Question 1

Mycro Corporation, a computer service company, had the following transactions during 2012.

Accepted Answer

The answer of Mycro Corporation, a computer service company, had...

Question 2

Under accrual-basis accounting, revenue is recognized

Accepted Answer

A)  When cash is received without regard to when the services are rendered 
B)  When the services are rendered without regard to when cash is received 
C)  When cash is received before the time services are rendered 
D)  If cash is received after the services are rendered 
A)  When cash is received without regard to when the services are rendered 
B)  When the services are rendered without regard to when cash is received 
C)  When cash is received before the time services are rendered 
D)  If cash is received after the services are rendered

Question 3

Which of the following statements is true of a post-closing trial balance?

Accepted Answer

A)  Its debits must equal its credits 
B)  It lists all real and nominal account balances 
C)  It may be prepared before the closing process to provide some assurance that the previous steps in the cycle have been performed properly 
D)  All of these are true 
A)  Its debits must equal its credits 
B)  It lists all real and nominal account balances 
C)  It may be prepared before the closing process to provide some assurance that the previous steps in the cycle have been performed properly 
D)  All of these are true

Question 4

On December 31, the trial balance of Fife Company included the following account with a credit balance: Unearned advertising revenue$\quad$$\quad$$\quad$$\quad$$\quad$$\quad$$ \$ 16,200 $ If it is determined that the amount of advertising revenue applicable to future periods is $10,400, the correct adjusting entry would be:

Accepted Answer

A)  Debit Unearned Advertising Revenue $10,400; credit Advertising Revenue $10,400 
B)  Debit Advertising Revenue $10,400; credit Unearned Advertising Revenue $10,400 
C)  Debit Unearned Advertising Revenue $5,800; credit Advertising Revenue $5,800 
D)  Debit Advertising Revenue $5,800; credit Unearned Advertising Revenue $5,800 
A)  Debit Unearned Advertising Revenue $10,400; credit Advertising Revenue $10,400 
B)  Debit Advertising Revenue $10,400; credit Unearned Advertising Revenue $10,400 
C)  Debit Unearned Advertising Revenue $5,800; credit Advertising Revenue $5,800 
D)  Debit Advertising Revenue $5,800; credit Unearned Advertising Revenue $5,800

Question 5

On October 1, Doe Hunting Supplies, a calendar-year company, sold inventory that cost $60,000 for $100,000. The customer signed a six-month, 10 percent note in payment. On December 31, Woods should

Accepted Answer

A)  Debit Interest Receivable for $2,500 
B)  Debit Interest Revenue for $2,500 
C)  Credit Interest Revenue for $10,000 
D)  Debit Interest Receivable for $10,000 
A)  Debit Interest Receivable for $2,500 
B)  Debit Interest Revenue for $2,500 
C)  Credit Interest Revenue for $10,000 
D)  Debit Interest Receivable for $10,000

Question 6

Nominal accounts are NOT found on which of the following financial statements?

Accepted Answer

A)  Balance sheet 
B)  Income statement 
C)  Statement of cash flows 
D)  Retained earnings statement 
A)  Balance sheet 
B)  Income statement 
C)  Statement of cash flows 
D)  Retained earnings statement

Question 7

The following are a selection of account balances taken from the Adjusted Trial Balance of Cajon Corporation for December 31, 2012:
 
- Refer to Exhibit 4-1. Given the information above, what is the amount of total assets on Cajon Corporation's balance sheet in 2012?

Accepted Answer

A)  $150 
B)  $300 
C)  $450 
D)  $650 
A)  $150 
B)  $300 
C)  $450 
D)  $650

Question 8

Which of the following is NOT a true statement?

Accepted Answer

A)  Expenses are closed with a credit 
B)  Revenues are closed with a debit 
C)  Dividends are closed with a credit 
D)  Retained Earnings are closed with a debit 
A)  Expenses are closed with a credit 
B)  Revenues are closed with a debit 
C)  Dividends are closed with a credit 
D)  Retained Earnings are closed with a debit

Question 9

Brooklynne Company paid $25,400 in insurance premiums during 2012. Brooklynne showed $6,800 in prepaid insurance on its December 31, 2012, balance sheet and $4,600 on December 31, 2013. The insurance expense on the income statement for 2013 was

Accepted Answer

A)  $18,600 
B)  $27,600 
C)  $23,200 
D)  $30,000 
A)  $18,600 
B)  $27,600 
C)  $23,200 
D)  $30,000

Question 10

Prior to making any adjusting entries, Terra Corporation had net income of $155,100. The following adjusting entries were made: salaries payable, $1,574; interest earned on short-term investments but not yet recorded or collected, $7,268; adjustment to prepaid insurance for $5,538 for an insurance policy that expired during the period; and fees of $586 collected in advance that have now been earned. After recording these adjustments, net income would be

Accepted Answer

A)  $170,084 
B)  158,008 
C)  155,842 
D)  155,836 
A)  $170,084 
B)  158,008 
C)  155,842 
D)  155,836

Question 11

Each adjusting entry will always affect

Accepted Answer

A)  Only balance sheet accounts 
B)  At least one income statement account and one retained earnings statement account 
C)  At least one balance sheet account and one income statement account 
D)  Only income statement accounts 
A)  Only balance sheet accounts 
B)  At least one income statement account and one retained earnings statement account 
C)  At least one balance sheet account and one income statement account 
D)  Only income statement accounts

Question 12

In the course of your examination of the books and records of Griffin Company for the year ending December 31, 2012, you find the following data:

Accepted Answer

The answer of In the course of your examination of...

Question 13

Which of the following accounts would NOT appear in the post-closing trial balance?

Accepted Answer

A)  Unearned Service Fees Revenue 
B)  Dividends 
C)  Supplies 
D)  Salaries Payable 
A)  Unearned Service Fees Revenue 
B)  Dividends 
C)  Supplies 
D)  Salaries Payable

Question 14

Which of the following types of accounts will always be debited to adjust for an unrecorded receivable?

Accepted Answer

A)  Liabilities 
B)  Revenues 
C)  Receivables 
D)  Expenses 
A)  Liabilities 
B)  Revenues 
C)  Receivables 
D)  Expenses

Question 15

If on December 31, 2012, interest expense of $600 is owed on a bank note that will NOT be paid until July 2013, what is the appropriate adjusting entry at the end of 2012?

Accepted Answer

A) 
$\begin{array} { c c } 
\text { Interest Expense } & 600 \
\text { Cash } & 600
\end{array}$ 
B) 
$\begin{array} { c r } 
\text { Interest Expense } & 600 \
\text { Interest Payable } & 600
\end{array}$ 
C)  
$\begin{array}{lll}
\text { Cash } & 600 & \
\text { Interest Expense } & & 600
\end{array}$ 
D)  
$\begin{array} { l r l } 
\text { Interest Payable } & 600 \
\text { Interest Expense } & 600
\end{array}$ 
A) 
$\begin{array} { c c } 
\text { Interest Expense } & 600 \
\text { Cash } & 600
\end{array}$ 
B) 
$\begin{array} { c r } 
\text { Interest Expense } & 600 \
\text { Interest Payable } & 600
\end{array}$ 
C)  
$\begin{array}{lll}
\text { Cash } & 600 & \
\text { Interest Expense } & & 600
\end{array}$ 
D)  
$\begin{array} { l r l } 
\text { Interest Payable } & 600 \
\text { Interest Expense } & 600
\end{array}$

Question 16

The dividends account is

Accepted Answer

A)  An asset 
B)  An expense 
C)  A revenue 
D)  None of these are correct 
A)  An asset 
B)  An expense 
C)  A revenue 
D)  None of these are correct

Question 17

Which of the following describes the correct order of how financial statements are prepared from the information taken from the trial balance?

Accepted Answer

A)  Compute net income, Identify all revenues and expenses, Compute the ending retained earnings balance, Prepare a balance sheet 
B)  Identify all revenues and expenses, Prepare a balance sheet, Compute the ending retained earnings balance, Compute net income 
C)  Compute the ending retained earnings balance, Compute net income, Prepare a balance sheet, Identify all revenues and expenses. 
D)  Identify all revenues and expenses, Compute net income, Compute the ending retained earnings balance, Prepare a balance sheet. 
A)  Compute net income, Identify all revenues and expenses, Compute the ending retained earnings balance, Prepare a balance sheet 
B)  Identify all revenues and expenses, Prepare a balance sheet, Compute the ending retained earnings balance, Compute net income 
C)  Compute the ending retained earnings balance, Compute net income, Prepare a balance sheet, Identify all revenues and expenses. 
D)  Identify all revenues and expenses, Compute net income, Compute the ending retained earnings balance, Prepare a balance sheet.

Question 18

The original entry to record a prepaid expense will usually include

Accepted Answer

A)  A debit to an asset account and a credit to another asset account 
B)  A debit to an asset account and a credit to an expense account 
C)  A debit to an expense account and a credit to an asset account 
D)  None of these are correct 
A)  A debit to an asset account and a credit to another asset account 
B)  A debit to an asset account and a credit to an expense account 
C)  A debit to an expense account and a credit to an asset account 
D)  None of these are correct

Question 19

During 2013, Rumbo Corporation had cash and credit sales of $21,760 and $15,225, respectively. The company also collected accounts receivable of $9,765 and incurred operating expenses of $27,700, 80 percent of which were paid during the year. In addition, Rumbo paid $4,500 for an 18-month advertising campaign that began on September 30. Rumbo's accrual-basis net income (loss) for 2009 was

Accepted Answer

A)  $9,285 
B)  $8,535 
C)  $14,075 
D)  $(775) 
A)  $9,285 
B)  $8,535 
C)  $14,075 
D)  $(775)

Question 20

Which of the following is true of a work sheet?

Accepted Answer

A)  It is prepared for distribution to outsiders. 
B)  It facilitates the preparation of financial statements. 
C)  It is the next to last step in the accounting cycle. 
D)  It is a required step in the accounting cycle. 
A)  It is prepared for distribution to outsiders. 
B)  It facilitates the preparation of financial statements. 
C)  It is the next to last step in the accounting cycle. 
D)  It is a required step in the accounting cycle.

Exam 4: Completing the Accounting Cycle

Mycro Corporation, a computer service company, had the following transactions during 2012.

Under accrual-basis accounting, revenue is recognized

Which of the following statements is true of a post-closing trial balance?

On October 1, Doe Hunting Supplies, a calendar-year company, sold inventory that cost $60,000 for $100,000. The customer signed a six-month, 10 percent note in payment. On December 31, Woods should

Nominal accounts are NOT found on which of the following financial statements?

The following are a selection of account balances taken from the Adjusted Trial Balance of Cajon Corporation for December 31, 2012: - Refer to Exhibit 4-1. Given the information above, what is the amount of total assets on Cajon Corporation's balance sheet in 2012?

Which of the following is NOT a true statement?

Brooklynne Company paid $25,400 in insurance premiums during 2012. Brooklynne showed $6,800 in prepaid insurance on its December 31, 2012, balance sheet and $4,600 on December 31, 2013. The insurance expense on the income statement for 2013 was

Each adjusting entry will always affect

In the course of your examination of the books and records of Griffin Company for the year ending December 31, 2012, you find the following data:

Which of the following accounts would NOT appear in the post-closing trial balance?

Which of the following types of accounts will always be debited to adjust for an unrecorded receivable?

If on December 31, 2012, interest expense of $600 is owed on a bank note that will NOT be paid until July 2013, what is the appropriate adjusting entry at the end of 2012?

The dividends account is

Which of the following describes the correct order of how financial statements are prepared from the information taken from the trial balance?

The original entry to record a prepaid expense will usually include

Which of the following is true of a work sheet?

Accounting Information: Users and Uses

Financial Statements: An Overview

The Accounting Cycle: The Mechanics of Accounting

Internal Controls: Ensuring the Integrity of Financial Information

Receivables: Selling a Product or a Service

Inventory and the Cost of Sales

Completing the Operating Cycle

Investments: Property, Plant, and Equipment and Intangible Assets

Financing: Long-Term Liabilities

Financing: Equity

Investments: Debt and Equity Securities

Statement of Cash Flows

Analyzing Financial Statements

Management Accounting and Cost Concepts

Cost Flows and Business Organizations

Activity-Based Costing

Budgeting and Control

Controlling Cost and Profit

Inventory Management and Variable and Absorption Costing

Cost Behavior and Decisions Using C-V-P Analysis

Relevant Information and Decisions

Capital Investment Decisions

New Measures of Performance

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