Quiz 2.2006 - ACCOUNTING 4711 FINANCIAL ACCOUNTING WINTER...

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ACCOUNTING 4711 FINANCIAL ACCOUNTING W INTER 2006 Quiz #2 Name: (Print) Student Number: Instructions 1. This quiz has 15 points and ends in 50 minutes. 2. Print your name on this cover sheet and initial each page in the upper right-hand corner. 3. Answer the multiple choice questions in Problem I by circling the letter of the best answer. 4. Answer Problem II in the appropriate spaces provided in the exam. Clearly label your work and show all calculations. You may unstaple the exam booklet, but please reattach all sheets in the correct order. 5. Use only a non-programmed calculator, pens, and/or pencils. No other materials are permitted. 6. The quiz consists of ten pages (including this cover sheet). 7. Good luck. Business School Honor Policy We, the members of the Business School community – students, faculty, and staff – commit ourselves to do our work and perform our duties honestly. We understand that in striving for excellence in performance, our personal and institutional integrity is our most precious asset; and accordingly, we will not knowingly act in ways that erode our integrity. Because we are an academic community, honesty in our academic work is vital. Therefore, we pledge neither to cheat nor to tolerate cheating. I acknowledge that I have been directed to work individually on this examination. I certify that I have neither given nor received prohibited aid on this examination. Signature
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PROBLEM I – 10 MULTIPLE CHOICE (1 points each) 1. On September 21, 2005, Amy’s Fashion Boutique sold 10 pairs of designer jeans for $1,000 cash. Assume the company uses the indirect (periodic) method to account for inventory. What is the correct journal entry for the transaction on September 21, 2005? a. Debit cash for $1,000, credit sales revenue for $1,000. b. Debit cash for $1,000, credit inventory for $1,000. c. Debit sales revenue for $1,000, credit cash for $1,000. d. None of the above. 2. Soccer Stores Incorporated, purchased inventory for $29,000 on account. What is the correct journal entry for the transaction? a. Debit cash for $29,000, credit inventory for $29,000. b. Debit inventory for $29,000, credit cash for $29,000. c. Debit inventory for $29,000, credit accounts receivable for $29,000. d. Debit accounts receivable for $29,000, credit inventory for $29,000. e. None on the above. 3. After the end of 2005 but before producing financial statements for 2005 Smith’s Shoe Shop conducted an audit of its revenue account. After a thorough audit, the auditors found that the revenue account was overstated by $23,000. The auditors found that although the money had already been collected, Smith’s Shoe Shop had not yet shipped the products. Smith’s Shoe Shop uses the indirect (periodic) method to account for its inventory. Making the proper journal entry to correct for the error will result in which of the following? a.
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This note was uploaded on 06/11/2008 for the course ACC 471 taught by Professor Winkle during the Winter '08 term at University of Michigan.

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Quiz 2.2006 - ACCOUNTING 4711 FINANCIAL ACCOUNTING WINTER...

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