F10_Exam_2-Form_A - Exam #: Fundamentals of Financial...

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Exam #: Fundamentals of Financial Accounting ACC 311 Fall 2010 Exam 2, Form A Name Instructor Section Meeting Time DO NOT OPEN until given instructions to do so. Instructions 1. Assume that the accrual basis of accounting applies to all questions , unless a question specifically instructs otherwise. 2. Confirm that you have 14 numbered pages. There are also two blank sheets of paper at the end of the exam that you may use for scratch paper. 3. On your Scantron answer sheet, write and bubble in your name, section (unique) number, and the Test Form letter noted above. 4. Use a #2 pencil only to mark your responses on your Scantron answer sheet. Mark clearly and erase completely as needed. You should also mark your answers on your exam. However, only multiple choice answers marked on your Scantron answer sheet will be graded. 5. Multiple choice questions are 2 points each; all other questions have their point value noted with the problem. 6. Cell phones and PDA's are NOT allowed and must be turned off and put away during the exam. Calculators capable of storing text (programs) are not allowed. You may use a basic or financial calculator with numerical memory functions only. 7. Bring your entire exam, Scantron answer sheet and student ID to the front of the room when you have finished. 8. You are reminded of the University’s honor policy which requires you do your own work and not give or receive assistance on this exam.
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Acc 311 - Exam 2 Form A page 1 SECTION I - MULTIPLE CHOICE (50 points - 2 points each) - Please choose the BEST answer for each question and record your answer on the Scantron answer sheet. 1 Warren Company plans to depreciate a new building using double- declining-balance depreciation. The building cost $800,000. The estimated residual value of the building is $50,000 and it has an expected useful life of 25 years. What is the building’s book value at the end of the second year? A) $736,000. B) $690,000. C) $677,120. D) $634,800. E) None of the above is correct. 2 Under the periodic inventory system: A) a transaction by transaction unit inventory record is maintained. B) the cost of goods sold for each sale is recorded at the time each sale is made. C) ending inventory and cost of goods sold are calculated at the end of each accounting period. D) a continuous inventory record provides the amount of ending inventory and the cost of goods sold throughout the period. E) none of the above is correct. 3 Which of the following is true? A) Using straight-line depreciation in comparison to an accelerated method will lead to lower earnings in the first year of an asset's life. B) Using accelerated depreciation in the first year of an asset's life will report a higher net profit margin compared to using straight-line. C) Using straight-line depreciation in comparison to an accelerated
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F10_Exam_2-Form_A - Exam #: Fundamentals of Financial...

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