BMGT 220 Exam 1 - Spring 2011

BMGT 220 Exam 1 - Spring 2011 - BMGT 220 EXAMINATION 1...

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February 24, 2011 PRINT YOUR NAME:_____________________________________________________ Important: Bubble in your responses in the spaces provided next to each question on the Scantron sheet. MULTIPLE CHOICE QUESTIONS: Identify the letter of the choice (A,B,C or D) that best completes the statement or answers the question, and darken the corresponding on the Scantron sheet. ____ 1. Which one of the following groups is considered an internal user of financial statements? A. A bank reviewing a loan application from a corporation. B. The labor union representing employees of a company that is involved in labor negotiations C. The financial analysts for a brokerage firm who are preparing recommendations the firm’s brokers on companies in a certain industry D. Factory managers that supervise production line workers. ____ 2. Peerless Corporation purchased land in 2000 for $150,000. In 2010, it purchased a nearly identical parcel of land for $350,000. In its 2010 balance sheet, Peerless valued these two parcels of land at a combined value of $700,000. Reporting the land in this manner violated the: A. Cost principle B. Fair Value Principle C. Monetary Unit Asumption D. Economic Entity Assumption ____ 3. Common Stock, as shown in the balance sheet of a corporation, always represents: A. The amount invested in the business by stockholders when shares of stock were initially issued by a corporation. B. The total owners' equity for a business organized as a corporation. C. The owners' equity accumulated through profitable operations that has not been paid out as dividends. D. Price paid by corporation to purchase shares of stock in the corporation from other stockholders. ____ 4. A transaction caused a $55,000 increase in both assets and total liabilities. This transaction could have been: A. Purchase for office equipment for $55,000 cash. B. Purchase of office equipment for $120,000, paying $65,000 cash and issuing a note payable for the balance. C. Repayment of a $55,000 bank loan. D. Investment of $55,000 cash in the business by the owner ____ 5. As of December 31, 2010, the Balance Sheet of Sparkling Products, Inc. contain the following items (in random order): Accounts Payable $6,000 Land 45,000 Building 125,000 Notes Payable 67,500 Accounts Receivable 15,000 Cash 3,500 Retained Earnings 50,000 Common Stock 94,000 Equipment ? Determine the amount of Equipment.
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BMGT 220 Exam 1 - Spring 2011 - BMGT 220 EXAMINATION 1...

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