Final Practice set 2

Final Practice set 2 - Exam 2, Set B Practice Questions...

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Unformatted text preview: Exam 2, Set B Practice Questions These questions are provided to: 1. Give you a chance to test your knowledge. so that you can focus your efforts on your weakest areas. 2. Give you actdiiional practice. 3. Let you see some possible ways in which E can sel up multiple choice iype problems. 4. Give you an idea as to the type and level ofmaterinl that l generally choose for testing. This is NOT a study guide. Your test will likely be different both in specifics and construction. You need to understand the rules, not memorize the results. For most questions, your best strategy is to clothe problem like it was a non-multiple choice homework problem. Do not "shop" the choices, you‘ll find it reason to choose each one and end up con fused. ORLLN QUQSM 9* 5f) Page 1 of8 For the questicns on this page, label each ofthe transactions according t0 its impact on net income and cash, using the choices ibetow. Assume that the trmtsactioas eccurrett En Octebcr . and the company prepares tnmttitiy fittattcini statements. 10, H. Cash u Net luccme No effect increase Increase No effect Increase No effect Decrease Said a cahinet and received $500. {The cabinet was purchased 3 years age For $1.000. m the {tags 01‘ sale. accumulated depreciation 0n the desk was $600) Sold a desk and received 3200. {The desk was purchased 2 years ago for S I .100. At the date at" sate. accumulated depreciation en the desk was $800) Sold some equipment for cash. The sates price equaled the net beck vaitte ot'ttte equipment. $>k$¥fi$<$$fi=tk$***#*$$$**$*$*5:****$$*$$$*$¥*$**$$3*$$$**fiifitfiktktktkatfiflhkmfiwfltfiiatfii**$$*$$*$**$* For the questions on this page. label each (tithe transactions according to its impact on net inemne anti cash. using the choices heEcw. Assume that the transactions occurred in October. and the ctmtpzmy prepares monthly financial statemeats. Cash . : 3}Lsttas_euw .___ No effect Decrease No effect Decrease No transaction g No effect Decrease D. 12. Paid $4890 to reptaee an engine in a detivery van. t3. Had a tune—up on another van for $250. Witt pay the bit] in Noxte-tttcer M. Paid $400 in shaming for the detivery ct‘seme equipment Page 4 of8 WMWWWW Use the fotlowéng information to answer the next 5 questions. jasper, Inc. purchased a computer systettt For $8,000 on January 1, 2003. The estimated useful life ofthe system is 5 years, and there is no residual value. Jasper estimated that the system will provide 25,000 hours ofservéee. in 2003, the computer system was used for 4.00!) hours. Jasper has a December 31 year—end. E3. Assume Jasper uses the straiglthlioe method of depreciation. E-low much depreciation expense wllE Jasper report for the year ended December 3 I. 2003? A. $8,900 B. $4,900 C. $1,600 D. $800 None ot‘tlae above l6. Assume Jasper uses the straight—line method oi‘depr-eciation. What is the net book value ol'the computer system at December 3 t. 2004 (two years after it was purchased}? A. S I .600 B. 533,300 C. $4.800 D. 36,400 E. None of the above E7. Assume Jasper uses the double—declining balance method of depreciation. How much depreciation expense wili Jasper report for the year ended December 3 i. 2003? A. $3,200 8. 5 £609 C. 3800 E). none of the above l8. Assume jasper uses the double—declining balance method of depreciation. How much depreciation expense will fiasper report for the year ended December 3 l . 200-1? A. $ LQSU B. $ L600 C. $ l,920 D. $3.200 1‘). Assume Jasper uses the anits-oilprodaetion method ol'depreeiatioo. How much depreciation expense will Jasper report for the year ended December 31. 2003'? A. $1,280 B. $1,500 C. 33,200 D. $4,000 20. Eifis industries purchased property or: July 1. 2003. The cost was aiiocated $80,000 to the land and $240,000 to the building. Assuming an estimated useful life onG years, how much depreciation expense should be recorded For the property for the year ended Decetttber 3 l, 2003. Assume Eltis uses the straight—line method and there is no residual value for the property. A. $6.000 E3. $8.000 C. $2,000 D. Stfififli) Page 5 of8 i a s i i s i a s 5 a s t i i t i i i Exam 28 Soiutéons to Practice Questions 30. E 351‘ ECLC tS.C 9.13 37. A 12. D 20. A .l3.-C‘ 3413 [9.91 We; k for Some oflhe Soiutions Freelo / income Slaiemcu! / Forth ’car cmled E313 i598 Statement oE‘Remined [Earnygis/ Sales \\ 10.000 Fer the year ended [31:31:98 COGS x W Beginning, Baiancc /" 3.:50 Gross Margin \x 5.206 Net Iricome I// 3,400 Dividend /// Liam Tax expense \ 890 Ending Bzfignfée 61,9323 Depreciation expense xxx 3mg /,/ 101211 expenses (J/r' / Ne: income ‘r/f/ Xxx // Freelo \‘»‘_ ,r/ Balance Sheet KKK // l 2!?) U98 Asset // Liuhiiigfigis 3 Cash / 2,080 Bzmk Leak‘x i560 § MR _ 31m Tami Liabifii‘ig Envemory 550 Xxx Equipfiifém 6,300 Equity XXX Lyé’g accumulated 11393)") Contributed capital xxx 3.600 “gepreciaiion xxx Any/Total asscxs ELLE Rammed earnings I! Team! Equity g sax ; Tam! L&E 111451} ...
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This note was uploaded on 03/12/2012 for the course ACCT 221 taught by Professor Catherinewest during the Spring '06 term at UMass (Amherst).

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Final Practice set 2 - Exam 2, Set B Practice Questions...

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