Question 1

The statement of cash flows reflects the revenues actually earned by the business, regardless of whether cash has been collected.

Accepted Answer

A) True 
 B)False

Question 2

According to the revenue recognition principle, revenues are recognized when they are _________________________.

Accepted Answer

The answer of According to the revenue recognition principle, revenues...

Question 3

A company forgot to record four adjustments during 2016.Which one of the following omissions of adjustments will understate net income?

Accepted Answer

A)  Sales made during the last week of the period are not recorded. 
B)  Interest on monies borrowed has not yet been recorded. 
C)  Prepaid insurance is not reduced for the portion of the policy that has expired during the period. 
D)  Income taxes owed but not yet paid are ignored. 
A)  Sales made during the last week of the period are not recorded. 
B)  Interest on monies borrowed has not yet been recorded. 
C)  Prepaid insurance is not reduced for the portion of the policy that has expired during the period. 
D)  Income taxes owed but not yet paid are ignored.

Question 4

Failure to record the supplies used during the year would result in which of the following?

Accepted Answer

A)  Net income being understated 
B)  An overstatement of liabilities 
C)  Stockholders' equity being overstated 
D)  Total assets being understated 
A)  Net income being understated 
B)  An overstatement of liabilities 
C)  Stockholders' equity being overstated 
D)  Total assets being understated

Question 5

CBA Corp.has grown significantly over the past year.One area that has plagued the Controller of CBA is the reconciliation of supplies expense.The end-of-year supplies on hand totaled $20, and purchases totaled $500, and supplies on hand at the beginning of the year amounted to $300.How much will CBA report as supplies expense for the current year?

Accepted Answer

A)  $ 20 
B)  $ 780 
C)  $ 300 
D)  $ 500 
A)  $ 20 
B)  $ 780 
C)  $ 300 
D)  $ 500

Question 6

A(n) ____________________ creates an increase in income for the period.

Accepted Answer

The answer of A(n) ____________________ creates an increase in income...

Question 7

A company forgot to record four adjustments during 2016.Which one of the following omissions of adjustments will overstate assets?

Accepted Answer

A)  Sales made during the last week of the period are not recorded. 
B)  Interest on monies borrowed has not yet been recorded. 
C)  Prepaid insurance is not reduced for the portion of the policy that has expired during the period. 
D)  Income taxes owed but not yet paid are ignored. 
A)  Sales made during the last week of the period are not recorded. 
B)  Interest on monies borrowed has not yet been recorded. 
C)  Prepaid insurance is not reduced for the portion of the policy that has expired during the period. 
D)  Income taxes owed but not yet paid are ignored.

Question 8

Failure to record the earned portion of unearned revenue would result in which of the following?

Accepted Answer

A)  Net income being understated 
B)  No effect on total liabilities 
C)  Stockholders' equity being overstated 
D)  Total assets being understated 
A)  Net income being understated 
B)  No effect on total liabilities 
C)  Stockholders' equity being overstated 
D)  Total assets being understated

Question 9

Masters Company borrowed on a one-year, 10%, $150,000 note on May 1, with interest and principal to be paid at maturity.How much interest payable will be reported on Masters' balance sheet as of November 30 of the same year?

Accepted Answer

A)  $ 7,500 
B)  $ 8,750 
C)  $ 15,000 
D)  $ 30,000 
A)  $ 7,500 
B)  $ 8,750 
C)  $ 15,000 
D)  $ 30,000

Question 10

Which one of the following is an example of an accrued liability?

Accepted Answer

A)  Wages have been earned by employees, but have not been paid at the end of the period. 
B)  Equipment that will benefit several periods has been purchased. 
C)  An insurance policy that expires in a future period has been acquired. 
D)  Supplies are purchased and used over several months. 
A)  Wages have been earned by employees, but have not been paid at the end of the period. 
B)  Equipment that will benefit several periods has been purchased. 
C)  An insurance policy that expires in a future period has been acquired. 
D)  Supplies are purchased and used over several months.

Question 11

What happens to the accounting equation when the adjustment for depreciation expense for the accounting period is recorded?

Accepted Answer

A)  Assets decrease and stockholders' equity decreases. 
B)  Assets increase and stockholders' equity increases. 
C)  Assets decrease and liabilities decrease. 
D)  Liabilities increase and stockholders' equity decreases. 
A)  Assets decrease and stockholders' equity decreases. 
B)  Assets increase and stockholders' equity increases. 
C)  Assets decrease and liabilities decrease. 
D)  Liabilities increase and stockholders' equity decreases.

Question 12

Why is the use of the U.S.dollar as a unit of measure for financial statement data in the U.S.widely accepted?

Accepted Answer

A)  U.S.dollar remains stable over a long period of time. 
B)  U.S.dollar is universally recognized as a reliable financial measure. 
C)  U.S.dollar is the medium of monetary exchange in the U.S. 
D)  U.S.dollar is required for financial statement presentation by the FASB and SEC. 
A)  U.S.dollar remains stable over a long period of time. 
B)  U.S.dollar is universally recognized as a reliable financial measure. 
C)  U.S.dollar is the medium of monetary exchange in the U.S. 
D)  U.S.dollar is required for financial statement presentation by the FASB and SEC.

Question 13

Grove Corp.purchased equipment at a cost of $260,000 in January, 2012.As of January 1, 2016, depreciation of $88,000 had been recorded on this asset.Depreciation expense for 2016 is $22,000.After the adjustments are recorded and posted at December 31, 2016.What are the balances for the Depreciation Expense and Accumulated Depreciation? ​​ $\begin{array}{lc}
\underline{\text { Depreciation Expense }}& \underline{\text { Accumulated Depreciation}} \
\text { a. } \$ 22,000 & \$ 110,000 \
\text { b. } \$ 22,000 & \$ 88,000 \
\text { c. } \$ 110,000 & \$ 110,000 \
\text { d. } \$ 110,000 & \$ 88,000
\end{array}$

Accepted Answer

The answer of Grove Corp.purchased equipment at a cost of...

Question 14

Gear Shop purchased supplies at a cost of $1,000 during the year.At January 1, the beginning balance in the supplies account was $300.At December 31, supplies on hand are $100.Determine supplies expense for the year.

Accepted Answer

A)  $ 1,300 
B)  $ 1,200 
C)  $ 1,100 
D)  $ 1,400 
A)  $ 1,300 
B)  $ 1,200 
C)  $ 1,100 
D)  $ 1,400

Question 15

Failure to record dividends paid would result in which of the following?

Accepted Answer

A)  Net income being understated 
B)  An increase in total liabilities 
C)  Stockholders' equity being overstated 
D)  Total assets being understated 
A)  Net income being understated 
B)  An increase in total liabilities 
C)  Stockholders' equity being overstated 
D)  Total assets being understated

Question 16

Expired costs are called assets.

Accepted Answer

A) True 
 B)False

Question 17

Recognition is the process of formally recording or incorporating an item into the financial statements.

Accepted Answer

A) True 
 B)False

Question 18

Which of the following statements is true concerning assets?

Accepted Answer

A)  Assets represent future economic sacrifices. 
B)  Assets are expired costs. 
C)  Assets become expenses at the time they are paid in cash. 
D)  Assets become expenses when their economic benefits expire. 
A)  Assets represent future economic sacrifices. 
B)  Assets are expired costs. 
C)  Assets become expenses at the time they are paid in cash. 
D)  Assets become expenses when their economic benefits expire.

Question 19

Measurement of the economic effects on an entity involves each of the following except

Accepted Answer

A)  Quantification of effects 
B)  Identification of the attribute to be measured 
C)  Selection of an appropriate unit of measure 
D)  Recording the economic effects in the financial statements 
A)  Quantification of effects 
B)  Identification of the attribute to be measured 
C)  Selection of an appropriate unit of measure 
D)  Recording the economic effects in the financial statements

Question 20

Which of the following accounts is not closed to Income Summary at the end of the accounting period?

Accepted Answer

A)  Rent Expense 
B)  Service Revenue 
C)  Unearned Revenue 
D)  Supplies Expense 
A)  Rent Expense 
B)  Service Revenue 
C)  Unearned Revenue 
D)  Supplies Expense

The statement of cash flows reflects the revenues actually earned by the business, regardless of whether cash has been collected.

According to the revenue recognition principle, revenues are recognized when they are _________________________.

A company forgot to record four adjustments during 2016.Which one of the following omissions of adjustments will understate net income?

Failure to record the supplies used during the year would result in which of the following?

A(n) ____________________ creates an increase in income for the period.

A company forgot to record four adjustments during 2016.Which one of the following omissions of adjustments will overstate assets?

Failure to record the earned portion of unearned revenue would result in which of the following?

Masters Company borrowed on a one-year, 10%, $150,000 note on May 1, with interest and principal to be paid at maturity.How much interest payable will be reported on Masters' balance sheet as of November 30 of the same year?

Which one of the following is an example of an accrued liability?

What happens to the accounting equation when the adjustment for depreciation expense for the accounting period is recorded?

Why is the use of the U.S.dollar as a unit of measure for financial statement data in the U.S.widely accepted?

Gear Shop purchased supplies at a cost of $1,000 during the year.At January 1, the beginning balance in the supplies account was $300.At December 31, supplies on hand are $100.Determine supplies expense for the year.

Failure to record dividends paid would result in which of the following?

Expired costs are called assets.

Recognition is the process of formally recording or incorporating an item into the financial statements.

Which of the following statements is true concerning assets?

Measurement of the economic effects on an entity involves each of the following except

Which of the following accounts is not closed to Income Summary at the end of the accounting period?

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Inventories and Cost of Goods Sold

Cash and Internal Control

Receivables and Investments

Operating Assets: Property, Plant and Equipment, and Intangibles

Current Liabilities, Contingencies, and the True Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Exploring Accounting Standards and Differences around the World

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Exam 4: Income Measurement and Accrual Accounting

The statement of cash flows reflects the revenues actually earned by the business, regardless of whether cash has been collected.

According to the revenue recognition principle, revenues are recognized when they are _________________________.

A company forgot to record four adjustments during 2016.Which one of the following omissions of adjustments will understate net income?

Failure to record the supplies used during the year would result in which of the following?

A(n) ____________________ creates an increase in income for the period.

A company forgot to record four adjustments during 2016.Which one of the following omissions of adjustments will overstate assets?

Failure to record the earned portion of unearned revenue would result in which of the following?

Masters Company borrowed on a one-year, 10%, $150,000 note on May 1, with interest and principal to be paid at maturity.How much interest payable will be reported on Masters' balance sheet as of November 30 of the same year?

Which one of the following is an example of an accrued liability?

What happens to the accounting equation when the adjustment for depreciation expense for the accounting period is recorded?

Why is the use of the U.S.dollar as a unit of measure for financial statement data in the U.S.widely accepted?

Gear Shop purchased supplies at a cost of $1,000 during the year.At January 1, the beginning balance in the supplies account was $300.At December 31, supplies on hand are $100.Determine supplies expense for the year.

Failure to record dividends paid would result in which of the following?

Expired costs are called assets.

Recognition is the process of formally recording or incorporating an item into the financial statements.

Which of the following statements is true concerning assets?

Measurement of the economic effects on an entity involves each of the following except

Which of the following accounts is not closed to Income Summary at the end of the accounting period?

Accounting As a Form of Communication

Financial Statements and the Annual Report

Processing Accounting Information

Inventories and Cost of Goods Sold

Cash and Internal Control

Receivables and Investments

Operating Assets: Property, Plant and Equipment, and Intangibles

Current Liabilities, Contingencies, and the True Value of Money

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Exploring Accounting Standards and Differences around the World

Filters