W05 8am mt1

W05 8am mt1 - January 31, 2005 Anderson Econ 136A 8:00...

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January 31, 2005 Anderson Econ 136A 8:00 class Midterm #1 Name _________________________ Write your name and perm number on your green scantron and your blue- book. Complete the multiple choice on your green scantron and the problems in the blue book. WRITE YOUR NAME ON THIS EXAM AND TURN IT IN WITH YOUR SCANTRON AND BLUE- BOOK. ------------------------- Complete on your green scantron. 1. Another term for the balance sheet is: a. Statement of sources and uses of cash b. Statement of activity for the period c. Statement of financial position d. I have no idea 2. Under accounting principles generally accepted in the United States of America, which of the following statements are true: a. Revenue is recorded when the payment has been received and expenses are recorded when paid. b. Revenue is recorded when it has been earned and expenses when the associated benefit has been received. c. Revenue is recorded when the expense for the revenue has been paid. d. Revenue is recorded when estimable by the Company's management and expenses are recorded when it is reasonably determined. 3. Which of the following is a recordable event or item? a. Changes in managerial policy b. The value of human resources c. Changes in personnel d. None of these 4. Under the cash basis of accounting, revenues are recorded a. when they are earned and realized. b. when they are earned and realizable. c. when they are earned. d. when they are realized. 5. When converting from cash basis to accrual basis accounting, which of the following adjustments should be made to cash receipts from customers to determine accrual basis service revenue? a. Subtract ending accounts receivable. b. Subtract beginning unearned service revenue. c. Add ending accounts receivable. d. Add cash sales.
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Midterm #1--Page 2 6. Adjusting entries are necessary to 1. obtain a proper matching of revenue and expense. 2. achieve an accurate statement of assets and equities. 3. adjust assets and liabilities to their fair market value. a. 1 b. 2 c. 3 d. 1 and 2 7. When an item of expense is paid and recorded in advance, it is normally called a(n) a. prepaid expense. b. accrued expense. c. estimated expense. d. cash expense. 8. Which of the following statements is true about unrealized gains and losses on available for sale securities. a. They should be reflected on the income statement. b. They should be ignored as available for sale securities are presented at cost. c. They should be reflected as a component of other comprehensive income in the statement of stockholder's equity. d. They should be reflected as a component of other comprehensive income, which is a component of net income. 9. If there is a change in accounting estimate which would have resulted in an additional charge to a prior year expense, which of the following statements is true: a. It should be reflected as a correction of an error in the statement of stockholder's equity, net of tax and captioned "restatement". b.
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This note was uploaded on 05/18/2011 for the course ECON 136A taught by Professor Anderson during the Spring '08 term at UCSB.

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W05 8am mt1 - January 31, 2005 Anderson Econ 136A 8:00...

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