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41. Revenues have the effect of increasing stockholders’ equity.  42. The Supplies Inventory account will appear as an expense on the income statement.  43. The statement of retained earnings discloses the dividends distributed during the period.  44. The heading for a balance sheet might include the line “For the Month Ended December 31, 20--.”  45. The balance sheet is.
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68. The cost-adjusted-to-market method of accounting for investments is used when the investment is A. controlling.B. influential and noncontrolling.C. noninfluential and controlling. noninfluential and noncontrolling. 69. For available-for-sale equity securities, the Unrealized Loss on Long-Term Investments account should be reported as a(n) A. realized loss item on the income statement.B. prior period adjustment.C. contra-asset on the balance sheet. other comprehensive income (loss). 70. For available-for-sale.
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81. Buying and selling goods and services are examples of operating activities.  82. A major function of financial accounting is to provide the investor with relevant and useful information.  83. The evaluation and interpretation of financial statements and related performance measures is called technical analysis.  84. Responsibility for ethical financial reporting rests solely with the accountant.  85. The intentional.
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41. When a new partner is admitted, the old partnership agreement is still in effect.  42. If the asset accounts did not reflect their current values, the asset accounts would need to be adjusted before admitting the new partner.  43. Admission of a new partner never has an impact on net income.  44. When a withdrawing partner.
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98. Delta and Chen form a partnership and invest the following assets and liabilities 99. Briyanna and Greg form a partnership and invest the following assets and liabilities.  Greg’s building is subject to a $40,000 mortgage that is not assumed by the partnership. 100. Erin, Rachel, and Travis are partners in ERT Company, with average.
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21. The board of directors appoints the audit committee, which in turn performs an independent audit of the company’s records.  22. The articles of incorporation may be found in the corporate charter.  23. Authorized shares of stock refer to the number of shares currently held by the stockholders.  24. Corporate governance is the oversight of a company’s.
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140. Which of the following is a regulatory agency? A. IASBB. SECC. FASBD. GASB 141. Which of the following is an example of an investing activity? A. Purchasing a buildingB. Paying off a loanC. Employing workersD. Producing goods and services 142. Which of the following is an example of a financing activity? A. Paying taxes to the governmentB. Selling equipmentC. Obtaining a bank loanD. Purchasing land 143. A company's ability to attract.
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21. When a partner invests a noncash asset into the partnership, the partner’s Capital account is debited and an asset account is credited.  22. Income is divided equally among the partners unless the partnership agreement specifies otherwise.  23. The division of income is one area in which a partnership differs from a corporation.  24. If a partnership.
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119. On January 1, Tenkotte Corporation purchased, as long-term investments, 10 percent of the voting stock of Gibbs Corporation for $75,000 and 25 percent of the voting stock of Rieger Corporation for $150,000. During the year, Gibbs Corporation had earnings of $40,000 and paid dividends of $15,000 on October 15, and.
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21. When the market value of available-for-sale securities exceeds cost, an unrealized loss appears in stockholders' equity as an addition.  22. Trading securities are always short-term investments.  23. Trading securities appear as current assets on the balance sheet at their historical cost regardless of subsequent increases or decreases in market value.  24. An increase or decrease in.
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51. The account ‘Wages Payable’ would appear on the income statement.  52. An increase in expenses will have the effect of reducing stockholders’ equity.  53. Due care means carrying out one's professional responsibilities with competence and diligence.  54. Independence means subordinating personal gain to service and the public trust.  55. The Public Company Accounting Oversight Board (PCAOB) was created.
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121. In the journal provided, prepare the entries for the transactions described below. (Omit explanations.) May 5 Purchased 120-day Treasury bills for $39,000. This investment will be held to maturity. Sept. 2 Treasury bills matured; $40,000 received. (No prior entries were made to recognize revenue.) GENERAL JOURNAL Date Description Post.Ref. Debit Credit 122. In the journal provided, prepare the entries for the transactions described below..
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31. Stockholders’ equity equals assets minus liabilities.  32. Inventory is an example of a nonmonetary asset.  33. Financial position may be assessed by referring to a balance sheet.  34. Creditors' equities is another term for liabilities.  35. One way of stating the accounting equation is: Assets - Liabilities = Stockholders’ Equity.  36. The economic resources invested in a business by the.
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116. The following transactions and information pertain to Myers Corporation for 2013 and 2014. 2013 May 1 Purchased 2,000 shares of Galvez Corporation common stock at $20 per share (representing 5 percent of Galvez's total outstanding stock) as a long-term investment. Sept. 1 Received a cash dividend from Galvez equal to $0.60 per share. Dec. 31 Market value of Galvez stock.
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95. Chelsea, Jack, and Connor have a partnership.  Chelsea wishes to withdraw from the partnership by removing assets that are greater than her current capital balance.  Discuss who, if anyone, receives a bonus. 96. Describe how a dissolution of a partnership is different from a liquidation of a partnership. 97. Match the following terms with.
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31. When the equity method is used to account for an investment in stock, dividends received by the investor decrease the investment account.  32. It is possible that an investor with less than a 50 percent ownership interest may qualify for accounting recognition of control and appropriately prepare consolidated financial statements.  33. Under the equity.
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41. When bonds are purchased between interest dates, the buyer must pay (in addition to the bonds' cost) the amount of interest that has accrued since the last interest payment date.  42. U.S. Treasury bills are considered equity securities.  43. Held-to-maturity securities are valued on the balance sheet at cost adjusted for the effects of.
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51.Which of the following is a true statement regarding the internal rate of return in capital budgeting?   A. It provides the same basic information as the net present value method. B. It calculates the net present value of future cash flows. C. It calculates the proposal's rate of return. D. It doesn't consider the time value of money. 52.Which.
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71. Less than 20 percent of the U.S. economy is generated by governmental and not-for-profit organizations.  72. Paying taxes to the government is an example of an operating activity.  73. Managerial accounting focuses on internal decision making.  74. Not-for-profit organizations have no obligation to report their financial performance to outside parties.  75. Regulatory agencies are considered information users with.
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11. An individual can be prosecuted by the SEC for insider trading whether or not that individual is employed by the company involved.  12. Investments are valued on the balance sheet at the original purchase price, even if the price has changed since the date of purchase.  13. Held-to-maturity securities are always debt securities, and.
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54. Which of the following is a characteristic of partnerships? A. Unlimited lifeB. Limited liabilityC. Involuntary associationD. Mutual agency 55. The ability of a partner to enter into a contract on behalf of all partners is called A. the partnership agreement.B. voluntary association.C. mutual agency.D. unlimited liability. 56. Which of the following does not result in the dissolution of a partnership? A. Death of a partnerB. Admission of.
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74. Alex, Clinton, and Evan are in a partnership. Evan decides to withdraw from the partnership by selling his interest to Linsey. Alex and Clinton agree to this. Alex's Capital account and Clinton's Capital account A. will not be affected when Linsey is admitted.B. will decrease when Linsey is admitted.C. will increase when Linsey is.
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112. Indicate the letter of the term that matches the description below. 113. On November 19, 2013, Bristol Company purchased 30,000 shares of JCN Corporation stock for $480,000, and 10,000 shares of Nystrom Corporation stock for $250,000. Bristol's management intends to hold all 40,000 shares for a short period of time. On.
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98. When a company purchases debt securities, it records them at A. cost, ignoring any commissions and fees. cost plus commissions and fees.C. cost less commissions and fees.D. the value expected at maturity. 99. If the maturity date of Treasury bills is less than 90 days, they are classified as  cash equivalents.B. short-term investments.C. long-term investments.D. current liabilities. 100. Company A purchases U.S. Treasury.
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1. A partnership is an accounting entity separate and apart from its owners.  2. As long as the action is within the scope of the partnership, any partner can bind the partnership.  3. One of the benefits of forming a partnership is limited liability.  4. Each partner is personally liable only for his/her share of the debts.
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120. Sinoyianis Realty Company had the following balance sheet accounts and balances: Accounts Payable $12,000 Common Stock $10,000 Accounts Receivable 2,000 Equipment 14,000 Building 16,000 Land 14,000 Cash 6,000 Retained Earnings 30,000 If $6,000 of Accounts Payable were paid in cash, what would be the balance of the Retained Earnings account? A. $8,000B. $28,000C. $30,000D. $36,000 121. Sinoyianis Realty Company had the following balance sheet accounts and balances: Accounts Payable $12,000 Common Stock $ 10,000 Accounts Receivable 2,000 Equipment 14,000 Building 16,000 Land 14,000 Cash 6,000 Retained Earnings 30,000 If $6,000 of.
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90. The correct order of the three stages of accounting is A. communication, processing, and measurement.B. measurement, communication, and processing.C. processing, measurement, and communication.D. measurement, processing, and communication. 91. The communication stage of accounting is accomplished by A. storing data.B. reporting to decision makers.C. processing data.D. recording data. 92. Which of the following is the most appropriate definition of accounting? A. Electronic collection, organization, and communication of.
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1. Gains and losses on the sale of investments appear as adjustments within the financing activities section of the statement of cash flows.  2. Another term for short-term investments is marketable securities.  3. Investments with a maturity of less than ninety days are generally classified as cash equivalents.  4. As long as an investment can be sold.
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90. List four advantages and four disadvantages of the partnership form of business. 91. Warren and Spencer are partners in a drilling operation. Warren purchased a drilling rig to be used in the partnership's operations. Is this purchase binding on Spencer even though he was not involved in it? Explain your answer. 92. Discuss how.
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31. It is possible to invest no tangible assets into a partnership, yet be given a positive opening capital balance.  32. When the existing partners pay a bonus to a newly admitted partner, the existing partners' accounts are debited.  33. When a newly admitted partner pays a bonus to the existing partners, the new partner's.
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11. The day-by-day accumulation of interest is considered a transaction involving an exchange of value.  12. Sole proprietorships in the United States generate more business (in terms of receipts) than partnerships and corporations put together.  13. A corporation is an economic unit that is legally separate from its owners.  14. Corporations represent the largest number of businesses.
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150. Those who lend money or deliver goods and services before being paid are called A. investors.B. debtors.C. underwriters.D. creditors. 151. The purchase of land is an example of a(n) A. investing activity.B. operating activity.C. capital activity.D. financing activity. 152. Which of the following is an example of an operating activity? A. Obtaining capital from ownersB. Selling goods and services to customersC. Purchasing equipmentD. Selling land 153. The Sarbanes-Oxley Act of 2002.
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1. The processing stage of accounting is accomplished by the recording of data.  2. The terms “bookkeeping” and “accounting” are not synonymous.  3. A company's management information system is a subsystem of its accounting information system.  4. Accountants focus on the needs for financial information by both internal and external decision makers.  5. Accountants consider money the common unit.
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88. Kent Corporation holds 1,900 shares of Russell Corporation common stock as its sole long-term investment. Kent does not have significant influence or control over Russell. The stock was purchased during 2013 at a price of $120 per share. On December 31, 2013, the market price of Russell’s stock was $108.
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103. Fred, Kristina, and Nick each receive a $14,000 salary, as well as 15 percent interest on their respective average investments of $40,000, $20,000, and $80,000. If they share remaining income in a 4:3:2 ratio, respectively, by how much would Nick's account increase assuming net income of $81,000. 104. Paul, Quinn, and Ralph.
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107. Investments are initially recorded in accounting records at cost.  However, after the purchase, the value on the balance sheet may be adjusted due to subsequent conditions.  List three such subsequent conditions. 108. Distinguish between the financial statement presentation of unrealized gains and losses related to trading securities and the financial statement presentation.
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48. The purchase and sale of debt and equity securities would appear in which section of the statement of cash flows? A. Operating activities Investing activitiesC. Financing activitiesD. Noncash investing and financing activities 49. Which of the following is not a category of investments? A. Held-to-maturity securitiesB. Trading securities Collateral securitiesD. Available-for-sale securities 50. Which of the following categories of investments can be debt but.
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110. Which of the following is the correct accounting equation? A. Assets = Liabilities + Stockholders’ EquityB. Assets + Stockholders’ Equity = LiabilitiesC. Assets = Liabilities – Stockholders’ EquityD. Assets + Liabilities = Stockholders’ Equity 111. The best definition of assets is the A. cash owned by the company.B. resources belonging to a company having future benefit to the company.C. collection of.
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130. The statement of cash flows would disclose the purchase of a building for cash A. nowhere on the statement.B. in the operating activities section.C. in the investing activities section.D. in the financing activities section. 131. The Public Company Accounting Oversight Board was created by the A. Sarbanes-Oxley Act.B. GASB.C. IRS.D. IASB. 132. The authoritative body currently responsible for establishing accounting practice is the A. Internal Revenue.
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117. Foltz Corporation purchased 3,000 shares of Craver Corporation common stock for $160 per share on January 1, 2013, as a long-term investment. Craver reported net income of $140,000 and $180,000 for 2013 and 2014, respectively, and paid dividends of $50,000 and $60,000 during 2013 and 2014, respectively. Craver has a.
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61. Objectivity is the avoidance of all relationships that impair or appear to impair the objectivity of the accountant.  62. Both public accountants and managerial accountants are required to adhere to a code of professional conduct.  63. The Federal Reserve Board is an example of a consumer group.  64. The primary external users of accounting information are.
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78. Barkely Corporation has invested in the stock of two other corporations, Hayes Corporation and Motz Corporation. Barkely does not own a controlling interest or exercise significant influence over either corporation. Barkely's accountant is preparing financial statements and has compiled the following information: Stock Name No. of Shares Cost Market Hayes   1,000 $46,000 $48,000 Motz      500 $55,000 $51,000 What should be the.
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100. Which of the following is legally a separate entity from its owner(s)? A. Sole proprietorship onlyB. Sole proprietorship and partnership onlyC. Corporation onlyD. Partnership only 101. Most business enterprises in the United States are A. government units.B. partnerships.C. sole proprietorships.D. corporations. 102. Transfer of ownership will affect the continuity of a A. corporation.B. sole proprietorship.C. partnership.D. sole proprietorship or partnership. 103. All of the following statements about partnerships are true except A. partners.
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11. There is no income tax imposed on a partnership.  12. An informational tax return must be filed for a partnership.  13. If the partnership agreement does not describe the method of income and loss distribution, the partners must share income and losses equally.  14. When individuals invest property in a partnership, the property becomes an asset.
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41.The principal weakness of the payback method for evaluating proposed investments is that it does not:   A. provide a way of ranking projects in order of desirability. B. consider cash flows that continue after the investment has been recovered. C. result in an easily understood "answer". D. recognize the time value of money. 42.The accounting rate of return method.
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64. A partner invests into a partnership a building with a $50,000 carrying value and $80,000 fair market value. The related mortgage payable of $25,000 is assumed by the partnership. The entry to record the investment in partnership is: A. Building                   50,000      Mortgage Payable                      25,000    .
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114. On November 28, 2013, Elliott Company purchased 10,000 shares of Ferno Corporation stock for $360,000. Elliott’s management intends to hold the shares for a short period of time. On December 31, 2013, the price of Ferno stock was $30 per share. Finally, on January 19, 2014, Elliott sells all 10,000.
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58. All of the following are conditions that could affect the valuation of investments on the balance sheet except  changes in the general purchasing power of the dollar.B. changes in the operations of investee companies.C. changes in the market value or fair value of the investments.D. changes caused by the passage of time. 59. The ability of.
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