Exam 1

Front 1

All of the following transactions would have at least one of their entries recorded on the spreadsheet under the column "CURRENT LIABILITIES" in the CURRENT MONTH if accrual accounting was used EXCEPT:

Back 1

The company signed a note to borrow $100,000 from the bank that will be due in 5 years.

Front 2

Which of the following statments regarding PPE is TRUE?

Back 2

The process of depreciation is a method of allocating the cost of long-lived assets.

Front 3

Which one of the following statements is FALSE for accrual based accounting:

Back 3

All four of the financial statements we have been discussing are prepared using accrual accounting.

Front 4

What is the net impact on the Balance Sheet Equation as of the end of August if Promotions inc. does the following:
buys and pays for 15,000 in supplies
uses 10,000 of supplies

Back 4

A decrease in assets and a decrease in stockholders equity

Front 5

Which of the following formuals algebraically describes the types of cash flow statements we have been using with our transaction analysis problems?

Back 5

Beginning Cash Balance+Cash Receipts-Cash Paid=Ending Cash Balance

Front 6

on which financial statment would you expect to find an amount that would represent the amount of PREPAID RENT that has not been used up yet?

Back 6

Balance Sheet

Front 7

Which balance sheet account is used to reconcile the differences that arise because of the temporary differences in tax actually paid to the IRS and income tax expense reported in the income statement?

Back 7

Deferred Taxes

Front 8

Investing activities do NOT include:

Back 8

The company purchases inventory

Front 9

All of the following are DISADVANTAGES for the types of public corporationwe have been discussing in class EXCEPT?

Back 9

Limited Liability

Front 10

Taser International recently indicated that thei auditors included an explanatory paragraph as part of their fianl audit report for Tasers 03 and 04 fiscal years. Which of the types of audit reports mentioned in Fraser doyou think would best describe the type of audit report that Taser may have recieived?

Back 10

An unquialified opinion with explanatory languauge.

Front 11

why could depreciation expense be considered a discretionary item?

Back 11

All of the above

Front 12

Why is the method of valuing inventory important?

Back 12

The inventory valuation method chosen determines the value of the inventory on the balance sheet and the cost of goods sold expense on the income statement, two items have considerable impact on the financial position of a company

Front 13

Which of the following financial statements should be prepared second?

Back 13

Statement of Stockholders Equity.

Front 14

On January 1, 2002, a manufacturer purchased new equip costing 50,000.....

Back 14

27,000 23,000

Front 15

Why would a company who uses LIFO be considered to have higher earnings quality (as related to their financial information affected by inventory and/or COGS)

Back 15

Under LIFO, their COGS data will always reflect current replacement costs and be accurately valued.

Front 16

on which financial statement would you expect to find the account name of ACCUMLATED DEPRECIATION reported?

Back 16

Balance Sheet

Front 17

Jehn hens: the original entry to record the loan transaction on January 1 2005 should affect the following accounts:

Back 17

Cash and notes payable

Front 18

Jens hens: the entry on January 10, 2005 should affect the following accounts as indicated:

Back 18

Cash(Decrease), Inventory(No change), A/P( drecrease), COGS ( no change)

Front 19

Jens Hens: the correct entry on January 31 2005 to record the insurance adjusting entry for the month should be:

Back 19

Decrease Prepaid Insurance and Increase Insurance Expense

Front 20

which of the following statements is FALSE regarding articulation of the financial statement?

Back 20

The ending balance of the cash account on the Statement of Cash Flows shoiuld equal the ending balance of cash on the balance sheet.

Front 21

At the start of the currect period. The ultimate Pie Shop Inc. had a beginning balance in retained earnings of 100,000. The company paid dividends of 30,000 during the curect period and had an ending balace in retained earnings of 110,000. What was the net income for the current period?

Back 21

$40,000

Front 22

FASB's State of Financial Accounting Concepts no 2 discusses important qualitative characeristics of accounting info. Which is true?

Back 22

All of the above

Front 23

At the end of August, Destinations-r-us has 60,000 of cash, $45,000 of other current assets , 15,000 of long-term assests and 5,000 of accumulated depreciation. What would total assets be?

Back 23

$115,000

Front 24

All of the following are valid reasons for a company chosing to use different depreciation mehods for their financial books and their tax books EXCEPT

Back 24

Companies prefer to pay their taxes with today's dollars rather than with the dollars they earn in future years.

Front 25

In the article by Levitt that discusses earnings managment techniques, Creative Acquisition Accounting is best described by which of the following?

Back 25

A company classifies part of the purchace price when a merger occurs as :"in-process" research and development, and then writes it off the first year.

Front 26

Salaries earned for the month amount to $12,000 and all but $3,000 of the salaries have been paid. All of the entries associated with these events are being recorded at the end of the month. what will be the net impact on assets, liabilities and stockholders' equity when this transaction is recorded?

Back 26

Assets (decrease), Liabilities (increase), Stockholders'( decrease)

Front 27

Paint Depot sells on the the machines that mises its paint for $4,000. Paint Depot originally purchased the machine for $10,600. The the date of the sale, the machine had 5,000 of accumulated depreciation. What is paint depots out of pocket cost.

Back 27

$6,600

Front 28

A company recieved $75,000 in Auguest for an item that will not be deliverd until September.

Back 28

No change, No change

Front 29

DEFLATIONARY FIFO
Taxes
Current Assets

Back 29

T-Understated
CA-Accurately Valued

Front 30

INFLATIONARY LIFO

Back 30

Net I- Accurately valued
Ending inventory-- Understated