ACCT Final Exam Review

On October 31, 2016, Siri Studios, Inc. had a balance per their records of $15,015. In reconciling their October 31, 2016 bank statement, Siri found outstanding checks of $4,500, a deposit in transit of $8,300, NSF checks of $1,400, and bank service charges of $88. Additionally, the October 23rd deposit of $8,100 was incorrectly recorded as $1,800 in the records of Siri. The adjusted cash balance should be? (Do Not enter dollar signs.)

$19827

On March 1st, Coyote Corp. accepted a 5-year, 8% note of $150,000. Coyote makes annual adjustments. What amount of interest will Coyote accrue at December 31st?

12000

Kathy Corp. had a Merchandise Inventory account with a balance on January 1, 2016 of $715,000 and the cost of goods purchased was $230,000. The cost of goods sold for 2016 was $520,000. What is the December 31, 2016 ending inventory?

425000

On September 1, Tucker Inc. received $30,000 from a customer who would like Tucker to provide services evenly over the next five months. Using the revenue recognition principle, how much would Tucker record as revenue for the year from this job? A. $24,000 B. $0 C. $30,000 D. $6,000 E. $18,000

A. $24,000

Which of the following relate to cash flow from financing: 1. Decrease in salaries payable. 5. Purchase equipment. 2. Increase in accounts payable. 6. Decrease in taxes payable. 3. Sell investments in land. 7. Pay cash dividends. 4. Issue bonds for cash. 8. Issue common stock for cash. A. 4, 7, and 8. B. 4, 5, 7, and 8. C. 3, 4, 7, and 8. D. 3, 4, and 7. E. 3, 4, and 8.

A. 4, 7, and 8.

Kenda Corporation sold land with a cost of $50,000 for $80,000 cash. Which of the following is the correct presentation of this information on the Cash Flow Statement? A. Deduct the gain of $30,000 from net income in the operating activities section and show a cash inflow of $80,000 from the sale of land in the investing section. B. Show a cash inflow of $80,000 from the sale of land in the financing section. C. Deduct the $50,000 cost of land from net income in the operating activities section, and show a cash inflow of $80,000 from the sale of land in the investing section. D. Add the gain of $30,000 to net income in the operating activities section and show a cash inflow of $30,000 from the sale of land in the investing section. E. Show a cash inflow of $30,000 from the sale of land in the investing section.

A. Deduct the gain of $30,000 from net income in the operating activities section and show a cash inflow of $80,000 from the sale of land in the investing section.

Which of the following accounts would not have a balance on the Post Closing Trial Balance? A. Dividends B. Retained Earnings C. Accumulated depreciation D. Unearned revenues E. Prepaid expenses

A. Dividends

How is "Accounts Payable" classified and on what statement does it appear? A. Liability on the Balance Sheet B. Owner's Equity on Balance Sheet C. Revenue on Income Statement D. Asset on the Balance Sheet E. Asset on Income Statement

A. Liability on the Balance Sheet

An accrued asset could also be called A. an accrued revenue. B. a prepaid expense. C. a deferred expense. D. an accrued expense. E. an accrued contra asset.

A. an accrued revenue.

Neffie Corporation acquired land by signing a long-term note for $150,000. Which of the following is the correct presentation of this transaction on the Statement of Cash Flows? A. A cash inflow of $150,000 in financing activities and a $150,000 cash outflow in investing activities. B. A cash inflow of $150,000 in investing activities and a $150,000 cash outflow in financing activities. C. This transaction would not affect the Statement of cash flows. D. A cash inflow from financing activities only. E. A cash inflow from investing activities only.

C. This transaction would not affect the Statement of cash flows.

On March 15, 2017, House Stark, Inc. issued 10,000 shares of $10 par common stock in exchange for a fleet of used rental automobiles from the Lannister Co. Lannister's original purchase price of the automobiles was $240,000, but on the date of acquisition an independent appraisal estimated the fair value at $180,000. There is no readily available market value for the common stock. House Stark's March 15, 2017 journal entry to record the acquisition of the used automobiles is as follows: A. Vehicles 180,000 Common stock 180,000 B. Vehicles 240,000 Common stock 100,000 Additional paid-in capital 140,000 C. Vehicles 180,000 Common stock 100,000 Additional paid-in capital 80,000 D. Vehicles 100,000 Common stock 100,000 E. Cash 180,000 Common stock 100,000 Additional paid-in capital 80,000

C. Vehicles 180,000 Common stock 100,000 Additional paid-in capital 80,000

Which of the following groups of accounts all increase with credits? A. Depreciation expense, Unearned Revenue, Equipment B. Dividends, Accumulated depreciation, Common stock C. Revenues, Dividends, Retained earnings D. Accounts Payable, Accumulated depreciation, Service revenue E. Retained earnings, Notes receivable, Prepaid rent

D. Accounts Payable, Accumulated depreciation, Service revenue

Which of the following would be DEDUCTED from the net income in the operating activities section of a Statement of cash flows when using the indirect method? A. Loss on retirement of bonds B. Decrease in accounts receivable C. Depreciation expense D. Gain on sale of equipment E. Increase in Accounts payable

D. Gain on sale of equipment

The capacity for financial information to make a difference in a decision is referred to as: A. Ethical representation B. Complete and error-free information C. Faithful representation D. Relevant information E. Consistent application

D. Relevant information

On February 28th, the Alexander Co. recorded $180,000 commissions earned by the sales staff during the month. The staff will be paid the following month. The entry on February 28th would be: Use the following abbreviations for accounts to fill in the blanks: CA = Cash AR = Accounts Receivable CN = Commissions Earned CP = Commissions Payable CE = Commissions Expense

Debit: CE Credit: CP

Big Daddy Auto Parts, Inc. has an office supplies account that had a January 1st balance of $13,450. During the year, Big Daddy Auto purchased $24,360 in office supplies. On December 31st, a count of the office supplies revealed that there were $7,500 remaining. On December 31st, Big Daddy's adjusting entry for office supplies should be: Use the following abbreviations for accounts to fill in the blanks: AR = Accounts Receivable AP = Accounts Payable OS = Office Supplies Inventory OE = Office Supplies Expense

Debit: OE Credit: OS for $30310

On February 12, Badger Corp. purchased office supplies paying $4,000. Badger's journal entry to record this event on February 12 is: Use the following abbreviations for accounts to fill in the blanks: CA = Cash AR = Accounts Receivable AP = Accounts Payable OS = Office Supplies OE = Office Supplies Expense

Debit: OS Credit: CA

Which if the following statements is TRUE about preferred stock? A. If dividends are declared, the preferred stockholders receive their dividends after the common stockholders. B. Preferred stockholders must receive dividends. C. Only preferred stockholders vote for the board of directors. D. Preferred stocks are normally sold before common stock. E. If dividends are declared, the preferred stockholders receive dividends before the common stockholders.

E. If dividends are declared, the preferred stockholders receive dividends before the common stockholders.

A type of capital stock that cannot receive dividends, even if declared, and cannot vote for the board of directors is: A. Cumulative B. Common C. Convertible D. Preferred E. Treasury

E. Treasury

A company sold some equipment for cash. The impact of the activity on cash flows is Use the following abbreviations: II for inflow from investing activity OI for outflow from investing activity IF for inflow from financing activity OF for outflow from financing activity

II for inflow from investing activity

If assets increased by $50,000 and Liabilities decreased by $10,000, how did owner's equity change? For the direction of the change use the following abbreviations to fill in the blank: increase (I) or decrease (D), or not change (NC)

Owners' Equity would Increase (I) by $60000

Black and Red Corp. has the following accounts and balances as of December 31, 2017. Accounts payable 23,000 Inventory 50,000 Accounts receivable 25,000 Interest payable 10,000 Accum. Depreciation 17,000 Marketable securities 30,000 Capital stock 90,000 Notes Payable due Mar. 4, 2022 60,000 Cash 32,000 Patents 25,000 Customer deposits 19,000 Prepaid insurance 6,000 Equipment 80,000 Retained earnings 29,000

The total non-current assets amount is $88000

A company uses the allowance method to recognize bad debts from its customers. The entry required to recognize the bad debt will have what effect on the following elements of the financial statements? Use these abbreviations: Use I for Increase Use D for Decrease Use NC for Not change

Total Assets will D Net Income will D

Gap, Inc. received a request from a customer to reduce the invoice price of goods because the goods were damaged in shipment. This type of request is recorded as a credit to Accounts Receivable and a debit to: a. Sales Revenues b. Sales Discounts c. Retained Earnings d. Sales Returns and Allowances e. Cash

d. Sales Returns and Allowances

Which of the following statements is FALSE? a. Because the allowance method results in better matching, accounting standards require its use rather than the direct write-off method, unless bad debts are immaterial. b. Bad Debts expense is debited and Allowance for doubtful accounts is credited at the end of the period to recognize bad debts under the allowance method. c. An aging schedule typically categorizes the various accounts by the length of time each invoice is outstanding. d. The reason the allowance method of recognizing bad debts is used is primarily because it recognizes higher amount of Accounts receivable on the balance sheet than the direct method. e. Allowance for doubtful accounts is a contra account that is used to reduce accounts receivable to its net realizable value.

d. The reason the allowance method of recognizing bad debts is used is primarily because it recognizes higher amount of Accounts receivable on the balance sheet than the direct method.