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CONCORDIA UNIVERSITY FINANCIAL ACCOUNTING DEPARTMENT OF ACCOUNTANCY COMM 217 ALL SECTIONS FINAL EXAMINATION FALL 2007 Introduction (READ THIS PAGE – IT CONTAINS IMPORTANT INFORMATION) 1. This examination consists of Five (5) Questions printed on nine (9) pages including this page. The last page of the exam shows present value tables . Make sure your copy of the exam is complete before starting. 2. Write all your answers (including answers to multiple-choice statements) in the lined examination answer booklet that has been provided to you separately. Only the answers in the lined examination booklet will be graded. You may answer the Questions in any order. 3. Your answers must be written in ink. 4. Read the Questions carefully and budget your time carefully. Show details of all calculations, except for Multiple-choice. Attempt all Questions. 5. This is a closed book examination; no reference to notes, etc. is allowed. However, a silent hand-held calculator and one standard (not electronic) dictionary are permitted. 6. Invigilators will not answer questions , unless you think there is an error in the examination questionnaire. 7. When you have finished submit your exam booklet(s) and this questionnaire. Question Topic Marks 1 Multiple-choice 27 2 Accounting for inventory 18 3 Accounting for property, plant and equipment 19 4 Accounting for long-term debt 16 5 Calculation and interpretation of financial ratios 20 Total 100
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Question 1 (27 marks; 50 minutes) Multiple Choice For each of the following, choose the letter that corresponds to the best answer, and write the letter in your examination booklet, not on this examination paper . Each correct answer is worth 1.5 marks. 1. Reliability and relevance are two primary characteristics of accounting information. Which of the following qualities should accounting information have in order to be relevant? A. Predictive value and verifiability B. Neutrality and timeliness C. Timeliness and feedback value D. Representational faithfulness and verifiability 2. The qualitative characteristic that says accounting information can influence users' decisions is A. Comparability. B. Materiality. C. Relevance. D. Reliability. 3. Which of the following statements best describes the matching principle? A. Revenue and the expenses that were incurred to earn that revenue should be reported in the same accounting period. B. Total assets should equal total liabilities and shareholders’ equity. C. Revenues should be recognized when they are earned and realized. D. Debits should always be equal to credits. 4. Kam Company Ltd.’s ending inventory is understated by $4,000. The effects of this error on the current year’s cost of goods sold and net income, respectively, are: A. understated and overstated B. overstated and understated C. understated and understated D. overstated and overstated 5. The primary purpose of hiring a public accounting firm to examine the financial statements of the company is A. To assure no fraud has been committed by the company's management. B.
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This test prep was uploaded on 04/17/2008 for the course COMM 217 taught by Professor Smroz during the Fall '07 term at Concordia Canada.

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