ACC 100 Unit 4 Final Exam Milestone Sophia course

1

Ed, the owner of of Ed's Electronics, purchased 35 DVD players at $12 each. He paid the invoice in full within 20 days, which reduced the price of each DVD player to $10.

 

Which of the following amounts would be recorded in the purchases account of Ed's Electronics? 

 

$350

 

 

$420

 

 

$525

 

 

$595

 

Merchandising: Purchases, Sales, Discounts, Returns and Allowance

2

 

 

Based on the information from the last six months (shown here), which of the following is the current ratio?

 

9.08

 

 

7.31

 

 

6.46

 

9.24

 

 

Ratio Analysis

3

Which of the following is a benefit of Robert having a subsidiary purchases ledger for his food and beverage supply company?

 

Determining which vendors Robert supplies most frequently 

 

Calculating whether a client should be issued credit

 

Calculating the total amount spent paying monthly payroll

 

Determining how often customers make cash payments 

 

Sales & Purchases Subsidiary Ledger

4

Which of the following is responsible for conducting an independent examination of a company's financial statements and records?

 

Stakeholder

 

Auditor

 

Controller

 

Bookkeeper

 

Accounting in Practice

5

A company's sales for the year were $549,650 and a credit to Allowance for Bad Debt for $16,489.50 was made.

 

Based on this entry, what percentage of sales is considered uncollectible?

 

3.5%

 

2.5%

 

3%

 

4%

 

Allowance Method: Percentage of Net Credit Sales and Percentage of Receivables

6

As she updates her accounting documents at the end of the accounting period, what kind of documentation does Jody need to make if she discovers an unrecorded receipt for the $275 purchase of a new window?

 

Adjusting entry

 

Supply expense

 

Accrued revenue

 

Owner withdrawal

 

Adjusting Entries

7

Which of the following is NOT true of a natural balance?

 

Each account is associated with only one account group.

 

Each individual account has a natural balance.

 

An account increase occurs on the opposite side of the account's natural balance.

 

Each account group has a natural balance.

 

Natural Balance

8

Which of the following describes unearned revenues?

 

$45,000 in total payroll owed to employees on May 1

 

$1,500 in sales tax collected

 

$3,500 paid to a company for services it will provide next week

 

The accounts payable totals $9,500

 

Current Liabilities

9

 

 

Which inventory method was used to calculate cost of goods sold, based on the information above?

 

LIFO

 

Weighted average

 

FIFO

 

Specific ID

 

Inventory Cost Flow Assumptions

10

With respect to financial statements, which of the following statements is true of depreciation?

 

Accumulated depreciation is credited below the referenced asset.

 

Land is depreciated on a 25-year schedule.

 

The residual value of the asset is determined by the government.

 

Depreciation can be taken beyond the residual value of the asset.

 

Depreciation

11

Which of the following about inventory turnover is true?

 

It measures the number of times that the inventory is sold and replaced.

 

It measures the inventory that is sold and replaced.

 

It measures the inventory that is bought and replaced.

 

It measures the number of times that the inventory is replaced.

 

Ratio Analysis

12

Bart paid $150,000 for a piece of equipment for his business. Bart's income statement puts the straight line depreciation rate at 20%, and the equipment is expected to have a residual value of $1,000 at the end of its useful life, which is expected to be five years.

 

 

Using double declining balance depreciation, what is the value of the piece of equipment at the end of year one?

 

$60,000

 

$100,000

 

$90,000

 

$120,000

 

Accelerated Depreciation

13

Which one of the businesses below would be best served by the periodic inventory method?

 

Online mass consumer goods retailer

 

 

Fish market

 

 

Restaurant

 

Construction equipment dealer

 

 

Inventory Accounting Methods

14

On September 30, 2018, Grover began preparing a trial balance worksheet.

 

Which step occurs immediately after he prepares the income statement?

 

Closing Entries

 

Trial Balance

 

Adjusting Entries

 

Balance Sheet

 

End of Period Activities

15

LONG TERM ASSET

ASSET: BALANCING MACHINE

COST  $9,000

PREPAID INSURANCE        $750

MAINTENANCE COSTS     $900

ACCULUMATED DEPRECIATION            $1,500

BOOK VALUE          _____

 

Using the information shown here, which of the following is the book value of the balancing machine?

 

$8,100

 

 

$8,250

 

$7,500

 

 

$7,350

 

 

Financial Reporting of Long Term Assets

16

If a company had a beginning balance of $69,000 on its statement of changes in owner's equity, the owner had drawings of $15,000 and the ending balance was $76,000, how much net income was recorded?

 

$91,000

 

$22,000

 

$61,000

 

$76,000

 

Preparing Statements of Changes in Owner's Equity

17

Which illustration below correctly shows Paula opening her baby clothing store with a monetary investment of $9,250.00?

 

 

 

 

 

Journal Entries

18

If Tom earned $1,890 in revenue from selling running shoes at last weekend's triathlon expo.

 

Where would this accounting event be recorded?

 

$1,890 would be marked on the credit side of the accounts payable.

 

$1,890 would be marked on the debit side of the revenue account.

 

$1,890 would be marked on the debit side of the accounts payable.

 

$1,890 would be marked on the credit side of the revenue account.

 

Debit and Credit

19

 

 

Based on the information above, calculate the Cost of Goods Purchased.

 

$9,550

 

 

$13,375

 

$13,450

 

$9,475

 

Expanded Income Statement

20

Examine the partial balance sheet vertical analysis below. 

 

 

Based on the information shown, what is the correct amount and percentage of accounts payable?

 

$20,000; 25%

 

$22,000; 25%

 

$18,000; 22.5%

 

$20,000; 20%

 

Vertical Analysis and Horizontal Analysis

21

What is the name of the accounting system documented in the 15th century by Luca Pacioli?

 

Double-entry

 

Monetary unit

 

Cost

 

Managerial

 

Origins and Ethics

22

As she prepared financial documents to be discussed at her company's annual shareholders' meeting, Linda added an appendix to the financial overview that details all financial transactions in the last fiscal year.

 

Which of the accounting principles below is she observing?

 

Matching Principle

 

Time Period Principle

 

Full Disclosure Principle

 

Measurement Principle

 

ual Framework and Principles

23

An account that is not closed at the end of the accounting period is called a(n) __________.

 

expense account

 

temporary account

 

permanent account

 

income summary account

 

Closing Entries

24

Which of the following best describes a non-profit organization?

 

One in which the leadership is governed by a board of directors

 

One that relies solely on private donations for the organization’s financial needs

 

One that reinvests profit into the organization instead of distributing it to owners

 

One in which the workforce is made up of volunteers

 

Businesses and Organizations

25

Which of the principles below does Val follow when she reviews her records to make sure that recorded accounting events correspond to the actual costs?

 

Measurement principle

 

 

Matching principle

 

 

Time period principle

 

Full disclosure principle

 

 

ual Framework and Principles

1

What is the total of Tim’s assets if he has recorded $9,000 in liabilities and $3,000 as equity on a balance sheet?

 

$3,000

 

$6,000

 

$15,000

 

$12,000

 

Preparing Balance Sheets

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2

 

 

Based on the information above, which of the following is the straight line depreciation of the equipment?

 

$7,500

 

 

$7,000

 

$7,700

 

 

$7,300

 

 

Straight Line Depreciation

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3

If Tonya purchased 200 decorative pillows at $12 each and sold 75 of the pillows for $20 each, what is the cost of goods sold?

 

$1,100

 

$2,400

 

 

$900

 

 

$1,500

 

 

Merchandising

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4

Which of the following is NOT a good use of a T-account?

 

Analyzing a complicated transaction, prior to recording the event in the general journal

 

Prior to recording an entry, to see the effect of the debits and credits on each account

 

To make sure the debits and credits in each transaction are equal

 

Transferring final balances of accounts to the company's financial records

 

T-Accounts, Cash Entries

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5

 

 

Based on the information below, calculate the Cost of Goods Purchased.

 

$38,000

 

$34,000

 

$25,000

 

$29,000

 

Expanded Income Statement

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6

Consider the following information:

 

Cash = $6,000

Beginning Balance = $200,000

Capital added = $15,000

Revenues = $10,000

Expenses = $5,000

Net Income = $56,000

Owner’s Withdrawals  = $60,000

What is the ending balance on the Statement of Changes in Owner's Equity for this data?

 

$224,000

 

$211,000

 

$221,000

 

$216,000

 

Preparing Statements of Changes in Owner's Equity

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7

Japeth's statement of changes in owner's equity shows net income of $25,000, owner's drawings of $5,000 and an ending balance of $65,000.

 

What was Japeth's beginning balance?

 

$70,000

 

$65,000

 

$95,000

 

$45,000

 

Statement of Changes in Owner's Equity

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8

Which of the following concerning unearned revenues is NOT true?

 

Adjusting entries are made at the end of a period to report unearned revenues.

 

They are found on a balance sheet.

 

They are recorded as a revenue account entry.

 

They are receipts for services or products that will be performed or delivered at a future date.

 

Current Liabilities

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9

Which illustration below correctly shows Jen opening her frozen yogurt store with a monetary investment of $5,000?

 

Journal Entries

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10

What is the formula for the rate of return on sales?

 

Gross Income / Net Sales

 

Gross Income / Gross Sales

 

Net Income / Gross Sales

 

Net Income / Net Sales

 

Ratio Analysis

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11

Roberta sold goods costing $35,500, her expenses totaled $2,500 and her freight in totaled $750. Her company's average stock of goods during the same period was $9,500.

 

The inventory turnover ratio for Roberta's company is __________.

 

3.74

 

3.47

 

3.39

 

3.55

 

Merchandising Financial Statement Analysis

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12

Which of the following is a violation of the Sarbanes-Oxley Act?

 

Merging with a competitor

 

Declaring bankruptcy

 

Giving shares of stock to employees

 

Not reporting financial information about a business

 

Origins and Ethics

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13

 

 

Using these end of period figures, which of the following is the rate of return on sales?

 

1.70

 

2.59

 

 

1.42

 

 

1.20

 

 

Ratio Analysis

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14

Which of the following is NOT depreciated because it does not get used up?

 

Automobiles

 

Land

 

Buildings

 

Land fixtures

 

Depreciation

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15

Which image below shows the correct general ledger account for Accounts Receivable?

 

 

Posting to the General Ledger

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16

What is the total of Tim’s liabilities if he has recorded $50,000 in assets and $40,000 equity on a balance sheet?

 

$10,000

 

$90,000

 

$100,000

 

$20,000

 

Preparing Balance Sheets

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17

The bookkeeper for Dr. Mark Scholz, DVM, informed the veterinarian that the business' revenue for the day was $18,920.

 

Which statement below best describes how the bookkeeper would record this? 

 

$18,920 would be recorded on the debit side of the owner's equity account.

 

$18,920 would be recorded on the credit side of the revenue account.

 

$18,920 would be recorded on the debit side of the purchases account.

 

$18,920 would be recorded on the credit side of the cash account.

 

Debit and Credit

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18

The statues and garden decorations in the warehouse belonging to Woodman’s Flowers and Gifts are considered which of the following?

 

Equity

 

Assets

 

Profits

 

Expenses

 

Account Groups

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19

 

 

Based on the information in this portion of an expanded income statement, what is the total of the Goods Available for Sale?

 

$92,000

 

$167,000

 

$138,000

 

$104,000

 

Expanded Income Statement

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20

 

 

Using the FIFO method and the information in this image, what is the Cost of Goods Sold during December?

 

$60,000

 

$80,000

 

$65,000

 

$95,000

 

FIFO

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21

What type of adjustment will Kyle make to his trial balance worksheet for $2,500 he was paid on October 12, for work that he will start on December 1?

 

Depreciation

 

Supplies

 

 

Accrued revenues

 

 

Unearned revenue

 

 

Adjusting Entries

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22

Which of the following is NOT a requirement of the General Accepted Accounting Principles (GAAP) for financial statements?

 

They must be relevant. 

 

They must be comparable. 

 

They must be principled.

 

They must be reliable. 

 

Governance

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23

What is the total of the owner's equity if the balance sheet shows liabilities of $38,000 and assets of $74,000?

 

$36,000

 

$38,000

 

$112,000

 

$2,000

 

Preparing Balance Sheets

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24

 

 

Using the LIFO method and the information in this image, what is the Cost of Goods Sold during December?

 

$105,000

 

$95,000

 

 

$80,000

 

 

$60,000

 

 

LIFO

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25

A company's year-end data shows the following amounts. 

Current assets $65,000

Current liabilities       $25,000

Net income     $7,500

Net sales         $125,000

Total assets     $150,000

 

Based on this information, what is the company's current ratio? 

 

1.9

 

2.3

 

6.0

 

2.6

 

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Status NEW Posted 18 Apr 2020 11:04 AM My Price 12.00

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