ACC231 - Fall 2010 Exam 2A KEY

ACC231 Fall 2010 - ACC231-FALL 2010-Exam 2(Version A NAME KEY READ THESE DIRECTIONS 1 Write your Name and breakout information above 2 On the

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PINK - Page 1 of 12 ACC231-FALL 2010-Exam 2 (Version A) NAME: KEY READ THESE DIRECTIONS! 1. Write your Name and breakout information above. 2. On the Scantron, write your LAST NAME, FIRST NAME AND ASU ID NUMBER (All Left Justified). You must also write “ PINK ” above your last name. These MUST be on your scantron to get credit for multiple choice! 3. Make sure you have ELEVEN single-sided pages in this exam. 4. Don’t start the exam until instructed to do so. 5. We will ONLY count items marked on the Scantron. 6. Cheating on any part of this exam will result in a failing grade for the course. 7. You have approximately 90 minutes for the exam. Work quickly, but do not rush. Budget your time carefully . At the conclusion of the exam period, exams must be turned in promptly. Formulas and accompanying Financial Statements are on the SEPARATE HANDOUT. Note that all interest percentages are ANNUAL percentages (e.g. 9% means 9% per year). YOU MUST RETURN THIS EXAM, THE SEPARATE HANDOUT AND THE SCANTRON. Each Multiple Choice Question is worth FIVE Points. Est. Time Topic Points Possible 75 min. 40 Multiple Choice Questions (plus 2 bonus questions) 200 points for the exam plus 10 extra Credit Points 90 min. TOTAL POSSIBLE 210 points G ood Luck!
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PINK - Page 2 of 12 _ C ___ 1. If a company’s gross profit ratio changed from 42% in 2009 to 47% in 2010, which of the statements below would best describe the trend? a. Trends cannot be determined unless the dollar amount of the change is provided b. It would depend on whether net sales increased or decreased during the period c. A positive trend d. A negative trend Higher numbers are positive for gross profit ratio. _ C __ 2. Pfizer spends $10,000 for research and development expenditures on a new drug. They will credit cash and debit: a. a fixed asset account b. an intangible asset account c. an expense account d. a prepaid expense account Internally developed intangible assets (such as R&D) are expensed and not capitalized. _ E __ 3. A Company purchases goods and is responsible for paying the freight (shipping charges). They pay the shipping company directly (credit to cash). The debit for this transaction is a debit to: a. Sales Revenue b. Delivery Expense c. Purchase Returns and Allowances d. Cost of Goods Sold e. Inventory Freight-In on purchases of inventory increase the cost of inventory (this was part of your homework). _ B __ 4. On January 1, 2010, Gusteau's Restaurant purchased equipment at a cost of $10,000. The equipment had an estimated useful life of 4 years at 2,000 hours per year or a total of 8,000 hours. The equipment’s estimated salvage value was $2,000. The equipment was used 2,100 hours in 2010. Using the units-of-production method, the depreciation expense for the year ending December 31, 2010, would be a. $2,000 b. $2,100 c. $2,500 d. $2,625 Depreciation rate: [($10,000 – $2,000) ÷ 8,000] = $1 per hour Depreciation expense: $1 per hour X 2,100 hours = $2,100
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This note was uploaded on 06/16/2011 for the course ACC 241 taught by Professor Karengeiger during the Spring '08 term at ASU.

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ACC231 Fall 2010 - ACC231-FALL 2010-Exam 2(Version A NAME KEY READ THESE DIRECTIONS 1 Write your Name and breakout information above 2 On the

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