Final Winter07 - CONCORDIA UNIVERSITY DEPARTMENT OF...

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CONCORDIA UNIVERSITY FINANCIAL ACCOUNTING DEPARTMENT OF ACCOUNTANCY COMM 217 ALL SECTIONS FINAL EXAMINATION WINTER 2007 Duration: 3 hours Instructions : 1. This examination paper consists of 9 pages including this page. Please make sure your paper has all pages before commencing to write. 2. Write all your answers (including answers to multiple choice statements) in the examination answer booklet. You may answer the questions in any order you prefer. Only the answers in the examination booklet will be graded. 3. Read the questions carefully and budget your time wisely. Show all calculations. 4. This is a closed book examination. However, silent hand-held (not graphical) calculator and one standard language (not electronic) dictionary is permitted. 5. Invigilators will not answer questions (unless you think there is an error in the question). 6. Return the exam along with the answer booklets when you finished. Question Topic Total Marks 1 Multiple choice 24 2 Accounting for bonds 20 3 Merchandising transactions and inventory costing methods 20 4 Accounting for long-term assets 20 5 Financial statement analysis 16 Total 100
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Question 1 Multiple Choice (24 marks; 44 minutes) 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. Ramstetter, Inc. purchased a piece of land with a new building on January 1, 2006. The land was valued at $40,000 and the building was valued at $120,000 with a 40 year life and a zero salvage value. How would the land and building appear in the plant, property and equipment section of the December 31, 2006, balance sheet, assuming straight-line amortization? A) Land at $40,000 less accumulated amortization of $1,000; Building at $120,000 less accumulated amortization of $3,000. B) Land at $40,000; Building at $120,000. C) Land at $30,000; Building at $120,000. D) Land at $40,000; Building at $120,000 less accumulated amortization of $3,000. 2. HD Motorcycles has an inventory turnover ratio of 10.1 in 2006 compared to their competitor TT Motorcycle with a 2.6 ratio in 2006. Which of the following is the most likely cause of TT Co's lower ratio? A) Lower levels of inventory compared to HD B) It takes TT Co. fewer days to sell their inventory C) TT Co's smaller size makes it difficult for them to achieve the economies of scale in comparison to HD's scale of operations D) None of these causes their ratio to be lower 3. In 2006, Landings Inc. provided the following items in their footnotes. Their cost of goods available for sale was $6.2 billion under FIFO costing and their ending inventory value under FIFO costing was $2.1 billion. Their opening inventory was $2.5 billion. What were their purchases?
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This note was uploaded on 12/09/2009 for the course ACCO comm 217 taught by Professor Mroz during the Fall '09 term at Concordia Canada.

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Final Winter07 - CONCORDIA UNIVERSITY DEPARTMENT OF...

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