Examination_2A_2006_solution - University of Washington...

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University of Washington – School of Business ACCTG 301 – Intermediate Accounting I Widdison, Summer 2006 Examination #2A NAME : ___ SOLUTION ____ SUGGESTED TIME ALLOCATIONS FOR EACH PART OF THE EXAM ARE INDICATED IN THE TABLE BELOW. Points per Part Points Earned Part I. Miscellaneous Multiple Choice (30 minutes) 45 Part II. Financial Reporting Essay (15 minutes) 15 Part III Financial Reporting Problem (15 minutes) 18 Part IV Revenue Recognition Problem (25 minutes) 22 Total points for all parts. 100 Notes: This exam package contains 10 pages, including this page. Please check immediately that you have a complete package. Demonstration of your work in computational multiple-choice questions will not be considered in grading your paper. Essays are to be presented in good form (i.e. complete sentences, clear language, etc.) and confined to the space provided. This exam is a closed-note, closed-book, and closed-“contact with other people” exam. The work you do must be the results of your own legitimate efforts. You may not consult any kind of resource for assistance. Please sign in the space below to indicate that you understand this and will conduct yourself ethically and with integrity in this exam. ____________________________________ Student Signature Acctg 301, Summer 2006 – Widdison. Examination 2A Page 1 of 10 pages.
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PART 1. Miscellaneous Multiple Choice. Please select the best answer from the options provided. (3 points each question; 45 total) 1. The balance sheet contributes to financial reporting by providing a basis for all of the following except a. computing rates of return. b. evaluating the capital structure of the enterprise. c. determining the increase in cash due to operations. d. assessing the liquidity and financial flexibility of the enterprise. 2. The basis for classifying assets as current or noncurrent is the period of time normally required by the accounting entity to convert cash invested in a. inventory back into cash, or 12 months, whichever is shorter. b. receivables back into cash, or 12 months, whichever is longer. c. tangible fixed assets back into cash, or 12 months, whichever is longer. d. inventory back into cash, or 12 months, whichever is longer. 3. Joe Novak Corporation reports the following information: Net cash provided by operating activities $215,000 Average current liabilities 150,000 Average long-term liabilities 100,000 Dividends paid 60,000 Capital expenditures 110,000 Payments of debt 35,000 Based on current thinking, what is the best estimation of Joe Novak’s free cash flows? a. $10,000. b. $45,000. CFOPS of $215 less capital expenditures of 110 c. $105,000. and dividends of 60. d. $155,000. 4.
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Examination_2A_2006_solution - University of Washington...

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