223_F06_prelim_1_Exam - Exam # _ HA-223 Financial...

Info iconThis preview shows pages 1–4. Sign up to view the full content.

View Full Document Right Arrow Icon
Exam # _________ HA-223 Financial Accounting Principles Prof. A. Neal Geller PRELIMINARY EXAMINATION 1 Question Sheet October 3, 2006 In Class STUDENT NAME: _____________________________________ CUID NUMBER: __________________________
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
True and False Section : Each question = 2 points 1. The amount of cash paid by a business for office utilities would be reported on the statement of cash flows as an operating activity. 2. The payment of a liability in cash will decrease owners' equity. 3. The cash account is credited when stock is sold to investors and a stockholders' equity account is debited. 4. When a company uses cash to purchase equipment, the cash out flows are reported as an investing activity. 5. Interest expense connected to notes payable is an example of a non-operating or peripheral expense. 6. Utilities expense and wages payable are both elements of the income statement. 7. When total assets decrease, it will cause a decline in the asset turnover ratio if sales stay the same. 8. Unearned rent revenue is an example of a liability account that will usually not be satisfied by payment of cash but rather by allowing the tenant to occupy the premises for which they have prepaid. 9. The full-disclosure principle requires a complete set of financial statements supported by notes to those statements. 10. The current ratio is computed by subtracting current liabilities from current assets.
Background image of page 2
: Each question = 2 points 11. The Beta Corporation had 2007 revenues of $200,000, expenses of $140,000, and an income tax rate of 30 percent. Net income after taxes would be A) $60,000. B) $18,000. C) $42,000. D) $48,000. E) None of the above is correct. 12. On January 1, 2006, two individuals invested $500,000 each to form Jordan Corporation. Jordan had total revenues of $200,000 during 2006 and $250,000 during 2007. Total expenses for the same periods were $120,000 and $140,000 respectively. Cash dividends paid out to stockholders totaled $20,000 in 2006 and $25,000 in 2007. What was Jordan’s total stockholders' equity at the end of 2006 and 2007? A) $1,000,000 and $1,065,000 respectively. B) $1,060,000 and $1,145,000 respectively. C) $1,100,000 and $1,170,000 respectively. D) $1,210,000 and $1,410,000 respectively 13. Which of the following is not a liability? A) Accounts payable. B) Retained earnings. C) Notes payable. D) Unearned Revenue. E) None of the above is correct. 14. Sale (issue) of stock to investors for $300,000 cash would A) increase cash by a debit and increase contributed capital by a credit. B) increase cash by a credit and increase contributed capital by a debit. C) increase retained earnings by a debit and increase cash by a credit. D)
Background image of page 3

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Image of page 4
This is the end of the preview. Sign up to access the rest of the document.

This test prep was uploaded on 02/19/2009 for the course HA 230 taught by Professor Davidlee during the Fall '06 term at Cornell University (Engineering School).

Page1 / 11

223_F06_prelim_1_Exam - Exam # _ HA-223 Financial...

This preview shows document pages 1 - 4. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online