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29) Over the past two decades, research has shown half of financial statement fraud has involved improper revenue recognition.  What are the more common revenue recognition schemes? 30) Outline the criteria required for revenue recognition. 31) What is other comprehensive income and what typically does it include? 32) The statement of earnings for.
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21) In the majority of cases, an organization cancels the shares they repurchase. 22) Obus Corporation has issued 75,000 common shares. The average issuance price was $23 per share. Obus Corporation recently engaged in the following share repurchase transactions: a.Purchased 15,000 shares of its own shares at $25.00 per share. b.Sold 2,500 shares.
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9.7  Report equity transactions on the statement of cash flows 1) Proceeds from the issuance of shares appear in which, if any, section of the cash flow statement? A) operating activities section B) investing activities section C) financing activities section D) Proceeds from the issuance of shares do not appear in the cash flow statement. 2).
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10.3  Understand consolidated financial statements 1) Goodwill arises when a parent company: A) pays less to acquire a subsidiary company than the market value of the subsidiary's net assets B) pays more to acquire a subsidiary company than the market value of the subsidiary's net assets C) pays less to acquire a subsidiary company.
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21) Short term investments are recorded at market value and reported on the balance sheet at cost. 22) Why is understanding the extent to which ATCO Ltd. influences another company important for accounting purposes?  What impact does the degree of influence ATCO Ltd. has over another company have on accounting? 23).
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11) Short term investments in bonds are quite rare. 12) A held to maturity bond investment must use the effective rate interest method. 13) Under private enterprise reporting an organization can use either the effective interest rate method or straight line to account for the amortization of their bond investment. 14) Investments in.
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10.6  Report investing transactions on the statement of cash flows 1) The purchase of investments would appear on a cash flow statement in the: A) operating activities section B) investing activities section C) financing activities section D) would not appear on a cash flow statement 2) The sale of an investment would appear on a cash.
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11) On January 1, 2011, Guided Light Corporation's Retained Earnings account had a balance of $275,000. During 2011, cash dividends of $50,000 were declared and stock dividends with a market value of $40,000 were declared. Net income for 2011 amounted to $120,000. What is the balance in Retained Earnings appearing.
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21) Prior-period adjustments are reported on the income statement for the period in which it is discovered an adjustment is necessary. 22) Corrections to the beginning balance of Retained Earnings for errors found within the current period are called prior-period adjustments. 23) Prior-period adjustments are made when an error occurs in one.
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9.5  Use share values in decision making 1) For a company that has only common shares outstanding, dividing total shareholders' equity by the number of shares outstanding determines the: A) liquidation value per share B) earnings per share C) market value per share D) book value per share 2) When a company has both common shares.
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10.2  Use the equity method for investments 1) Investments accounted for using the equity method are initially recorded at: A) fair market value of the investee company multiplied by the percentage of ownership acquired B) the total of the investee's equity accounts multiplied by the percentage of ownership acquired C) cost D) the lower of.
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11.3  Analyze shareholders' equity 1) A statement of shareholders' equity would not include which type of transaction? A) repurchased shares reacquired by the corporation B) land exchanged for machinery and equipment C) cumulative translation adjustment D) cash dividends declared by the board of directors 2) The financial statement that reports the changes in all categories of.
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1) Which of the following is not a characteristic that distinguishes corporations from proprietorships and partnerships? A) Corporations are separate legal entities apart from the owners. B) Corporate earnings are subject to double taxation. C) Corporations have mutual agency. D) Corporations have continuous lives regardless of changes in ownership. 2) Corporations are separate taxable entities..
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9.2  Account for the issuance of shares 1) Assets received in exchange for the issuance of stock should be recorded at: A) historical cost B) historical cost less accumulated amortization taken to date C) fair market value as determined by a good-faith estimate from independent appraisers D) book value prior to the issuance 2) Quo Corporation.
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8.6  Account for leases 1) Which of the following statements about capital leases is incorrect? A) A capital lease is a long-term financing obligation. B) A capital lease is noncancellable. C) Under a capital lease, the lessee's books do not report the leased asset. D) Under a capital lease, the lessee records a lease liability.
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10.5  Account for international operations 1) A foreign-currency transaction gain/loss is reported on the: A) balance sheet as an equity account B) income statement as other revenues/expenses C) income statement as an extraordinary item D) not reported on the income statement but is adjusted by debiting or crediting Retained Earnings 2) A foreign-currency translation adjustment is.
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8.7  Report liabilities on the balance sheet 1) Under IAS 39 financial liabilities must be measured at amortized cost. 2) Under IAS 39 financial liabilities must be measured at cost. 3) IFRS 7 required organizations to report the fair value of liabilities compared to their carrying amounts. 4) Under IAS 39 financial liabilities must.
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11) Liquidation value is the price the company agreed to pay to redeem their preferred shares when the shares were originally issued. 12) Koffler Corp. reported the following shareholders' equity: Share capital: Preferred shares, 30,000 shares authorized, 7,500 shares issued, redemption value, $53.50$ 393,750 Common shares, 200,000 shares authorized, 135,000 shares issued 607,500 Total share capital$1,001,250 Retained earnings.
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11) Following is the shareholders' equity section of the balance sheet of Easypix Corporation: Share capital: Preferred shares, 80,000 authorized, 50,000 issued$ 5,000,000 Common shares, 3,000,000 authorized, 1,500,000 shares issued 7,500,000 Total share capital$12,500,000 Retained earnings 4,800,000 Total shareholders' equity$17,300,000 Assuming Easypix purchases 15,000 shares of its common shares at $12.50 per share, the number of common.
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11) Stock dividends: A) are distributions of cash to the shareholders B) reduce the total assets of the corporation C) have no effect on total shareholders' equity D) increase the total liabilities of the corporation, and decrease the total shareholders' equity 12) Dividends in arrears on cumulative preferred shares are: A) reported as a current liability.
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12.2  Distinguish among operating, investing, and financing cash flows 1) The most important section of a cash flow statement is the: A) operating activities B) investing activities C) financing activities D) all of the sections are equally important 2) Which of the following activities increase and decrease the long-term assets available to a company? A) operating activities B).
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11.4 Understand managers' and auditors' responsibilities for the financial statement 1) Companies issuing publicly-traded stock are required to have their financial statements audited by an external auditor. This requirement is placed on corporations by the: A) Canada Revenue Agency B) Provincial Securities Commissions C) Various federal and provincial incorporating acts D) the Prime Minister of.
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31) Stock dividends result in a reduction in the balance of the contributed capital account. 32) The entry to record the declaration of a cash dividend includes a credit to retained earnings. 33) During 2010, Temper Pedic Corporation engaged in the following selected transactions: Jan.1Issued 15,000 common shares at $18 per share. June 15Reacquired.
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21) Following is the shareholders' equity section of the balance sheet of the Everslim Company: Share capital: Preferred shares, 420,000 shares authorized, 4,000 shares of $1.50 preferred issued$400,000 Common shares, 100,000 shares authorized, 30,000 shares issued 150,000 Total share capital$550,000 Retained earnings 267,000 Total shareholders' equity$817,000 The preferred shares are currently selling for $102.25 per share and the common.
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11) Which of the following entries brings the dollar amount of the total liabilities and shareholders' equity of a foreign subsidiary into agreement with the dollar amount of its total assets? A) the foreign-currency translation adjustment B) the hedging adjustment C) the amortization of the foreign-currency rate D) the foreign-currency rate of return adjustment 12).
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28) On January 1, 2010, Red Deer Corporation paid $360,000 to purchase 32% of the outstanding voting stock of English Court Corporation. The equity method is used to account for the investment. The following data relate to this investment. 2010 ?Dividends received from English Court Corporation amounted to $20,000. ?Net income reported by.
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11) An example of a postretirement benefit provided by a company is medical insurance for retired workers. 12) A defined contribution plan is one where the company promises the employee a specific monthly benefit upon retirement. 13) A defined benefit pension plan is one where the company promises the employee a specified.
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11) C-series Corporation's net income for the year ending on December 31, 2010, was $365,000. At the end of 2010, the corporation had outstanding 4,000 shares of $10 nonconvertible preferred shares and 10,000 common shares issued at $20. No shares were issued or retired during 2010. The numerator to be.
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11) Retail Energy Corporation paid $1,300,000 on January 1, 2011, to purchase 32% of the outstanding shares of Natural Gas Limited. If this investment is accounted for using the equity method of accounting, and Natural Gas Limited reports $450,000 of net income in 2011, the following entry will be made.
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11) Alliance Agreement Corporation is considering two plans for raising $2,500,000 to expand its current operations. The first plan involves the sale of $2,500,000, 8%, 10-year bonds sold at face value. The second plan involves selling 50,000 common shares at $50 each. Alliance Agreement Corporation currently has outstanding 200,000 shares.
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11) Activities which lead to an increase or decrease in long-term debt of a corporation are referred to as: A) operating activities B) investing activities C) financing activities D) future debt activities 12) Only the operating activities section of a cash flow statement is prepared differently when using the indirect method. 13) Only the investing activities.
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21) Contributed capital as shown on a corporate balance sheet includes the share accounts and any contributed surplus as well as retained earnings. 22) Preferred shares are a hybrid between common shares and long-term debt. 23) The president of the corporation can declare dividends. 24) Explain the fundamental difference between retained earnings and.
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11.2  Account for a corporation's income tax 1) Taxable income is found on the: A) income statement B) balance sheet C) tax return D) retained earnings statement 2) Pretax accounting income is found on the: A) income statement B) balance sheet C) tax return D) retained earnings statement 3) When pretax accounting income exceeds taxable income: A) Prepaid Income Tax is debited B).
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10.4  Account for long-term investments in bonds 1) The amortization of a discount on a long-term bond investment: A) decreases the investor's Long-Term Investment account B) decreases the investor's interest revenue C) increases the investor's interest revenue D) increases the investor's interest expense 2) Amortization of a discount or premium on the bond affects all of.
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9.3  Describe how share repurchase transactions affect a company 1) Which statement below regarding a share repurchase is true? A) A share repurchase grows a company's assets and equity. B) The company repurchasing shares is not entitled to vote. C) Repurchasing shares shrinks a company's assets and equity. D) Repurchasing shares increases retained earnings. 2) A.
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11) The adjusting entry for investments contains a credit to Investments for $651. The income statement will reflect: A) revenue of $651 B) an extraordinary gain of $651 C) other comprehensive income/loss of ($651) D) nothing, because gain/loss is not reported on the income statement 12) The Gain/Loss on the sale of Available for Sale.
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11) A statement of responsibility is prepared by the: A) external auditor stating his/her area of responsibility in preparing the audit B) the company controller stating his/her area of responsibility in assisting with the audit C) the company controller stating his/her responsibility for the preparation, integrity, and objectivity of the financial statements D) company.
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9.4  Account for dividends 1) When a cash dividend is declared: A) the Cash account is debited. B) the Cash account is credited. C) the Retained Earnings account is debited. D) the Retained Earnings account is credited. 2) A dividend becomes a legal liability of the corporation on the: A) date of payment B) date of declaration C) date.
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