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AC 210 Exam 1 Version A Name: ______________________________________ CWID: ____________________ 1. A company pays its workforce on Fridays for a five day workweek (Monday through that Friday). The payroll for a week is $100,000 ($20,000 per day). If the accounting year-end 2011 falls on a Tuesday, the adjusting journal entry on December 31, 2011 to record the $40,000 accrual of wages for 2011 will include a A. debit to Salaries Payable of $100,000. B. debit to Salaries Expense of $40,000. C. credit to Salaries Payable of $60,000. D. credit to Cash of $40,000. E. debit to Salaries Payable of $40,000. The Statement of Cash Flows for the current year contained the following: The change in cash for the current year was an increase of $14,000. 2. What was the amount of Cash Flows from Investing Activities? A. Cash Outflow of $1,000 B. Cash Outflow of $40,000 C. Cash Outflow of $10,000 D. Cash Inflow of $10,000 E. None of the above 3. Recording an adjusting journal entry to recognize depreciation would cause which of the following? A. An increase in liabilities and expenses, and a decrease in stockholders' equity. B. A decrease in assets and stockholders' equity, and an increase in expenses. C. A decrease in assets, an increase in liabilities, and an increase in expenses. D. An increase in assets, an increase in liabilities, and a decrease in expenses 4. Which of the following would be reported on the income statement for the current year ? A. In the current year, the company sold goods to customers who agreed to pay next year. B. In the current year, the company received payment in cash for goods that were sold to customers last year. C. In the current year, the company borrowed money from the bank which is to be used in the business activities this year. D. In the current year, the company issued stock to owners and received cash immediately. E. More than one of the above. 5. At the end of the current year, a company paid cash to acquire a storage facility with plans to use it in its business activities for several years. Choose the TRUE statement. A. In the current year, total assets will decrease and stockholders' equity will decrease. B. In the current year, total assets will decrease and stockholders' equity will increase. C. In the current year, total assets and total stockholders equity will remain unchanged. D. This year, this activity will not result in any changes of any kinds to the balance sheet or the income statement. E. None of the above; all the above are false statements. The following accounts are taken from the December 31, 2011 financial statements of a company. 6. What is the amount of total liabilities at the end of 2011? A. $7,075 B. $10,075 C. $9,075 D. $12,975 E. None of the above 7. The first year of operations for a company was 2010. The net income for the year 2010 was $20,000 and dividends of $12,000 were paid. In 2011, the company reported net income of $34,000 and paid dividends of $5,000. At the end of 2010, the company had total assets of $34,000 and paid dividends of $5,000.... View Full Document

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