Sample 201 3 by HC111111014625

VIEWS: 41 PAGES: 11

									Busa 3112                       Student Name_______________________________
Summer, 2002    Sample Test     Professor Greg Kordecki

Use the information below to answer the following questions.

The following information pertains to The Okula Corporation:

     1. The corporation's Store Supplies account showed a beginning
        debit balance of $200 and supplies purchased of $800. There was
        $300 of supplies on hand at year end.
     2. Depreciation on a building is estimated to be $5,000.
     3. A one-year insurance policy was purchased for $2,000. Three
        months have passed since the purchase.
     4. Accrued interest on a note receivable amounted to $100.
     5. The company received a $3,600 advance payment during the year on
        services to be performed. By the end of the year, one-fourth of
        the services had been performed.

1.    The adjusting entry to record the amount of service revenue earned during
      the period would include a
      a. debit to Earned Revenue for $2,700.
      b. debit to Unearned Revenue for $2,700.
      c. debit to Unearned Revenue for $900.
      d. credit to Unearned Revenue for $900.

2.    Which of the following pairs of accounts could not be included in the same
      adjusting entry?
      a. Wages Expense and Wages Payable
      b. Rent Expense and Rent Payable
      c. Unearned Revenue and Revenue from Services
      d. Interest Expense and Interest Receivable

3.    Which of the following accounts has a normal debit balance?
      a. Unearned Art Fees
      b. Art Fees Earned
      c. Mortgage Payable
      d. Unexpired Insurance

4.    The purchase of an asset for cash
      a. leaves total assets unchanged.
      b. increases assets and liabilities.
      c. increases assets and stockholders' equity.
      d. decreases assets and increases liabilities.

5.    Which of the following accounts most likely would be found on both a trial
      balance and an adjusted trial balance?
      a. Utilities Expense
      b. Supplies Expense
      c. Insurance Expense
      d. Depreciation Expense




                                                                               1
6.    Which of the following gives the correct sequence of accounting procedures?
      a. Ledger, trial balance, journal, financial statements
      b. Journal, ledger, trial balance, financial statements
      c. Financial statements, trial balance, ledger, journal
      d. Financial statements, journal, ledger, trial balance

7.    Stockholders' equity of a corporation would not show
      a. revenues and expenses.
      b. additional paid-in capital on stock issued.
      c. the par value of stock issued.
      d. retained earnings.

Use the following information to answer the questions below.

Maxx Realty Corporation had the following balance sheet accounts and balances:

     Accounts Payable           $6,000    Common Stock                    ?
     Accounts Receivable         1,000    Equipment                   $7,000
     Building                       ?     Land                         7,000
     Cash                        3,000    Retaining Earnings           2,000

8.    If   the balance of the Building account were $17,000, what would be the total
      of   liabilities and stockholders' equity?
      a.   $32,000
      b.   $27,000
      c.   $17,000
      d.   $35,000

9.    A company   that receives money in advance of performing a service
      a. debits   Cash and credits Unearned Fees.
      b. debits   Unearned Fees and credits Accounts Payable.
      c. debits   Cash and credits Prepaid Fees.
      d. debits   Cash and credits Accounts Receivable.

10. Which of the following events does not result in the recording of an expense?
    a. Payment of a dividend
    b. Payment of wages
    c. Receipt of a bill from the telephone company
    d. Purchase of gasoline for fill-up of a company car

11. Which of the following accounts probably would need to be adjusted at year
    end?
    a. Supplies
    b. Land
    c. Dividends
    d. Notes Payable




                                                                                   2
12. The Post. Ref. column in the general ledger shows that an amount has been
    posted when which of the following is placed in it?
    a. The journal page number
    b. A check mark
    c. An X
    d. The account number

13. Which of the following transactions will not result in an increase in
    revenues?
    a. Sale of stock to investors for cash
    b. Sale of goods on credit
    c. Accumulation of interest in bank account
    d. Sale of services for cash

14. Which of the following is an example of a deferral?
    a. Legal fees earned but not yet collected
    b. Income taxes recorded but not yet paid
    c. The accumulation of interest in a bank account
    d. The purchase of a company vehicle

15. Which of the following is an agency of the U.S. government?
    a. IASC
    b. FASB
    c. AICPA
    d. SEC

16. A $200 debit item is posted as a credit. The trial balance column totals
    therefore will differ by
    a. $800.
    b. $200.
    c. $400.
    d. $0.

17. The audit committee is responsible for all of the following except
    a. assuring that reliable accounting records are kept.
    b. auditing the company's financial statements.
    c. ascertaining that the company safeguards its resources.
    d. engaging the company's independent auditors.




                                                                            3
Use the information below to answer the following questions.

The trial balance for Butera Corporation appears as follows:

 êÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍë
 º                                     Butera Corporation                          º
 º                                         Trial Balance                           º
 º                                     December 31, 20xx                           º
 šÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÂÄÄÄÄÄÄÄÄÂÄÄÄÄÄÄÄÄ¡
 º Cash                                                  ³ $ 200 ³               º
 º Accounts Receivable                                   ³       500 ³           º
 º Prepaid Insurance                                     ³        50 ³           º
 º Supplies                                              ³       150 ³           º
 º Office Equipment                                      ³       400 ³           º
 º Accumulated Depreciation,                             ³             ³         º
 º      Office Equipment                                 ³             ³ $ 200 º
 º Accounts Payable                                      ³             ³     300 º
 º Common Stock                                          ³             ³     600 º
 º Service Revenue Earned                                ³             ³     500 º
 º Salaries Expense                                      ³       100 ³           º
 º Rent Expense                                          ³       200 ³ ______ º
 º                                                       ³ $1,600 ³ $1,600 º
 º                                                       ³ ÍÍÍÍÍÍ ³ ÍÍÍÍÍÍ º
 éÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍçÍÍÍÍÍÍÍÍçÍÍÍÍÍÍÍͦ

18. If   as of December 31, 20xx, the rent of $100 for December had not been recorded
    or   paid, the adjusting entry would include a
    a.   credit to Accumulated Rent for $100.
    b.   debit to Rent Payable for $100.
    c.   credit to Cash for $100.
    d.   debit to Rent Expense for $100.

19. The account most recently posted is determined most efficiently by referring
    to the
    a. date column of the general journal.
    b. Post. Ref. column of the general journal.
    c. Post. Ref. column of the ledger.
    d. balance column of the ledger.

20. An   auditor maintains no direct financial interest in the company he or she
    is   auditing. The principle being followed is
    a.   independence.
    b.   integrity.
    c.   objectivity.
    d.   due care.




                                                                                       4
21. Which of the following accounts could not be credited in an adjusting entry?
    a. Interest Receivable
    b. Earned Revenue
    c. Office Supplies
    d. Prepaid Rent

22. An   adjusting entry can include a debit to a(n)
    a.   liability and a credit to a revenue.
    b.   revenue and a credit to an asset.
    c.   expense and a credit to a revenue.
    d.   asset and a credit to a liability.

23. Financial statement time periods should be of equal length
    a. to comply with income tax regulations.
    b. and should correspond to the calendar year.
    c. and should end during the peak season.
    d. to make comparison easier.

24. Which of the following transactions decreases both assets and stockholders'
    equity?
    a. Declaration and payment of a dividend
    b. Receipt of a phone bill, to be paid at a later time
    c. Advance payment made for insurance
    d. Payment of a liability

25. When a service has been performed, but no cash has been received, which of
    the following statements is true?
    a. The entry would include a credit to Unearned Revenue.
    b. No journal entry would be made.
    c. The entry would include a debit to Accounts Receivable.
    d. The entry would include a debit to Accounts Payable.

26. The process of transferring journal entry information from the journal to
    the ledger is called
    a. journalizing.
    b. analyzing.
    c. footing.
    d. posting.

27. Which of the following accounts probably would contain a smaller dollar
    amount on the adjusted trial balance than on the trial balance?
    a. Accumulated Depreciation
    b. Wages Expense
    c. Cash
    d. Office Supplies




                                                                               5
28. Which of the following does not affect retained earnings?
    a. Incurring of expenses
    b. Earning of revenues
    c. Declaration and payment of dividends
    d. Investments by stockholders

29. In November, cash is received in advance of rendering services. Assuming that
    the services have been performed by December 31, the adjusting entry would
    be a debit to
    a. Cash and a credit to Service Revenue.
    b. Unearned Service Revenue and a credit to Service Revenue.
    c. Unearned Service Revenue and a credit to Cash.
    d. Service Revenue and a credit to Prepaid Services.

30. A customer's   promise to pay for goods or services
    a. creates a   liability for the company.
    b. decreases   the company's liabilities.
    c. increases   the company's Cash account.
    d. increases   the assets of the company.

31. An adjusted trial balance proves the balance of the ledger accounts after
    the adjusting entries have been posted.
    a. True
    b. False

32. Profitability means having enough funds on hand to pay debts when they fall
    due.
    a. True
    b. False

33. The balance sheet is also known as the statement of financial position.
    a. True
    b. False

34. All decreases in stockholders' equity are a result of expenses.
    a. True
    b. False

35. The journal is a chronological record of all transactions.
    a. True
    b. False

36. Enright Corporation's stockholders' equity equals one-third of the company's
    total assets. The company's liabilities are $120,000. What is the amount of
    the company's stockholders' equity?




                                                                                6
37. In the journal provided, prepare year-end adjustments for the following
    situations. Omit explanations.

    a. Accrued interest on notes receivable is $85.
    b. Of the $6,000 received in advance of earning a service, one-third
       was still unearned by year end.
    c. Three years' rent, totaling $36,000, was paid in advance at the
       beginning of the year.
    d. Services totaling $5,300 had been performed, but not yet billed.
    e. Depreciation on trucks totaled $2,700 for the year.
    f. Supplies available for use totaled $690. However, by year end, only
       $100 in supplies remained.
    g. Payroll for the five-day work week, to be paid on Friday, is
       $30,000. Year end falls on a Monday.
    h. Estimated federal income taxes were $2,875.

     êÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍë
     º                                               General Journal         Page 1 º

    šÄÄÄÄÄÄÄÂÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÂÄÄÄÄÄÂÄÄÄÄÄÄÄÄÂÄÄÄ
    ÄÄÄÄÄ¡
     º      ³                              ³Post.³       ³        º
     º Date ³ Description                  ³Ref. ³ Debit ³ Credit º

    šÄÄÄÄÄÄÄâÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄâÄÄÄÄÄâÄÄÄÄÄÄÄÄâÄÄÄ
    ÄÄÄÄÄ¡
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
     º      ³                              ³    ³       ³      º
                                                                                        7
º   ³   ³   ³   ³   º
º   ³   ³   ³   ³   º
º   ³   ³   ³   ³   º
º   ³   ³   ³   ³   º
º   ³   ³   ³   ³   º
º   ³   ³   ³   ³   º
º   ³   ³   ³   ³   º
º   ³   ³   ³   ³   º
º   ³   ³   ³   ³   º
º   ³   ³   ³   ³   º




                        8
     º              ³                                                        ³   ³   ³   º
     º              ³                                                        ³   ³   ³   º
     º              ³                                                        ³   ³   ³   º
     º              ³                                                        ³   ³   ³   º
     º              ³                                                        ³   ³   ³   º
     º              ³                                                        ³   ³   ³   º
     º              ³                                                        ³   ³   ³   º
     º              ³                                                        ³   ³   ³   º
     éÍÍÍÍÍÍÍçÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍçÍÍÍÍÍçÍÍÍÍÍÍÍÍçÍÍÍÍÍÍÍͦ

38. How do the Toys "R" Us balance sheets illustrate the accounting concept of
    separate entity?

    ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
    ÄÄÄÄÄÄÄ

    ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
    ÄÄÄÄÄÄÄ

    ÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ
    ÄÄÄÄÄÄÄ

39. Caruso's Pizza has a delivery truck it purchased for $30,000. The truck has
    an estimated useful life of six years and will be worthless at the end of
    that time. In the partial balance sheet below, show exactly how the truck
    would be disclosed after it has been used for two years. Also calculate total
    assets.

     êÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍë
     º                                     Caruso's Pizza            º
     º                               Partial Balance Sheet           º
     º                                   December 31, 20xx           º
     šÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄ¡
     º Cash                                                $10,000 º
     º Prepaid Rent                                            3,000 º
     º Truck                                                         º
     º                                                               º
     º                                                     ÄÄÄÄÄÄÄ º
     º                                                               º
     º Total Assets                                        $         º
     º                                                     ÍÍÍÍÍÍÍ º
     éÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍͦ




                                                                                             9
40. From the following alphabetical list of account balances, all of which are
    normal, for Sabre Corporation on July 31, 20xx, prepare a trial balance in
    proper form (the amount of Dividends must be computed).

    Accounts Payable                 $500
    Accounts Receivable               200
    Cash                               80
    Common Stock                       90
    Dividends                          ?
    Equipment                         700
    Prepaid Advertising                20
    Retained Earnings                  60
    Revenue Earned                    400
    Wages Expense                      70
    Wages Payable                      50

     êÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍë
     º                                                        º
     º                                                        º
     º                                                        º
     šÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÄÂÄÄÄÄÄÄÄÄÂÄÄÄÄÄÄÄÄ¡
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     º                                                  ³ ³ º
     éÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍÍçÍÍÍÍÍÍÍÍçÍÍÍÍÍÍÍͦ




                                                                            10
11

								
To top