Question<\/p>\n
1. Question : An entity that is organized according to state or federal statutes and in which ownership is divided into shares of stock is a<\/p>\n
Student Answer: proprietorship.<\/p>\n
corporation.<\/p>\n
partnership.<\/p>\n
governmental unit. A<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
2. Question : When a product is sold, this cost is often called<\/p>\n
Student Answer: cost of goods sold.<\/p>\n
revenue.<\/p>\n
products.<\/p>\n
retained earnings.<\/p>\n
Comments:<\/p>\n
3. Question : Which of the following are business stakeholders?<\/p>\n
Student Answer: Stockholders<\/p>\n
Suppliers<\/p>\n
Customers<\/p>\n
All of these<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
4. Question : The role of accounting in business is best defined as<\/p>\n
Student Answer: an information system that provides reports to stakeholders about the economic activities and condition of a business. <\/p>\n
a method of forecasting the future profitability of a company.<\/p>\n
the policies, procedures, and strategies used in a business.<\/p>\n
transaction analysis.<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
5. Question : The following are examples of internal stakeholders EXCEPT:<\/p>\n
Student Answer: managers.<\/p>\n
creditors.<\/p>\n
employees.<\/p>\n
All of these are internal stakeholders.<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
6. Question : Costs incurred in operating a business are also known as<\/p>\n
Student Answer: revenues.<\/p>\n
expenses.<\/p>\n
liabilities.<\/p>\n
dividends.<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
7. Question : More than 70% of businesses are organized as what type of business?<\/p>\n
Student Answer: Community Not-for-profit<\/p>\n
Corporation<\/p>\n
General Partnership<\/p>\n
Sole proprietorship<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
8. Question : Which of the following must receive IRS permission AND is reportable in the financial records?<\/p>\n
Student Answer: The value of goodwill earned through business operations<\/p>\n
The value of human resources<\/p>\n
Changes in personnel<\/p>\n
Changes in inventory costing methods<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
9. Question : A chart of accounts is a<\/p>\n
Student Answer: subsidiary ledger.<\/p>\n
listing of all account titles.<\/p>\n
general ledger.<\/p>\n
general journal.<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
10. Question : The last step in the accounting cycle is to<\/p>\n
Student Answer: prepare a post-closing trial balance.<\/p>\n
journalize and post-closing entries.<\/p>\n
prepare financial statements.<\/p>\n
journalize and post adjusting entries.<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
11. Question : Under the cash basis of accounting,<\/p>\n
Student Answer: revenues are recorded when they are earned.<\/p>\n
accounts receivable would appear on the balance sheet.<\/p>\n
depreciation of assets having an economic life of more than one year is recognized. <\/p>\n
the matching principle is ignored.<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
12. Question : The basic financial statements are listed below:<\/p>\n
(1) Balance sheet<\/p>\n
(2) Statement of retained earnings<\/p>\n
(3) Income statement<\/p>\n
(4) Statement of cash flows<\/p>\n
In which of the following sequences does the accountant ordinarily prepare the statements?<\/p>\n
Student Answer: 1, 4, 3, 2<\/p>\n
2, 1, 3, 4<\/p>\n
3, 2, 1, 4<\/p>\n
3, 2, 4, 1<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
13. Question : If an inventory account is understated at year end, the effect will be to overstate the<\/p>\n
Student Answer: net purchases.<\/p>\n
gross margin.<\/p>\n
cost of goods available for sale.<\/p>\n
cost of goods sold.<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
14. Question : An adjusting entry will not take the format of which one of the following entries?<\/p>\n
Student Answer: A debit to an expense account and a credit to an asset account<\/p>\n
A debit to an expense account and a credit to a revenue account<\/p>\n
A debit to an asset account and a credit to a revenue account<\/p>\n
A debit to a liability account and a credit to a revenue account<\/p>\n
Comments:<\/p>\n
15. Question : Sky Company collected $12,350 in interest during 2013. Sky showed $1,850 in interest receivable on its December 31, 2013, balance sheet and $5,300 on December 31, 2012. The interest revenue on the income statement for 2013 was<\/p>\n
Student Answer: $3,450.<\/p>\n
$8,900.<\/p>\n
$12,350.<\/p>\n
$14,200.<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
16. Question : On August 1 of the current year, Kyle Company borrowed $278,000 from the local bank. The loan was for 12 months at 9 percent interest payable at the maturity date. The adjusting entry at the end of the fiscal year relating to this obligation would include a<\/p>\n
Student Answer: debit to interest expense of $25,020.<\/p>\n
debit to interest expense of $10,425.<\/p>\n
credit to note payable of $10,425.<\/p>\n
debit to interest receivable of $10,425.<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
17. Question : Which of the following criteria must be met before recording an accounting event?<\/p>\n
Student Answer: The event must be an arm’s-length transaction.<\/p>\n
The event must be repeatable in a future period.<\/p>\n
The event must be measurable in financial terms.<\/p>\n
The event must be disclosed in the reported footnotes.<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
18. Question : How would proceeds received in advance from the sale of nonrefundable tickets for the Super Bowl be reported in the seller\u2019s financial statements published before the Super Bowl?<\/p>\n
Student Answer: Revenue for the entire proceeds.<\/p>\n
Revenue less related costs.<\/p>\n
Unearned revenue less related costs.<\/p>\n
Unearned revenue for the entire proceeds.<\/p>\n
Points Received: 0 of 2 <\/p>\n
Comments:<\/p>\n
19. Question : The Supplies on Hand account balance at the beginning of the period was $6,600. Supplies totaling $12,825 were purchased during the period and debited to Supplies on Hand. A physical count shows $3,825 of Supplies on Hand at the end of the period. The proper journal entry at the end of the period<\/p>\n
Student Answer: debits Supplies on Hand and credits Supplies Expense for $9,000.<\/p>\n
debits Supplies Expense and credits Supplies on Hand for $12,825.<\/p>\n
debits Supplies on Hand and credits Supplies Expense for $15,600.<\/p>\n
debits Supplies Expense and credits Supplies on Hand for $15,600.<\/p>\n
Comments:<\/p>\n
20. Question : The inventory turnover ratio<\/p>\n
Student Answer: measures management\u2019s ability to productively employ all of its resources. <\/p>\n
measures the efficient use of assets held for resale.<\/p>\n
is a stringent measure of liquidity.<\/p>\n
provides a measure of the strength of the sales mix the company currently employs.<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
21. Question : Statements in which all items are expressed only in relative terms (percentages of a common base) are<\/p>\n
Student Answer: horizontal statements.<\/p>\n
percentage statements.<\/p>\n
vertical statements.<\/p>\n
common-size statements.<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
22. Question : Which of the following ratios does NOT measure efficiency or activity of an entity?<\/p>\n
Student Answer: Accounts receivable turnover<\/p>\n
Age of accounts receivable<\/p>\n
Net cash flow to current liabilities<\/p>\n
Times interest earned<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
23. Question : The percent of fixed assets to total assets is an example of<\/p>\n
Student Answer: vertical analysis.<\/p>\n
solvency analysis.<\/p>\n
profitability analysis.<\/p>\n
horizontal analysis.<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
24. Question : Which of the following is included in the computation of the quick ratio?<\/p>\n
Student Answer: Prepaid rent<\/p>\n
Accounts receivable<\/p>\n
Inventory<\/p>\n
Supplies<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n
25. Question : Which of the following ratios would not be affected by the choice of depreciation methods?<\/p>\n
Student Answer: Working capital turnover<\/p>\n
Earnings per share of common stock<\/p>\n
Debt to equity<\/p>\n
Price-earnings ratio<\/p>\n
Points Received: 2 of 2 <\/p>\n
Comments:<\/p>\n","protected":false},"excerpt":{"rendered":"
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