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ACC Final Review

ACC Final Review - ACC151 M010 2011 SPRING Instructor...

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ACC151 M010 2011 SPRING Instructor: Xiaolu Xu Sample Final Exam (Review questions) Note: You can consider this document as either a sample final exam or a sheet for review questions. I made 57 multiple choice questions covering chapter 10-13 here for your practice and review. For chapter 1-9, please review all multiple choice questions in 2 sample midterms and 2 midterms. In the final exam, there will be 15 multiple choice questions and 4 long problems. I. MULTIPLE CHOICES ( correct answers are indicated by underscoring and bolding the corresponding letters ) 1. When a bond sells at a premium: A . The contract rate is above the market rate B . The contract rate is equal to the market rate C . The contract rate is below the market rate D . It means that the bond is a zero coupon bond E. The bond pays no interest 2. Promissory notes that require the issuer to make a series of payments consisting of both interest and principal are: A. Debentures B. Discounted notes C. Installment notes D. Indentures E. Investment notes 3. Installment notes payable that require periodic payments of accrued interest plus equal amounts of principal result in: A. Periodic total payments that gradually decrease in amount B. Periodic total payments that are equal C. Periodic total payments that gradually increase in amount D. Increasing amounts of interest each period E. Increasing amounts of principal each period 4. Which of the following statements is true? A. Interest on bonds is tax deductible B. Interest on bonds is not tax deductible C. Dividends to stockholders are tax deductible D. Bonds do not have to be repaid E. Bonds always decrease return on equity 5. A bond traded at 102 ½ means that:
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6. A company issued 8%, 15-year bonds with a par value of $550,000. The current market rate is 8%. The journal entry to record each semiannual interest payment is: 7. A discount on bonds payable:
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