Acc 400 Final Exam 20 Mcqs Essays

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ACC 400 Final Exam 20 MCQS
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Below is the course final. Please number you answer sheet from 1-20 and include the correct response by each number.

Good Luck!

1. Zelma Company's last financial statements provided the following ratios:

Current ratio 3:2

Quick ratio 1:2

Accounts receivable turnover 9.0 times

Inventory turnover 8.0 times

Net income percentage 12.5%

Return on equity 22.6%

Return on assets 9.8%

To the nearest day, what is the operating cycle for
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a. Safeguard company assets

b. Overstate liabilities in order to be conservative

c. Enhance the accuracy and reliability of accounting records

d. Reduce the risks of errors

5. A company’s past experience indicates that 60% of its credit sales are collected in the month of sale, 30% in the next month, and 5 % in the second month after the sale; the remainder is never collected. Budgeted credit sales were:

July $120,000

August 72,000

September 180,000

The cash inflow in the month of September is expected to be

a. $135,600

b. $102,600

c. $108,000

d. $129,600

6. A check for $275 is incorrectly recorded by a company as $257. On the bank reconciliation, the $18 error should be

a. Added to the balance per books.

b. Deducted from the balance per book.

c. Added to the balance per bank.

d. Deducted from the balance per bank.

7. The Allowance for Doubtful Accounts is necessary because

a. when recording uncollectible accounts expense, it is not possible to know which specific accounts will not pay.

b. uncollectible accounts that are written off must be accumulated in a separate account.

c. a liability

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