decrease liability

Paid employees' salaries.

decreases assets and decrease stockholders equity

Paid telephone bill for the month.

decreases assets and decrease stockholders equity

How the Turn Tables Inc has revenue of $100,000 and expenses of $125,000. What is their net income/loss?

$25,000 Net Loss

Wildcat Inc has the following costs: DM Used of $25, DL of $5, MOH of $20, WIP BB of $30. What is Total Manuf Cost? $80 $20 $50 $30

$50

Amounts due from customers:

accounts receivable

Managerial accounting is applicable to service entities. manufacturing entities. not-for-profit entities. all of these.

all of these.

Amounts owed to suppliers for goods and services purchased

accounts payable

Dividends directly increase Retained Earnings.

FALSE

Accountants refer to an economic event as a: purchase. transaction. change in ownership. sale.

Transaction