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Acc 201 Sample Test 1form 2 page 3

Acc 201 Sample Test 1form 2 page 3 - B The benefits of...

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Oberliessen’s Craft Shop had the following information available at year-end: Ending Retained Earnings $130,000 Dividends declared and paid $ 10,000 Beginning Retained Earnings $ 90,000 Total Expenses $ 50,000 8. Based on the above information, what were Oberliessen’s total revenues for the year? A. $ 50,000 B. $ 60,000 C. $ 90,000 D. $100,000 E. $110,000 9. On January 1, 2007 office supplies inventory for Ben’s Banjos Inc. were $500. Office supplies purchased and recorded as additions to the supplies inventory account during the year amounted to $900. Ben’s year-end inventory showed $600 of supplies on hand. What is the supplies expense for the year? A. $500 B. $900 C. $600 D. $800 E. some other amount 10. Which of the following best describes the conservatism principle? A. Accountants should avoid overstating assets and understating expenses.
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Unformatted text preview: B. The benefits of accounting for and reporting information should outweigh the costs. C. Amounts that are immaterial can be reported in the most practical matter. D. Long-standing and accepted accounting practices in a particular industry may differ from Generally Accepted Accounting Principles. E. All financial information must be on a company’s financial statements. 11. On July 1, 2007 Nicole’s Auto Body Shop Inc. purchased a two-year insurance premium amounting to $1500 which was paid for in cash and debited in full to Prepaid Insurance. Coverage began on July 1, 2007. What is the amount of prepaid insurance on the December 31, 2007 Balance Sheet? A. $1,500 B. $1,125 C. $ 375 D. $ 750 E. some other amount 1...
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