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ACC290 FINAL EXAM

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ACC290 FINAL EXAM

ACC290 FINAL EXAM

ACC290 FINAL EXAM: Multiple choice question

The best definition of assets is the

  • • Resources belonging to a company that have future benefit to the company.
  • • Collections of resources belonging to the company and the claims on these resources
  • • Owners’ investment in the business
  • • Cash owned by the company.

Multiple choice question

Which of the following is not a liability?

  • • Unearned service revenue
  • • Account payable
  • • Accounts receivable
  • • Interest payable

Multiple choice question

Which of the following financial statements is divided into major categories of operating, investing, and financing activities?

  • • The retained earnings statement.
  • • The statement of cash flows
  • • The balance sheet.
  • • The income statement.

Multiple choice question

  • • Ending retained earnings for a period is equal to beginning
  • • Retained earnings – net income + dividends.
  • • Retained earnings + net income + dividends
  • • Retained earnings – net income – dividends.
  • • Retained earnings + net income – dividends.

Multiple choice question

Which of the following is not an advantage of the corporate form of business organization?

  • • Easy to transfer ownership
  • • Easy to raise funds.
  • • Favorable tax treatment.
  • • No personal liability.

Multiple choice question

An advantage of the corporate form of business is that

  • • Its owner’s personal resources are at stake.
  • • It has limited life.
  • • Its ownership is easily transferable via the sale of shares of stock.
  • • It is simple to establish

ACC290 FINAL EXAM Multiple choice question

A small neighborhood barber shop that is operated by its owner would likely be organized as a

  • • Partnership.
  • • Corporation.
  • • Joint venture.
  • • Proprietorship.

Multiple choice question

If services are rendered for cash, then

  • • Liabilities will decrease.
  • • Liabilities will increase
  • • Assets will increase.
  • • Stockholders’ equity will decrease.

Multiple choice question

A revenue generally

  • • Increases assets and decreases stockholders’ equity.
  • • Increases assets and liabilities
  • • Leaves total assets unchanged
  • • Increases assets and stockholders’ equity.

Multiple choice question

A revenue account

  • • Is increased by debits.
  • • Is decreased by credits.
  • • Has a normal balance of a debit
  • • Is increased by credits.

Multiple choice question

Which accounts normally have debit balances?

  • • Assets, expense, and retained earnings
  • • Assets, liabilities, and dividends
  • • Assets, expenses, and dividends
  • • Assets, expenses, and revenues

Multiple choice question

In recording an accounting transaction in a double-entry system

  • • The number of debit accounts must equal the number of credit accounts.
  • • The amount of the debits must equal the amount of the credits.
  • • There must only be two accounts affected by any transaction.
  • • There must always be entries made on both sides of the accounting equation.

Multiple choice question

The usual sequence of steps in the transaction recording process is

  • • Journalize, analyze, post to the ledger.
  • • Analyze, journalize, post to the ledger.
  • • Journalize, post to the ledger, analyze
  • • Post to the ledger, journalize, analyze

Multiple choice question

Under the expense recognition principle expenses are recognized when

  • • They are billed by the supplier.
  • • They are paid
  • • The invoice is received.
  • • They contribute to the production of revenue

Multiple choice question

The revenue recognition principle dictates that revenue should be recognized in the accounting records:

  • • When cash is received.
  • • When the performance obligation is satisfied.
  • • At the end of the month.
  • • In the period that income taxes are paid.

Multiple choice question

Merchandising companies that sell to retailers are known as

  • • Wholesalers.
  • • Service firms.
  • • Brokers.
  • • Corporations.

Multiple choice question

Gross profit equals the difference between

  • • Sales revenue and cost of goods sold.
  • • Sales revenue and operating expenses.
  • • Sales revenue and cost of goods sold plus operating expenses.
  • • Net income and operating expenses.

Multiple choice question

Net income will result if gross profit exceeds

  • • Cost of goods sold.
  • • Purchases.
  • • Cost of goods sold plus operating expenses
  • • Operating expenses

ACC290 FINAL EXAM Multiple choice question

Under the perpetual system, cash freight costs incurred by the buyer for the transporting of goods is recorded in which account?

  • • Inventory
  • • Freight-in
  • • Freight-out
  • • Freight expense

Multiple choice question

Financial information is presented below:

Operating expenses $ 44000
Sales revenue 229000
Cost of goods sold 159000

The profit margin ratio would be

  • • 0.69.
  • • 0.31.
  • • 0.11.
  • • 0.89

ACC290 FINAL EXAM Multiple choice question

Financial information is presented below:

Operating expenses $ 20000
Sales returns and allowances 9000
Sales discounts 4000
Sales revenue 190000
Cost of goods sold 91000

The gross profit rate would be

  • • 0.54
  • • 0.53.
  • • 0.49.
  • • 0.45.

Multiple choice question

Financial information is presented below:

Operating expenses $ 57000
Sales returns and allowances 3000
Sales discounts 6000
Sales revenue 142000
Cost of goods sold 110000

Gross profit would be

  • • $23000.
  • • $35000.
  • • $29000.
  • • $32000.

Multiple choice question

The lifo inventory method assumes that the cost of the latest units purchased are

  • • Not allocated to cost of goods sold or ending inventory.
  • • The first to be allocated to ending inventory.
  • • The last to be allocated to cost of goods sold.
  • • The first to be allocated to cost of goods sold

Multiple choice question

Which of the following statements is correct with respect to inventories?

  • • The fifo method assumes that the costs of the earliest goods acquired are the last to be sold.
  • • Under fifo, the ending inventory is based on the latest units purchased
  • • Fifo seldom coincides with the actual physical flow of inventory
  • • It is generally good business management to sell the most recently acquired goods first.

Multiple choice question

All of the following are examples of internal control procedures except

  • • Using prenumbered documents.
  • • Reconciling the bank statement.
  • • Insistence that employees take vacations.
  • • Customer satisfaction surveys.

ACC290 FINAL EXAM Multiple choice question

Each of the following is a feature of internal control except

  • • Separation of duties.
  • • Recording of all transactions
  • • An extensive marketing plan
  • • Bonding of employees

Multiple choice question

For which of the following errors should the appropriate amount be subtracted from the balance per books on a bank reconciliation?

  • • Deposit of $500 recorded by the bank as $50.
  • • A returned $200 check recorded by the bank as $20.
  • • Check written for $59, but recorded by the company as $95.
  • • Check written for $53, but recorded by the company as $35.

ACC290 FINAL EXAM Multiple choice question

A check written by the company for $117 is incorrectly recorded by a company as $171. On the bank reconciliation, the $54 error should be

  • • Added to the balance per books.
  • • Deducted from the balance per bank.
  • • Deducted from the balance per books.
  • • Added to the balance per bank.

Multiple choice question

The following information was available for kingbird, inc. At december 31, 2017: beginning inventory $70000; ending inventory $108000; cost of goods sold $644000; and sales $888000. Kingbird inventory turnover ratio (rounded) in 2017 was

  • • 6.0 times.
  • • 10.0 times.
  • • 9.2 times
  • • 7.2 times.

Multiple choice question

The following information was available for marigold corp. At december 31, 2017: beginning inventory $87000; ending inventory $122000; cost of goods sold $632000; and sales $872000. Marigold days in inventory (rounded) in 2017 was (round intermediate calculation to 1 decimal place, e.g. 1.2.)

  • • 44.0 days.
  • • 70.2 days.
  • • 50.0 days.
  • • 60.8 days.

Note: This assignment contains the word document and the excel sheet. The assignment is based in a company and they are both related with accurate numbers.  

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