(ACCT101)[2009](f)quiz~cswongab^_10004

(ACCT101[2009(f)qu - B ACCT101 Introduction to Accounting for Business Majors Quiz II Fall 2009 Name Student ID Section No Instructions This is a

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1 ACCT101: Introduction to Accounting for Business Majors Quiz II, Fall 2009 N a m e : Student ID: S e c t i o n N o : Instructions: This is a closed book quiz. It consists of 22 questions. Please write your name, student ID, lecture section number on this page. Write your answers clearly on the answer sheets. Only answers on the answer sheets will be graded. You need to hand in all pages of the quiz. You will get zero score if any page of your quiz is missing. Please do not discuss with anyone else about the quiz before 3pm, November 24 th , 2009. B
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Part I: Multiple-choice questions. 1. Lenovo paid $2,000,000 to purchase all of Thinkpad’s assets and assumed liabilities of $400,000. The acquired assets were appraised at a fair value of $1,800,000. What amount of goodwill should be recorded on Lenovo’s book? A. $200,000. B. $400,000. C. $600,000. D. $800,000. 2. Which of the following is true ? A. Using straight-line depreciation in comparison to an accelerated method will lead to a lower earnings per share in the first year of an asset's life. B. Using accelerated depreciation in the first year of an asset's life will report a higher net profit margin compared to using straight-line. C. Using accelerated depreciation will lead to a higher total asset turnover in the first year. D. Using straight-line depreciation in comparison to an accelerated method will lead to a higher current ratio in the first year of an asset's life. 3. If Southwest Airlines determines that an asset has been impaired by $2 million then which of the following will occur at the end of the current accounting period? A. No action will be taken to recognize its impairment until the asset is sold. B. The impairment will not affect the accounts but will be disclosed in the footnotes. C. A debit to retained earnings will be recorded for the effect of the loss thereby bypassing the income statement. D. A credit to the asset's account will be recorded for the amount of the loss. 4. Amanda Company purchased a computer that cost $10,000. It had an estimated useful life of five years and residual value of $0. The computer was depreciated by the straight-line method and was sold at the end of the fourth year of use for $3,000 cash. Amanda Company should record A. a gain of $1,000. B. a loss of $1,000. C. neither a gain nor a loss - the computer was sold at its book value. D. neither a gain nor a loss- the gain that occurred in this case would not be recognized. 5. On March 1, 2009, Anniston Company purchased a producing oil well at a cash cost of $1,000,000. It is estimated that 1,500,000 barrels of oil can be produced over the remaining life of the well. By December 31, 2009 (end of the accounting period), 150,000 barrels of oil were produced and sold. The amount of depletion for 2009 on this well that should be added to oil inventory would be A. $100,000. B. $125,000.
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This note was uploaded on 03/01/2012 for the course ACCT 101 taught by Professor Acbsadf during the Spring '12 term at Minnesota.

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(ACCT101[2009(f)qu - B ACCT101 Introduction to Accounting for Business Majors Quiz II Fall 2009 Name Student ID Section No Instructions This is a

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