ACCT

Adam Company has 100 units costing $300 in beginning inventory. During the year, the company purchases 900 units for a total cost of $2,880. At the end of the year, a physical count reveals that 200 units remain in ending inventory. If the company uses the FIFO method, cost of goods sold will be

$2,540

Adam Company has 100 units costing $300 in beginning inventory. During the year, the company purchases 900 units for a total cost of $2,880. At the end of the year, a physical count reveals that 200 units remain in ending inventory. If the company uses the FIFO method, the cost of ending inventory will be what? Note: this question is asking for the ending inventory value, not cost of goods sold.

$640

The key provisions of the Sarbanes-Oxley Act include

-restricting activities of auditors to prevent conflicts of interest. -requiring that corporate executives certify financial statements. -requiring documentation and assessing effectiveness of internal controls.

What would cause a bank statement not to agree with the cash balance in the accounting records?

Deposits outstanding that have been recorded on the company's records, but not on the bank's. The bank paid interest that the company has not recorded. The company made an error in recording a deposit. The bank made an error in recording a deposit made by the company.

The definition of inventory includes which of the following items?

Items currently in production for future sale Items held for resale Items used currently in the production of goods to be sold

When adjusting the bank balance in a bank reconciliation, which item must be subtracted from the bank balance?

Outstanding checks

Under the Sarbanes-Oxley Act, who is responsible for the selection of a corporation's auditor?

The audit committee of the Board of Directors

Which of the following is an example of separation of duties in a good system of internal control?

The individual who receives the inventory does not have access to the accounting records.

In a bank reconciliation, a deposit outstanding is

added to the bank balance.

steps for a bank reconciliation

adjust banks cash bal adjust companies cash bal update companies cash acct

Norma Inc. uses the perpetual inventory system. When the company records a sale, it should make entries to:

decrease an asset and increase an expense increase an asset and increase revenue

FIFO

the... inventory cost flow assumption typically approximates the actual physical flow of inventory items of most companies.

What requirements for corporate accountability are included in the Sarbanes-Oxley Act? (Select all that apply.)

-Corporate executives must personally certify the financial statements -Corporate executives may be criminally liable for fraudulent financial statements

Adrian Corp. sells goods on account for $100,000 on May 1. On May 15, the customer returns $40,000 of the merchandise. The customer has not yet paid for any of the goods. What will Adrian record on May 15? (Select all that apply.)

Credit to Accounts Receivable. Debit to Sales Returns.

Clark uses the perpetual inventory system. Clark sells goods to a customer on account for $1,000. The cost of the goods sold was $700. Which of the following entries are required?

Debit Cost of Goods Sold $700; credit Inventory $700 Debit Accounts Receivable $1,000; credit Sales Revenue $1,000

Which of the following entries affect a company's cash flows?

Debit supplies; credit cash Debit rent expense; credit cash

Which of the following are provisions included in the Sarbanes-Oxley Act?

Require that audit firms are hired by the audit committee of the board of directors. Require auditors to retain work papers for 7 years.