The basis for classifying assets as current or noncurrent is the period of time normally required by the accounting entity to convert cash invested in
Select one:
a. tangible fixed assets back into cash, or 12 months, whichever is longer.
b. receivables b
D
Treasury stock should be reported as a(n)
Select one:
a. investment
b. increase of stockholders equity
c. decrease of stockholders equity
d. current asset
C
A generally accepted method of valuation is
1. trading securities at market value.
2. accounts receivable at net realizable value.
3. inventories at current cost.
Select one:
a. 1
b. 1 & 2
c. 3
d. 2
B
The stockholders' equity section is usually divided into what three parts?
Select one:
a. Preferred stock, common stock, treasury stock
b. Capital stock, appropriated retained earnings, unappropriated retained earnings
c. Capital stock, additional paid-in
C
In preparing a statement of cash flows, cash flows from operating activities
Select one:
a. can be calculated by appropriately adding to or deducting from net income those items in the income statement that do not affect cash.
b. are always equal to accru
A
Typical contractual situations that are disclosed in the notes to the balance sheet include all of the following except
Select one:
a. lease obligations
b. advertising contracts
c. pension obligations
d. debt covenants
B
Fulton Company owns the following investments:
Trading securities (fair value) $160,000
Available-for-sale securities (fair value) 70,000
Held-to-maturity securities (amortized cost) 94,000
Fulton will report investments in its current assets section of:
C
Lohmeyer Corporation reports:
Cash provided by operating activities $320,000
Cash used by investing activities 110,000
Cash provided by financing activities 140,000
Beginning cash balance 90,000
What is Lohmeyers ending cash balance?
Select one:
a. $ 440,
A
During 2017 the DLD Company had a net income of $85,000. In addition, selected accounts
showed the following changes:
Accounts Receivable $3,000 increase
Accounts Payable 1,000 increase
Buildings 4,000 decrease
Depreciation Expense 1,500 increase
Bonds Pa
A
All of the following are TRUE except:
Select one:
a. Because of the historical cost principle, fair values may not be disclosed in the balance sheet.
b. Companies determine cash provided by operating activities by converting net income on an accrual basis
A
A trial balance:
Select one:
a. is normally prepared three times in the accounting cycle.
b. All of these answer choices are correct.
c. proves that debits and credits are equal in the ledger.
d. supplies a listing of open accounts and their balances that
B
All of the following are FALSE except:
Select one:
a. All liability accounts and stockholders equity accounts are increased on the credit side and decreased on the debit side.
b. A ledger is where a company first records transactions and other selected ev
D
When a corporation pays a note payable and interest,
Select one:
a. the account interest expense will be decreased.
b. they will debit cash.
c. they will debit notes payable and interest expense.
d. the account notes payable will be increased.
C
A journal entry to record a receipt of rent in advance will include a
Select one:
a. debit to Rent Revenue
b. credit to Rent Revenue
c. credit to Unearned Revenue.
d. credit to Cash.
C
Which of the following errors will cause an imbalance in the trial balance?
Select one:
a. Posting a credit of $720 to Accounts Payable as a credit of $720 to Accounts Receivable.
b. Omission of a transaction in the journal.
c. Posting an entire journal e
D
An adjusting entry should never include
Select one:
a. a debit to a revenue account and a credit to a liability account.
b. a debit to an expense account and a credit to a revenue account.
c. a debit to a liability account and a credit to revenue account.
B
Tate Company purchased equipment on November 1, 2017 and gave a 3-month, 9% note with a face value of $80,000. The December 31, 2017 adjusting entry is
Select one:
a. debit Interest Expense and credit Cash, $1,200.
b. debit Interest Expense and credit Int
B
During the first year of Wilkinson Co.'s operations, all purchases were recorded as assets. Supplies in the amount of $28,800 were purchased. Actual year-end supplies amounted to $6,600. The adjusting entry for store supplies will
Select one:
a. increase
C
The omission of the adjusting entry to record depreciation expense will result in an
Select one:
a. overstatement of assets and an overstatement of owners' equity.
b. understatement of assets and an understatement of owner's equity.
c. overstatement of li
A
Adjustments are often prepared
Select one:
a. after the balance sheet date, but dated as of the balance sheet date.
b. after the balance sheet date, and dated after the balance sheet date.
c. before the balance sheet date, and dated after the balance shee
A
Assume ABC Company deposits $90,000 with First National Bank in an account earning interest at 6% per annum, compounded semi-annually. How much will ABC have in the account after five years if interest is reinvested?
Select one:
a. $90,000
b. $ 120,953
c.
B
An amount is deposited for eight years at 8%. If compounding occurs quarterly, then the table value is found at
Select one:
a. 2% for 32 periods.
b. 2% for eight periods.
c. 8% for 32 periods.
d. 8% for eight periods.
A
If you invest $50,000 to earn 8% interest, which of the following compounding approaches would return the lowest amount after one year?
Select one:
a. Daily
b. Quarterly
c. Monthly
d. Annually
D
Betty wants to know how much she should begin saving each month to fund her retirement. What kind of problem is this?
Select one:
a. Present value of an ordinary annuity.
b. Present value of one.
c. Future value of one.
d. Future value of an ordinary annu
D
Which factor would be greater ��" the present value of $1 for 10 periods at 8% per period or the future value of $1 for 10 periods at 8% per period?
Select one:
a. Present value of $1 for 10 periods at 8% per period.
b. Need more information
c. The factor
D
What is the primary difference between an ordinary annuity and an annuity due?
Select one:
a. The timing of the periodic payment.
b. The interest rate
c. Ordinary annuity only relates to present values.
d. Annuity due only relates to present values.
A
Paula purchased a house for $300,000. After providing a 20% down payment, she borrowed the balance from the local savings and loan under a 30-year 6% mortgage loan requiring equal monthly installments at the end of each month. Which time value concept wou
D
Charlie Corp. is purchasing new equipment with a cash cost of $300,000 for an assembly line. The manufacturer has offered to accept $68,900 payment at the end of each of the next six years. How much interest will Charlie Corp. pay over the term of the loa
C
Use of the double-declining balance method
Select one:
a. results in a decreasing charge to depreciation expense.
b. means the book value should not be reduced below salvage value.
c. all of these answers are correct.
d. means salvage value is not deducte
C
Grover Corporation purchased a truck at the beginning of 2017 for $109,200. The truck is estimated to have a salvage value of $4,200 and a useful life of 120,000 miles. It was driven 21,000 miles in 2017 and 29,000 miles in 2018. What is the depreciation
C
Piazza Co. purchased a machine on July 1, 2017, for $1,000,000. The machine has an estimated useful life of five years and a salvage value of $200,000. The machine is being depreciated from the date of acquisition by the 150% declining-balance method. For
D
McDonald Company acquired machinery on January 1, 2012 which it depreciated under the straight-line method with an estimated life of fifteen years and no salvage value. On January 1, 2017, McDonald estimated that the remaining life of this machinery was s
D
Jasmine Company purchased a depreciable asset for $375,000. The estimated salvage value is $25,000, and the estimated useful life is 8 years. The double-declining balance method will be used for depreciation. What is the depreciation expense for the secon
C
Cumulative Comprehensive Income
Net Income + Accumulated Other Comprehensive Income