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Study Resources (Accounting)

Learning Objective 3.7 Questions 1) The SEC requires publicly held companies to file 10-K reports within ________ after the fiscal year ends. A) 30 days B) 60 days C) 90 days D) 120 days E) none of the above 2) Two of the largest developers of ERP systems are ________ and ________. A) Microsoft and Oracle B) Microsoft and.
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Learning Objective 3.5 Questions 1) The entry to close revenue accounts involves A) a debit to Income Summary and credits to all the revenue accounts. B) debits to all the revenue accounts and a credit to Income Summary. C) debits to all the expense accounts and credits to all the revenue accounts. D) a debit.
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Learning Objective 3.4 Questions 1) Which of the following accounts would not be found on the credit side of a trial balance? A) Equipment B) Accounts Payable C) Retained Earnings D) Sales Revenue E) Paid-in Capital 2) Given the following balances, what would the total credits in the trial balance equal? 1. Equipment $52,000 2. Accounts Payable 1,000 3. Sales.
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11) The adjusting entry to record accrued salaries earned includes a debit to accrued salaries payable. 12) Failure to adjust for an unrecorded expense such as wages expense will overstate net income and stockholders' equity for the period. 13) Failure to adjust for an unrecorded expense such as interest expense will understate.
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Learning Objective 5.4 Questions 1) Chorba Chocolates had the following account balances on its balance sheets at December 31, 2012 and 2011, respectively: 12/31/12 12/31/11 Fixed Assets $80,000 $67,000 Accumulated Depreciation 44,000 39,000 Depreciation expense for 2012 was $7,000. There were no gains or losses on the 2012 income statement. One fixed asset with an.
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55) Prepare the journal entries for each of the six transactions depicted in the following T-accounts, along with a brief explanation as to the nature of the transaction. CashPrepaid RentSales      ---------------    ---------------     ------------- (1) 11,000| 350 (2)(2) 350||1,600 (4) (5) 400|450 (6)| Accounts ReceivableAccounts PayableCost of Goods Sold       -----------------    -------------     ---------------- (4).
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Learning Objective 4.5 Questions 1) If Company A has an accrual of interest to be received on a note receivable, then the company should debit A) Interest expense. B) Accrued interest payable. C) Accrued interest receivable. D) Interest revenue. E) Cash. 2) Which of the following is an example of an accrual of unrecorded revenues? A) Interest accrues.
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Learning Objective 4.6 Questions 1) The order of the steps in the recording process has A) the adjusted trial balance after preparing the financial statements. B) the journalization and posting of adjustments before the ledger. C) the adjusted trial balance before the ledger. D) journalization after the adjusted trial balance. E) the unadjusted trial balance after.
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Learning Objective 6.1 Questions 1) A long term contract to provide services for New York City was awarded to Mason Technology on December 30, 20X1. The 4-year contract is set for $160 million and payment is certain. Services are to be provided evenly over 20X2 through 20X5. Progress measures are dependable,.
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Learning Objective 3.2 Questions 1) The recording process has a sequence of five steps. What is the specific order of the steps? A) Journal, trial balance, financial statements, ledger, transaction documentation B) Transaction documentation, journal, ledger, trial balance, financial statements C) Transaction documentation, ledger, journal, trial balance, financial statements D) Ledger, journal, transaction documentation, trial.
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Learning Objective 3.6 Questions 1) Which of the following errors would a trial balance help the accounting staff to find? A) A sale for $8,300 occurred, and instead of debiting Cash for $8,300, Accounts Receivable was debited for $8,300. B) A sale for $8,300 occurred, and instead of debiting Cash for $8,300, Accounts.
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20) Bearington Motors Income Statement For the Year Ended December 31, 2012 Sales $624,000 Less Expenses: Cost of Goods Sold $332,000 Wage Expense 211,000 Depreciation Expense 20,000 Rent Expense 18,000 Income Tax Expense 16,000 597,000 Net Income $ 27,000 Bearington Motors Balance Sheet December 31, 2011 and 2012 12/31/12 12/31/11 12/31/12 12/31/11 Current Assets: Current Liabilities: Cash $ 8,100 $ 10,600 Accounts Payable $ 57,200 $59,900 Accts..
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11) Formation, Inc. had the following balances as of December 31, 2012. Prepare closing entries based on these balances. Equipment $26,000 Retained Earnings 7,000 Accumulated Depreciation $ 4,500 Paid-in Capital 21,400 Cost of Goods Sold 59,000 Supplies 4,300 Wages Payable 1,200 Sales 112,000 Cash 34,000 Accounts Payable 7,200 Wage Expense 36,000 Rent Expense 8,000 Merchandise Inventory 12,700 Dividends (Amount Declared) 3,000 12) Morrill Law Offices.
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Learning Objective 5.6 Questions 1) The indirect method of preparing the statement of cash flows A) is seldom used by companies because of the extra effort required to gather cash flow information. B) calculates only the cash effect of each operating activity. C) is the method preferred by the FASB. D) begins with net income,.
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23) Given the following year-end balances, prepare a classified balance sheet for Briggs Manufacturing dated December 31, 2012. (Hint: Compute net income first.) Interest Expense $ 2,000 Beginning Retained Earnings 13,100 Depreciation Expense 5,200 Cash 26,900 Accounts Payable 3,300 Rent Expense7,200 Accumulated Depreciation, Equipment 13,500 Wage Expense 59,200 Prepaid Rent 1,400 Paid-in Capital 9,000 Accounts Receivable 13,600 Wages Payable 3,200 Equipment 63,000 Sales 249,600 Inventory.
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Learning Objective 4.3 Questions 1) Which of the following situations involves a deferral? A) Recording accrued interest B) Recording accrued wages C) Recording revenue earned but not yet received D) Recording revenue earned that was collected in advance E) None of the above are deferrals. 2) The adjustment for revenue received in advance, which has been earned.
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Learning Objective 5.7 Questions 1) Which of the following statements is incorrect, regarding the effect of depreciation expense on a statement of cash flows using the indirect method? A) Depreciation expense is not an outflow of cash. B) Depreciation expense represents an inflow of cash. C) Depreciation expense is added in the operating activities.
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11) Implicit transactions are events such as cash receipts and disbursements that trigger nearly all day-to-day routine entries. 12) Some explicit transactions (e.g., the loss of assets due to fire) do not involve actual exchanges of goods and services between parties. 13) Every adjusting entry affects one income statement account and one.
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Learning Objective 5.5 Questions Exhibit 5-1 Cartell Paper Products Balance Sheet December 31, 2012 and 2011 12/31/12 12/31/11 Current Assets: Cash $ 4,600$ 3,100 Accounts Receivable 9,6007,900 Inventory 17,500 18,600 Supplies 1,200 2,100 Prepaid Insurance 1,400 1,000 Total Current Assets 34,300 32,700 Long-term Assets: Fixed Assets 71,000    58,000 Accumulated Depreciation (30,400)        (26,500) Patent 6,0007,100 Total Long-term Assets 46,600 38,600 Total Assets $ 80,900         $ 71,300 Current Liabilities: Accounts Payable $.
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11) Which of the following transactions increase cash? 1. Sales of goods and services for cash 2. Receiving cash dividends 3. Collection of accounts receivable 4. Reclassifying long-term debt to short-term debt 5. Accruing interest revenue A) 1 and 2 B) 1 and 3 C) 1, 2, and 3 D) 1, 2, 3, and 4 E) 1, 2, 3, and.
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9) Two companies have the following balance sheets as of December 31, 2012: Reef Company Cash $ 25,000 10% Note Payable, $ 50,000 Other Assets 75,000 Stockholders' Equity 50,000 Total Liabilities And Total Assets $100,000 Stockholders' Equity $100,000 Score Company Cash $ 25,000 Other Assets 75,000 Total Assets $100,000Stockholders' Equity $100,000 In 2012, each company had sales of $225,000 and.
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3) The issuance of a long-term debt for cash would appear on the statement of cash flows as a(n) A) investing activity. B) operating activity. C) financing activity. D) equity activity. E) debt activity. 4) The issuance of stock for cash would be classified as a(n) A) investing activity on the statement of cash flows. B) equity activity.
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23) Cash flows from financing activities include the payment of interest on a note payable. 24) A transaction in which long-term debt of $50,000 is converted to common stock would be reported in the financing section of the cash flow statement. 25) Dividends received from a subsidiary would be classified as an.
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14) The excess of cash over current liabilities is known as working capital. 15) Working capital is the difference between total assets and total liabilities. 16) The current ratio can help users of financial statements assess a business entity's liquidity. 17) A high current ratio means that a company is highly profitable. 18) The.
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Learning Objective 5.8 Questions 1) The balance sheet equation provides the conceptual basis for all financial statements and can be rearranged to incorporate the statement of cash flows as follows: A) Cash + Noncash assets = Liabilities + Stockholders' equity B) Cash - Noncash assets = Liabilities + Stockholders' equity C) Assets = Liabilities.
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Learning Objective 4.8 Questions 1) Gross profit appears on a A) single-step income statement. B) classified balance sheet. C) multiple-step balance sheet. D) multiple-step income statement. E) single-step balance sheet. 2) Which account is usually a separate line item on the multiple-step income statement? A) Cash B) Dividends C) Paid-in capital D) Retained earnings E) Income taxes 3) Gross profit is defined as A).
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Learning Objective 5.3 Questions 1) Cleft Company had the following account balances on its balance sheet at December 31, 2012 and 2011, respectively: 12/31/12 12/31/11 Long-term Bonds Payable $39,000 $36,000 Assume no bonds were retired during 2012. What was the positive cash flow associated with the long-term debt for Cleft Company in 2012? A) $10,000 B) $3,000 C).
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4) Working capital is defined as A) the difference between paid-in capital and retained earnings. B) the difference between current assets and current liabilities. C) the difference between cash and retained earnings. D) the difference between sales and cost of goods sold. E) the difference between total assets and total liabilities. 5) Clokgel Inc. likes to.
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11) Publishing for Personnel, Inc., received and paid its utility bill of $800. As the accountant, you would tell the bookkeeper to A) debit Utility Expense and credit Cash for $800. B) debit Cash and credit Utility Payable for $800. C) debit Cash and credit Utility Expense for $800. D) debit Cash and credit.
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Learning Objective 4.4 Questions 1) An example of an adjusting entry is A) the payment of wages that have been accrued. B) the accruing of interest expense. C) the return of defective inventory. D) the payment of rent in advance. E) collection of an accounts receivable. 2) An adjusting entry made to record accrued interest on a.
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Learning Objective 5.1 Questions 1) Which of the following statements show the results of a company over a period of time? 1. Balance sheet 2. Income statement 3. Statement of cash flows 4. Statement of stockholders' equity A) 2 and 4 B) 3 and 4 C) 1 D) 2 E) 2, 3, and 4 2) The statement of cash flows has.
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11) Journalizing amounts for unearned revenue can cause ethical dilemmas for many accountants since estimates are often used when exact completion amounts are uncertain. Discuss potential problems that this may cause for financial statement users. How does the concept of conservatism affect an accountant's recognition of revenue of a particular.
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13) All of the following would be included in a company's investing activities except A) purchase of land. B) payment of dividends. C) collection of loan repayments. D) purchase of equipment. E) purchase of another company's stock. 14) All of the following would be included in a company's financing activities except A) issuing equity securities. B) purchasing treasury.
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11) Neslund Ornamentals offered a 2% trade discount to Parsons Retail Outlet for all purchases over $200,000. Parsons Retail Outlet purchased $300,000 from Neslund Ornamentals on account. Neslund uses the periodic inventory system. Which of the following is the journal entry made by Neslund Ornamentals to recognize the sale and.
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Learning Objective 4.9 Questions 1) Which of the following statements is true with respect to the gross profit percentage? A) The gross profit percentage shows the relationship of net income to sales revenue. B) The gross profit percentage is widely regarded as the ultimate measure of overall accomplishment. C) Retailers have high gross profit.
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Learning Objective 4.1 Questions 1) Which of the following is an example of an accrual? A) Wages incurred but not yet paid. B) Payment of insurance 8 months in advance. C) Purchase of equipment for use in the business. D) Revenue collected in advance from customer. E) All of the above. 2) Which of the following statements.
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11) Not recognizing depreciation expense in a given month will A) understate total assets. B) understate total revenues. C) overstate total liabilities. D) overstate net income. E) have no effect since this is a temporary error. 12) If depreciation expense is not recorded for the current accounting period, total assets will be understated. 13) If the entry.
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51) Liabilities are known as contra assets. 52) The accumulated depreciation is sometimes referred to as the allowance for depreciation. 53) Prepare the necessary journal entries for each of the following transactions for Klokel, Inc. a. Klokel, Inc. sold 1,200 shares of common stock at $30 per share in cash. b. The company purchased.
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Learning Objective 4.2 Questions 1) The adjusting entry to recognize periodic depreciation expense has what effect on the basic accounting equation? A) Decrease in assets, decrease in liabilities B) Decrease in assets, increase in liabilities C) Decrease in assets, increase in stockholders' equity D) Decrease in assets, decrease in stockholders' equity E) None of these 2) An.
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41) Posting is the transferring of amounts from the journal to the appropriate accounts in the ledger. 42) The purchase of office supplies on account would include a debit to accounts payable and a credit to office supplies. 43) The purchase of office equipment on account would increase assets and decrease stockholders'.
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12) Listed below are several accounts from Process Improvements, Inc. for the year ended December 31, 2012. Next to each account indicate its normal balance and whether you would need to debit or credit the account to decrease it. Use DR for debit and CR for credit. Account Normal Balance To Decrease Prepaid rent Notes.
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57) Selected accounts from Taylor Company as of March 31, 2012, follow: Cash $ 5,300 Inventory 10,250 Prepaid rent 100 Plant 40,500 Accumulated depreciation, plant 10,000 Accounts payable 6,300 Paid in capital 20,000 Retained earnings ? In addition, the following transactions occurred in the month of March. 1. Depreciation for the month amounted to $700 2. Purchased inventory on account for $3,000 3. Returned a portion of the inventory.
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26) Bearpaw Tours Income Statement For the Year Ended December 31, 2012 Sales $624,000 Less Expenses: Cost of Goods Sold $332,000 Wage Expense 211,000 Depreciation Expense 20,000 Rent Expense 18,000 Income Tax Expense 16,000597,000 Net Income $ 27,000 Bearpaw Tours Balance Sheet December 31, 2011 and 2012 12/31/12 12/31/11  12/31/12 12/31/11 Current Assets: Current Liabilities: Cash $ 8,100 $ 10,600 Accounts Payable $ 57,200 $59,900 Accts. Rec..
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Learning Objective 6.2 Questions 1) Lazareth Machine Metals sold inventory to Talla Manufacturing for $5,000 cash. Which of the following is the journal entry made by Lazareth Machine Metals? Assume the periodic inventory system is used. A) Cost of Goods Sold 5,000 Sales 5,000 B) Cash 5,000 Inventory 5,000 C) Accounts Receivable 5,000 Sales 5,000 D) Cash 5,000 Sales.
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