281Exam 1 - Practice Questions for Exam 1 1. Which of the...

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Practice Questions for Exam 1 1. Which of the following does NOT appear on the balance sheet? a.   Net Income c.   Assets b.   Retained Earnings d.   Stockholders’ Equity 2. Which of the following would be considered a primary user  of  external   financial reporting? a.  managers c.   environmentalists b.  employees d.   creditors 3. Mr. Carr is a landlord who received a payment in advance from a tenant.  Upon receipt, this amount represents                                          to Mr. Carr.  a.   contributed capital c.   a liability b.   an asset d.   retained earnings 4. Green Company presented a financial statement appropriately dated “For  the Year Ended December 31, 2003.”  Which of the following statement(s)  should this be? a.  Income Statement b.  Statement of Retained Earnings c.   Either of the above d.   Neither of the above  5. Which of the following are typical temporary (closed at year end)  accounts? a.   Revenues c.   Expenses b.   Dividends d.   All of the above 6. Which of the following would not result in unearned revenue ?
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 Rent collected in advance from tenants b.  Services performed on account c.  Sale of season tickets to football games d.  Sale of two-year magazine subscriptions 7. Which of the following accounts would be closed during the closing  process? a.   Insurance Expense c.   Prepaid Insurance b.   Unearned Revenue d.   Accounts Payable 8. The process of transferring amounts from the journal to the ledger is  called: a.   posting. b.   journalizing. c.   balancing. d.   none of the above. 9. Which of the following transactions would violate the cost principle? a.   Company records a newly-acquired machine at its $5,000 cost. b.   Company borrows $10,000 from the bank, recording a $10,000                     liability. c.   Company records a gain on the increase in value of its land. d.   Company reports supplies at $1,000 cost. 10. Xanadu Corporation has $100,000 in assets and $30,000 in liabilities at  the beginning of the year.  At the end of the year, Xanadu has $120,000 in  assets and $35,000 in liabilities.  During the year, the company paid  dividends of $10,000 and issued stock in the amount of $5,000.  What was  Xanadu’s net income for the year? a.  $ 85,000
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281Exam 1 - Practice Questions for Exam 1 1. Which of the...

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