Exam 1A - Spring 20110001

Exam 1A - Spring 20110001 - )3 A 35 1 If assets do not...

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Unformatted text preview: )3; A +35 \ 1 If assets do not change and liabilities increase, owner’s equity must decrease. \ a True \ False 2L Which of the following statements is false? falf Accounts receivable typically has a debit balance b/fi" " Dividends typically have a debit balance L Vb)” C mmon stock typicall has a credit balance , @ Unearned revenue t pically has a debit bala ‘1" 2 x1) All of the above are true \ 3) Which of the following financial statements represents a firm’s financial position at a point in time? ® Balance Sheet b) Income Statement 0) Statement of Cash Flows d) None of the above e) More than one of the above Use the following options to answer questions 4-9: a) Assets increase, liabilities increase, owner’s equity no change b) Assets increase, liabilities no change, owner’s equity increase 0) Assets no change, liabilities no change, owner’s equity no change d) Assets decrease, liabilities no change, owner’s equity decrease e) None of the above What is the effect of each of the following transactions on the accounting equation? { A” 4) Olivia borrows $5000 from a bank ($6313 A’ I? .2- A Nora; PWNL ’ (L) 5) Kyle receives $600 from customers for services performed during the current accounting period (A) (”we ‘4 '1" % %«V\‘ CL Lax/Laue, 11‘ (Vugi/i (VA\1\ Wirsten collects $800 from customers for sales previouslyWmaflde‘o_n_acc_gunt;’ K Amp: at S - . . . . own»; E a «W» {x (‘7‘) (“E i (,4 ‘ “M 7&5er receives and pays a $300 ut111t1es bill C “(M A 4’ ( A) E; \/84j\Claire pays $1250 for inventory previously purchased on account flags” 1‘; Paymka 4; (C? I C— «.4, L‘ ‘4' 3 \%Olivia owes $2000 of previously unrecorded wages to employees “”3“ EKP- \1/ 1/95) W“3Lg PAYQBL’? {L3 Which of the following accounts would increase with a debit? Wage Expense Unearned Revenue . + ‘M W Retained Earnings WMV [aw/JR,“ a. gauww Equipment W/ fl to?» ‘ A and D both increase with a debit Kyle issues (sells) $3000 of common stock. Which of the following journal entries would he make to record this transaction? Dr. Common Stock 3000 Cr. Cash 3000 Dr. Accounts Receivable 3000 Cr. Common Stock 3000 Dr. Cash 3000 Cr. Retained Earnings 3000 Dr. Cash 3000 Cr. Common Stock 3000 None of the above Claire prepays 6 months worth of insurance at a cost of $300 per month. How would she record this transaction? Dr. Insurance Expense 1800 Cr. Cash 1800 Dr. Prepaid Insurance 300 Cr. Cash 300 Dr. Cash 1800 Cr. Insurance Revenue 1800 None of the above Olivia collects $1200 from customers for sales previously made on account. Her journal entry to record this transaction would include which of the following? A debit to accounts receivable for $1200 A credit to sales revenue for $1200 A debit to cash for $1200 More than one of the above Claire pays off $475 of previously recorded employee wages. Which of the following would not be part of the journal entry to record this transaction? A debit to wage expense of $475 A debit to wages payable of $47 5 A credit to cash of $475 SAW 15) Olivia’s cash account is as follows. Fill in the missing number. Cash $2,900 ’? $10,300 $3,600 a $9,600 62? $11,000 c) $3,800 (1) None of the above 16) Kyle has the following in his accounts receivable account at the end of an accounting period. What were Kyle’s total sales on account during the period? Accounts Receivable Beg. Bal. $1,300 \2’7 v6“ (312150) $11,200 /'\° ““ $2,650 a $1,400 $12,450 c) $11,200 at $2,650 $13,850 17) The following is taken from an unadjusted trial balance. Which of the following accounts is wrong? Dr. Cr. a) Cash 2800 b Equipment 3000 Notes Payable 4500 Service Revenue 8000 e) Rent Expense 900 18) What does it mean to post a journal entry to the general ledger? a) Record the journal entry 0 Make a closing entry Q3 Record the amounts from a journal entry in the associated t-accounts Record the amounts from a journal entry on the balance sheet The debits on a trial balance must equal the credits on a trial balance. True V False ”0 v v 22) Which of the following is not one of the primary financial statements? Auditor’s Report ' Income Statement Balance Sheet Statement of Cash Flows Statement of Stockholder’s Equity Which of the following could not be an adjusting entry? Dr. Utilities Expense Cr. Utilities Payable Dr. Unearned Revenue Cr. Sales Revenue Dr. Depreciation Expense Cr. Accumulated Depreciation Dr. Supplies Cr. Cash The adjusting entry to record an accrued expense typically follows which of the following formats? Dr. Expense Cr. Payable Dr. Expense Cr. Prepaid Asset Dr. Retained Earnings Cr. Expense Dr. Unearned Revenue Cr. Revenue ”aw” . . /. . . Closmg entrles involve which of the followmg. Debits to all revenue accounts Credits to all expense accounts .\_ . r j E rr A (A . . 1 Q. ‘ ‘ I a S S » Debits to the d1v1dend account MM E ‘ *0 «M / All of the above Enamels“ ' A and B Mike sells magazines. His customers pay him $12 at the beginning of the year for 12 issues (one each month). He has 2,000 subscribers. What adjusting entry would he make on March 31 to record the delivery of the first three issues to his subscribers (ignore any costs associated with delivering the magazines)? Dr. Cash 6,000 Cr. Subscription Revenue 6,000 Dr. Cash 6,000 Cr. Unearned Revenue 6,000 Dr. Unearned Revenue 6,000 Cr. Subscription Revenue 6,000 None of the above 25) Olivia borrows $12,000 from a bank on September 1, 2012. She must make interest payments on August 31 of each subsequent year (beginning in 2013). The interest rate on the loan is 6%. Olivia must pay off the $12,000 principal on August 31, 2017. What adjusting entry would she make on December 31, 2012 in relation to this loan? Dr. Interest Expense 180 Cr. Interest Payable 180 Dr. Interest Expense 240 Cr. Cash 240 Dr. Interest Payable 180 Cr. Interest Expense 180 None of the above Which type-of journal entry is made last in any given accounting period? Original Entries Closing Entries Adjusting Entries None of these types of journal entries is necessarily made before or after the others Which financial statement contains a reconciliation of beginning and ending cash balances? Balance Sheet Statement of Cash Flows Income Statement Which of the following balance sheet accounts will likely have a different balance on the post—closing trial balance than on the adjusted trial balance? Interest Expense Cash Retained Earnings Accounts Payable Any of the above could have a different balance on the post-closing trial balance than on the adjusted trial balance The following journal entry is what type of journal entry? Dr. Sales Revenue 20,000 Cr. Retained Earnings 20,000 Adjusting entry Original entry Closing entry What is the proper way to treat a deposit in transit when preparing a bank reconciliation? Adjust the company’s cash balance Adjust the bank’s cash balance Adjust both cash balances A deposit in transit would not be included on a bank reconciliation Which acronym below is used to describe the accounting rules that companies must follow in preparing their financial statements for external users? GAAP FASB SEC SOX GAAS Claire gives you the following information: Cash balance per accounting records: $1,950 Checks outstanding: $350 NSF Checks: $13 0 Interest received from bank: $15 Fees paid to bank: $10 Error in recording rent payment on check 1541; recorded $350 rather than $450 Deposits in transit: $420 What should be the balance in Claire’s cash account after preparing a bank reconciliation and all related journal entries? $1,795 - 0 $1,925 i 61 5 $1,935 ( i 10 \ $1,725 I 6— None of the above (\ a ’3 A cowboy should never: C \ O 03 Wear crimson ' Speak Bob Stoops name I 7 {36; Kiss a sooner All of the above ...
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