SAM2f07 - BACC 3110 Intermediate I Exam II Sample Exam Fall...

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BACC 3110 – Intermediate I Exam II Sample Exam – Fall 2007 Multiple Choice and Short Answer 1. Bentley Company had the following bank reconciliation at March 31, 2007: Balance per bank statement, 3/31/07 $23,250 Add: Deposit in transit 5,150 $28,400 Less: Outstanding checks (6,300 ) Balance per books, 3/31/07 $22,100 Data per the bank for the month of April 2007 follows: Deposits $29,200 Disbursements 24,850 All reconciling items at March 31, 2007, cleared through the bank in April. Outstanding checks at April 30, 2007, totaled $3,500. What is the balance of cash per books at April 30, 2007? a. $31,100 b. $26,450 c. $24,100 d. $22,950 2. Your cashier has notified you that he has misplaced all the bank statements for the past year. You decide to review selected accounting records during the year and discover that the following journal entry was made to reconcile the June 30, 2007 bank statement and the accounting records: Accounts receivable $1,520 Service Charges 13 Notes Receivable 200 Interest Revenue 10 Cash 1,323 Assume that the preadjustment balance in the cash account was $7,684, outstanding checks at June 30 were $208, and no other adjustments were required in preparing the bank reconciliation. What was the preadjustment balance per bank at June 30, 2007? a. $6,361 b. $6,569 c. $6,153 d. $7,892 3. Mikel Co. has determined its December 31, 2008, inventory on a FIFO basis to be $400,000. Information pertaining to that inventory follows: Estimated selling price $408,000 Estimated cost of disposal 20,000 Normal profit margin 60,000 Current replacement cost 320,000 Mikel records losses that result from applying the lower of cost or market rule. At December 31, 2008, what should be the net carrying value of Mikel’s inventory? a. $400,000 b. $388,000 c. $360,000 d. $328,000 1
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4. During 2008, a construction company changed from the completed-contract method to the percentage-of- completion method for accounting purposes but not for tax purposes. Gross profit figures under both methods for the past three years appear below: Completed-Contract Percentage-of-Completion 2006 $ 475,000 $ 800,000 2007 625,000 950,000 2008 700,000 1,050,000 $1,800,000 $2,800,000 Assuming an income tax rate of 40% for all years, the affect of this accounting change on prior periods should be reported by an increase of a. $600,000 on the 2008 income statement. b. $390,000 on the 2008 income statement. c. $600,000 on the 2008 retained earnings statement. d. $390,000 on the 2008 retained earnings statement. USE THE FOLLOWING INFORMATION TO ANSWER THE NEXT THREE (3) QUESTIONS: During January 2007, Excalibur Corporation, which maintains a perpetual inventory system, recorded the following information pertaining to its inventory: Unit Total Units Cost Cost Balance on 1/1/07 1,000 $1 $1,000 Purchased on 1/7/07 600 3 1,800 Sold on 1/20/07 900 Purchased on 1/25/07 400 5 2,000 5. Under the moving-average method, what amount should Excalibur report as Inventory at January 31, 2007? a.
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SAM2f07 - BACC 3110 Intermediate I Exam II Sample Exam Fall...

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