136A_W07_MT2

136A_W07_MT2 - Anderson ECON 136A Midterm#2 v 1 Name THERE...

Info iconThis preview shows pages 1–3. Sign up to view the full content.

View Full Document Right Arrow Icon
February 28, 2007 Anderson ECON 136A Midterm #2 v. 1 Name _________________________ THERE IS A PROBLEM IN THIS EXAM WHICH REQUIRES THAT YOU COMPLETE IN THE SPACE PROVIDED. .. PLEASE BE SURE TO WRITE YOUR NAME ON THE EXAM AND TURN IT IN WITH YOUR BLUE-BOOK AND SCANTRON AT THE END OF CLASS. Complete questions 1-25 on scantron, and the problems in your blue-book unless specifically requested otherwise within the exam. 1. Which of the following is NOT considered cash for financial reporting purposes? a. Petty cash funds and change funds b. Money orders, certified checks, and personal checks c. Coin, currency, and available funds d. Postdated checks and I.O.U.'s 2. Which of the following is correct? a. Selling costs are product costs. b. Manufacturing overhead costs are product costs. c. Interest costs for routine inventories are product costs. d. All of these. 3. We buy an assortment of overstock items. We received 5,000 units of product A and 5,000 units of product B. The purchase price was not allocated between the two product types and we paid a total of $10,000 for both. We expect to sell product A for $2.00/ unit and product B for $1.00/ unit. What is the per unit cost under GAAP (when doing your computation, round to two decimals): a. $1.00/ unit for product A and B. b. $1.34/ unit for product A and $.66/ unit for product B. c. $2.00/ unit for product A and $0.00/ unit for product B. d. $1.50/ unit for product A and $.55/ unit for product B. 4. When using a perpetual inventory system, a. no Purchases account is used. b. a Cost of Goods Sold account is used. c. two entries are required to record a sale. d. all of these.
Background image of page 1

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
Midterm #2 v. 1--Page 2 5. XYZ, Inc. has properly applied their percentage of sales consistently all year in recording bad debt expenses. At the end of the year, they note that the allowance for doubtful accounts balance is $150,000. Management reviews the accounts receivable aging and notes that there are very old balances and other items which lead them to estimate that the allowance needs to be $225,000. Given these facts, which of the following statements is accurate: a. Management should adjust the percentage of sales to increase the allowance on future transactions, but do nothing to adjust the bad debt expense now; b. Management should report a restatement of $75,000; c. Management should do nothing as the additional expense could result in negative comments from financial analysts; d. Management should record an additional bad debt expense of $75,000, reflecting a change in their estimate. 6. XYZ, Inc. ships goods FOB destination point which are in transit at the end of the year. As of the end of the year, these items should be: a. Excluded from inventory. b.
Background image of page 2
Image of page 3
This is the end of the preview. Sign up to access the rest of the document.

Page1 / 18

136A_W07_MT2 - Anderson ECON 136A Midterm#2 v 1 Name THERE...

This preview shows document pages 1 - 3. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online