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Study Resources (Accounting)

31) If a bank reconciliation included deposits in transit amounting to $1,500, the journal entry to record this reconciling item would include: A) no entry is required B) a credit to Accounts Receivable for $1,500 C) a debit to Cash for $1,500 D) a credit to Cash for $1,500 32) If a bank statement included.
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11) The postclosing trial balance contains which of the following accounts? A) Depreciation Expense B) Service Revenue C) Accumulated Depreciation D) Dividends 12) Which of the accounts listed below is not a temporary (or nominal) account? A) Dividends B) Rent Expense C) Sales Revenue D) Salary Payable 13) Salaries expense a permanent account, so it is not closed as the.
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14) The following transactions for Carleton Company occurred during January 2010: 1Purchased a two-year insurance policy for cash, $8,400. 4Paid utilities bill received in December 2009, $450. 9Performed a service on account, $1,200. 16Paid bimonthly salary to employees, $2,700. 21Received $800 from a customer on account. 25Received $600 from January 9 transaction. 30Prepared the adjusting entry for.
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11) Business risks are risks that companies will not achieve its objectives. 12) E-commerce creates risks such as computer viruses and stolen credit card numbers. 13) Internal control procedures include: proper approvals, unlimited access, adequate records and safeguard controls. 14) The controller is the chief accounting officer in an organization. 15) An audit represents.
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2.4  Use a trial balance 1) This summarizes all the account balances for the financial statements and shows whether total debits equals total credits: A) ledger B) trial balance C) journal D) accounting equation 2) The normal balance of Accounts Receivable is a ________ because it is a(n) ________ account. A) credit, liability B) debit, expense C) credit, shareholders'.
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4.3  Prepare and use a bank reconciliation 1) When preparing a bank reconciliation, which of the following items would be subtracted from the bank balance on the bank statement? A) deposits in transit B) bank service charges C) EFT cash payments D) outstanding cheques 2) When preparing a bank reconciliation, which of the following items would.
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3.6  Use financial statements in decision making 1) The current ratio is computed by: A) dividing current assets by current liabilities B) dividing current assets by long-term liabilities C) dividing current liabilities by current assets D) dividing current assets by long-term assets 2) Which of the following would not be part of a retailer's business cycle? A).
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57) State the effect on net income, total assets, total liabilities, and shareholders' equity if the following adjustments are omitted by completing the chart below. a.Utilities expense incurred but not yet paid, $350. b.Supplies used during the current period, $650. c.Service revenue earned, but not yet collected, $4,500. d.Unearned revenue earned during the period,.
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41) Given the following transactions for Clip Corporation, prepare a trial balance as of March 31, 2011. a. Owner invested $15,250 cash and $6,500 worth of equipment into the business received common shares in return. b. Purchased supplies on account, $450. c. Rented office space paying one month's rent, $850. d. Performed services for.
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41) Record entries for the following transactions for UTF-8 Corp. UTF-8 Corp. maintains an Allowance for Uncollectible Accounts. a. Sold merchandise on account to Java Ltd., $1,800. b. Sold merchandise on account to Centera, $759. c. Wrote off both the Java Ltd. and the Centera accounts. d. Centera unexpectedly paid off his account in.
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1) All of the following are purposes of internal control except: A) to safeguard assets B) to ensure accurate and reliable accounting records C) to encourage adherence to company policies D) to promote operational inefficiency 2) Who has the primary responsibility for establishing and maintaining a company's system of internal control? A) the company's top management B).
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2.3  Record transactons in a journal 1) The accounting process of copying of amounts from the journal to the appropriate ledger accounts is referred to as: A) journalizing B) footing C) balancing D) posting 2) Which of the following items of information would not normally be included in a journal entry? A) the date the transaction took.
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3.3  Adjust the accounts 1) An accountant who uses the accrual basis of accounting receives cash in advance for services yet to be performed. The entry to record this transaction will include a credit to which of the following accounts? A) Unearned Service Revenue B) Prepaid Expense C) Unearned Expense D) Service Revenue 2) A company.
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62) Briefly explain the difference between the cash basis of accounting and the accrual basis of accounting. Are adjusting entries necessary under both methods? Under the accrual basis of accounting, the accountant recognizes the impact of a business transaction on an entity when the transaction occurs, whether or not cash is.
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5.2  Account for receivables 1) A ledger that contains a separate account for each customer is called an accounts receivable: A) control ledger B) current ledger C) trade ledger D) subsidiary ledger 2) Receivables are monetary claims against others. 3) Two major types of receivable include: account receivables and notes payable. 5.3  Apply internal controls to receivables 1) A.
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4.2  Set up an internal control system 1) For effective internal control in an organization, who should keep the inventory records? A) accountant B) treasurer C) sales persons D) inventory warehouse supervisor 2) Which characteristic will not be found in an effective system of internal control? A) a combination of duties B) a separation of duties C) competent, reliable,.
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11) Under the allowance method, the entry to reinstate an account previously written off: A) increases total assets B) increases net income C) decreases net income D) has no effect on net income 12) Which principle of accounting prescribes the use of the allowance method of accounting for bad debts? A) full disclosure principle B) historical cost.
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11) The adjusting entry for supplies used during the current period will involve a credit to: A) Supplies B) Supplies Expense C) Accrued Supplies D) Supplies Revenue 12) An adjustment of an asset for which the business paid cash in advance is: A) a deferral B) an accrual C) unearned revenue D) revenue recognition 13) The adjusting entry to allocate.
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9) The unadjusted trial balance for Water & Malt Inc. appears below as of December 31, 2010. Water & Malt Inc. Unadjusted Trial Balance December 31, 2010 DebitCredit Cash$35,300 Accounts receivable16,000 Prepaid insurance5,000 Supplies1,500 Equipment20,000 Accumulated depreciation-equipment$3,200 Accounts payable11,000 Unearned service revenue9,800 Common shares27,000 Retained earnings17,000 Dividends1,000 Service revenue24,600 Salary expense 8,200 Utilities expense800 Rent expense3,600 Advertising expense1,200________ $92,600$92,600 Additional data is as follows: ?Supplies used during the current year amount to $700. ?Accrued.
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11) Short term investment purchases are recorded at their cost. 12) Investments held by a corporation are always classified as current assets. 13) Accounting for a short term investment is the same as accounting for a note receivable. 14) What are 'trading investments'? 15) Vance Corporation purchases UXB shares on May 10 for $120,000. .
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3.2  Recognize revenue and record expenses 1) An accrual refers to an event: A) where the expense or revenue is recorded after the cash settlement B) where the liability is recorded after the cash settlement C) where the expense or revenue is recorded before the cash settlement. D)  where the asset is recorded after the.
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22) Prepare journal entries in good form for the following transactions for the Calorie Corp. a.Owner invested cash of $12,000 and office equipment valued at $7,500 into the business, receiving common shares in exchange. b.Purchased supplies for cash, $1,000. c.Paid $750 for one month's rent on the store. d.Billed a client $1,500 for services.
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46) A junior bookkeeper, Bob Delisle, prepared the following trial balance on April 30, 2011, for Big Party Inc.. Prepare a corrected trial balance based on the incorrect trial balance and the additional data. Big Party Inc. Trial Balance April 30, 2011 DebitCredit Cash$5,740 Accounts Receivable$6,720 Prepaid Insurance1,480 Supplies320 Land9,000 Machinery15,660 Accounts Payable5,000 Note Payable13,000 Common Shares6,000 Retained Earnings6,800 Dividends3,860 Service Revenue16,400 Salary.
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9) Explain how net realizable value for accounts receivable is calculated. On which financial statement is net realizable value shown? 10) Global Alliance Ltd has just established a lock-box account at a local bank. Explain what this is and why it would be used. Identify the specific element of internal control.
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11) The entry to record an owner investment of $500 into the business would be: A) Dividends500 Cash500 B) Cash500 Dividends500 C) Cash500 Service Revenue500 D) Cash500 Common Shares500 12) The entry to record an owner investment of $1500 into the business including a $500 piece of equipment would be: A) Dividends1500 Equipment500 Cash1000 B) Cash1500 Dividends1500 C) Cash1500 Service Revenue1000 Equipment500 D) Cash1000 Equipment500 Common Shares1500 13) The entry to.
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2.5  Analyze transactions using only T-accounts 1) Use T-accounts to analyze the following transactions for the Red Panda Corporation: a. Owner invested $550,500 cash and equipment with a value of $5,500 into the business received common shares in return. b. Purchased office supplies on account, $300. c. Performed services for a customer on.
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21) Using the percentage-of-sales method, you estimate that total uncollectible accounts are $4,500. The Allowance for Uncollectible Accounts prior to adjustment has a credit balance of $1,400. The amount of the adjusting entry is: A) $5,900 B) $4,500 C) $3,100 D) $1,400 22) Using the percentage-of-sales method, you estimate that total uncollectible accounts are $4,500..
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31) When an account is written off using the direct write-off method, net income will: A) remain the same B) increase C) decrease D) cannot be determined 32) The best way to account for bad debts is to use the allowance method. 33) Many companies use both the percentage-of-sales and the aging-of-accounts-receivable methods together. 34) Under the.
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11) The asset requiring the highest level of internal control is: A) Cash B) Accounts Receivable C) Inventory D) Capital Assets 12) To maintain effective internal control, the majority of all payments in an organization should be made using cash. 13) Signature cards are one example of a bank account control document. 14) All cash receipts.
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3.4  Prepare the financial statements 1) In what order are financial statements generally prepared? A) balance sheet, statement of retained earnings, and income statement B) income statement, statement of retained earnings, and balance sheet C) income statement, balance sheet, and statement of retained earnings D) statement of retained earnings, income statement, and balance sheet 2) Why.
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4.4  Apply internal controls to cash receipts and cash payments 1) A petty cash system facilitates: A) payments of all business expenses by cash B) payments of all business expenses by cheque C) payment of small business expenses by cash D) receipt of small invoices from customers in cash 2) To control payments for purchases of.
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21) The postclosing trial balance for Adam Samuel Corporation on December 31, 2010, is shown below. Adam Samuel Corporation Postclosing Trial Balance December 31, 2010 DebitCredit Cash$24,500 Accounts receivable5,400 Supplies850 Prepaid insurance2,100 Building40,500 Accumulated amortization-building$7,500 Equipment22,300 Accumulated amortization-equipment3,400 Accounts payable6,500 Unearned service revenue8,400 Salary payable 900 Common shares50,200 Retained earnings________18,750 $95,650$95,650 a.Calculate the current ratio and the debt ratio. Assume the unearned service revenue will be earned within six.
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5.4  Estimate uncollectible receivables 1) The Uncollectible Account Expense account is classified: A) as a contra-asset account B) as part of cost of goods sold C) as the cost to the seller of extending credit D) deducted from Accounts Receivable account on the balance sheet 2) The two accepted methods of recording bad debts are the: A).
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12) Prepare the bank reconciliation and adjusting entries for Mac Moose Company for April 30 2011 using the following information: ?The balance per the April 30, 2011 bank statement is $25,500.01. ?Outstanding cheques as of April 30, 2011, amount to $13,655.00. ?Deposits in transit as of April 30, 2011, amount to $8,730.00. ?The balance.
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1) Short-term investments: A) are equity securities B) are debt securities C) may be classified as either debt or equity securities D) represents Accounts Receivable and notes receivable on the balance sheet 2) Short-term investments are also called: A) temporary investments B) marketable securities C) temporary investments or marketable securities D) notes receivable 3) The purchase of short-term investments: A) increases.
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1) There are two methods used to account for transactions. These methods are: A) cash and deferral B) cash and accrual C) accrual and deferral D) deferral and prepaid 2) The accounting convention that ensures accounting information is reported at regular intervals is the: A) revenue principle B) matching principle C) full disclosure principle D) time-period concept 3) An accountant.
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52) Prepare adjusting entries dated December 31, 2010, based on the following data. a.A two-year insurance policy costing $3,000 was purchased on October 31, 2010. b.Salaries owed to employees on December 31, 2010, amount to $2,300. c.The balance in Supplies before adjustment is $1,400. A physical count reveals $450 of supplies on hand.
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27) Prepare journal entries in good form for the following transactions at Snacktime Corp.: a. Jill (owner) invested cash of $25,000 receiving common shares in exchange. b. Purchased inventory on credit, for $9,000. c. Paid $3,000 for rent of the Snack shop. d. Received $4,700 for services rendered. 28) Where is information for each account.
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