Question 1

The account credited for a receipt of cash on account is

Accepted Answer

A) Cash. 
B) Service Revenue. 
C) Accounts Receivable. 
D) Accounts Payable. 
A) Cash. 
B) Service Revenue. 
C) Accounts Receivable. 
D) Accounts Payable.

Question 2

Use the following information to answers questions During 2014, Horn Corp.started a construction job with a total contract price of $700,000.Horn has consistently used the completed contract method.The job was completed on December 15,
-For 2014, what amount should Horn recognize as gross profit?

Accepted Answer

A) $ 0 
B) $80,000 
C) $95,000 
D) $125,000 
A) $ 0 
B) $80,000 
C) $95,000 
D) $125,000

Question 3

Which of the following does NOT correctly describe the FIFO cost formula?

Accepted Answer

A) This method assumes that the oldest inventory costs are the first costs recorded for cost
Of goods sold. 
B) This method assumes that most current inventory costs are the first costs recorded for
Cost of goods sold. 
C) This method approximates the physical flow of most types of goods. 
D) This method is permitted under both ASPE and IFRS. 
A) This method assumes that the oldest inventory costs are the first costs recorded for cost
Of goods sold. 
B) This method assumes that most current inventory costs are the first costs recorded for
Cost of goods sold. 
C) This method approximates the physical flow of most types of goods. 
D) This method is permitted under both ASPE and IFRS.

Question 4

On August 1, 2013, Black Corporation received $6,000 cash from a tenant for one year's rent in advance, and recorded the transaction with a credit to Rent Revenue.The December 31, 2013 required adjusting entry in connection with this would be

Accepted Answer

The answer of On August 1, 2013, Black Corporation received...

Question 5

Which of the following does NOT correctly describe the specific identification cost formula?

Accepted Answer

A) This method is most appropriate when goods are not interchangeable. 
B) This method is most appropriate when goods are interchangeable. 
C) This method is generally used for expensive, one-of-a-kind merchandise. 
D) This method is often used for merchandise with serial numbers such as televisions. 
A) This method is most appropriate when goods are not interchangeable. 
B) This method is most appropriate when goods are interchangeable. 
C) This method is generally used for expensive, one-of-a-kind merchandise. 
D) This method is often used for merchandise with serial numbers such as televisions.

Question 6

In preparing a statement of cash flows, repurchase of a company's own shares at an amount greater than cost would be classified as a(n)

Accepted Answer

A) operating activity. 
B) extraordinary activity. 
C) financing activity. 
D) investing activity. 
A) operating activity. 
B) extraordinary activity. 
C) financing activity. 
D) investing activity.

Question 7

The proposed new revenue recognition model currently being studied by the IASB and FASB is the

Accepted Answer

A) contract-based approach. 
B) earnings approach. 
C) percentage of completion method. 
D) completed contract method. 
A) contract-based approach. 
B) earnings approach. 
C) percentage of completion method. 
D) completed contract method.

Question 8

At year end, other comprehensive income is closed out to

Accepted Answer

A) retained earnings. 
B) share capital. 
C) accumulated other comprehensive income. 
D) net income. 
A) retained earnings. 
B) share capital. 
C) accumulated other comprehensive income. 
D) net income.

Question 9

Calculate depreciation and CCA Five identical vehicles which cost $500,000 (total)are acquired on April 1, 2014.Their estimated residual value is $20,000 and expected life is eight years.These assets are Class 10 with a maximum CCA rate of 30%.The company has a December 31 year end. Instructions Calculate the depreciation expense/CCA (to the nearest dollar)by each of the following methods:
a)Straight-line for 2014
b)Double declining-balance for 2015
c)Maximum Capital cost allowance for 2015

Accepted Answer

@#IMG-DLM& Depreciation, Impai

Question 10

Ratios that measure the degree of protection for long-term creditors and investors or the ability to meet long-term obligations are called

Accepted Answer

A) liquidity ratios. 
B) activity ratios. 
C) solvency ratios. 
D) profitability ratios. 
A) liquidity ratios. 
B) activity ratios. 
C) solvency ratios. 
D) profitability ratios.

Question 11

Under the completed-contract method,

Accepted Answer

A) revenue, costs, and gross profit are recognized during the contract. 
B) revenue and costs are recognized during the contract, but gross profit recognition is
Deferred until the contract is completed. 
C) costs are recognized during the contract, but revenue and gross profit are not. 
D) revenue, costs and gross profit are not recognized until the contract is finished. 
A) revenue, costs, and gross profit are recognized during the contract. 
B) revenue and costs are recognized during the contract, but gross profit recognition is
Deferred until the contract is completed. 
C) costs are recognized during the contract, but revenue and gross profit are not. 
D) revenue, costs and gross profit are not recognized until the contract is finished.

Question 12

The cost of goods available for sale is calculated as

Accepted Answer

A) beginning inventory plus ending inventory. 
B) beginning inventory minus ending inventory. 
C) beginning inventory plus the cost of goods acquired during the period. 
D) cost of goods acquired during the period minus ending inventory. 
A) beginning inventory plus ending inventory. 
B) beginning inventory minus ending inventory. 
C) beginning inventory plus the cost of goods acquired during the period. 
D) cost of goods acquired during the period minus ending inventory.

Question 13

Tehran Ltd.uses FIFO to cost its inventory.The following information is available for Tehran's inventory of product # 101: Beginning inventory: .120 units @ $3.14 per unit March 1: ...................Purchase of 250 units @ $3.50 per unit April 10: ....................Sale of 100 units @ $5.10 per unit Assuming Tehran uses the perpetual inventory system, the second entry to account for the April 10 sale is

Accepted Answer

A) debit Cost of Goods Sold and credit Inventory, $350. 
B) debit Cost of Goods Sold and credit Purchases, $350. 
C) debit Cost of Goods Sold and credit Inventory, $314. 
D) debit Cost of Goods Sold and credit Purchases, $314. 
A) debit Cost of Goods Sold and credit Inventory, $350. 
B) debit Cost of Goods Sold and credit Purchases, $350. 
C) debit Cost of Goods Sold and credit Inventory, $314. 
D) debit Cost of Goods Sold and credit Purchases, $314.

Question 14

If an entity sells on credit, the risk that the customer will not pay is called

Accepted Answer

A) price risk. 
B) credit risk. 
C) commercial substance. 
D) credit policy. 
A) price risk. 
B) credit risk. 
C) commercial substance. 
D) credit policy.

Question 15

Under the allowance method of recognizing uncollectible accounts, the entry to write off an uncollectible account

Accepted Answer

A) increases the allowance for doubtful accounts. 
B) has no effect on the allowance for doubtful accounts. 
C) has no effect on net income. 
D) decreases net income. 
A) increases the allowance for doubtful accounts. 
B) has no effect on the allowance for doubtful accounts. 
C) has no effect on net income. 
D) decreases net income.

Question 16

The overriding criterion by which accounting information can be judged is that of

Accepted Answer

A) usefulness for decision making. 
B) freedom from bias. 
C) timeliness. 
D) comparability. 
A) usefulness for decision making. 
B) freedom from bias. 
C) timeliness. 
D) comparability.

Question 17

Use the following information for questions through. Tang Inc.uses the retail inventory method.The following information is available for the current year:  
-If the ending inventory is to be valued at approximately lower of average cost and market, the calculation of the cost ratio should be based on cost and retail of

Accepted Answer

A) $450,000 and $645,000. 
B) $450,000 and $642,000. 
C) $559,000 and $825,000. 
D) $567,000 and $828,000. 
A) $450,000 and $645,000. 
B) $450,000 and $642,000. 
C) $559,000 and $825,000. 
D) $567,000 and $828,000.

Question 18

"Sales Returns and Allowances" are reported as

Accepted Answer

A) an expense. 
B) a deduction from Sales Revenue. 
C) a deduction from Accounts Receivable. 
D) an addition to Accounts Receivable. 
A) an expense. 
B) a deduction from Sales Revenue. 
C) a deduction from Accounts Receivable. 
D) an addition to Accounts Receivable.

Question 19

The "efficient markets hypothesis" proposes that

Accepted Answer

A) market prices reflect information known only to internal stakeholders. 
B) market prices reflect all information about a company. 
C) market prices reflect information known only to external stakeholders. 
D) information asymmetry is required. 
A) market prices reflect information known only to internal stakeholders. 
B) market prices reflect all information about a company. 
C) market prices reflect information known only to external stakeholders. 
D) information asymmetry is required.

Question 20

Which of the following is considered as "cash" for reporting purposes?

Accepted Answer

A) money market chequing accounts 
B) certificates of deposit (CDs) 
C) travel advances to employees 
D) postdated cheques 
A) money market chequing accounts 
B) certificates of deposit (CDs) 
C) travel advances to employees 
D) postdated cheques

The account credited for a receipt of cash on account is

Use the following information to answers questions During 2014, Horn Corp.started a construction job with a total contract price of $700,000.Horn has consistently used the completed contract method.The job was completed on December 15, -For 2014, what amount should Horn recognize as gross profit?

Which of the following does NOT correctly describe the FIFO cost formula?

On August 1, 2013, Black Corporation received $6,000 cash from a tenant for one year's rent in advance, and recorded the transaction with a credit to Rent Revenue.The December 31, 2013 required adjusting entry in connection with this would be

Which of the following does NOT correctly describe the specific identification cost formula?

In preparing a statement of cash flows, repurchase of a company's own shares at an amount greater than cost would be classified as a(n)

The proposed new revenue recognition model currently being studied by the IASB and FASB is the

At year end, other comprehensive income is closed out to

Ratios that measure the degree of protection for long-term creditors and investors or the ability to meet long-term obligations are called

Under the completed-contract method,

The cost of goods available for sale is calculated as

If an entity sells on credit, the risk that the customer will not pay is called

Under the allowance method of recognizing uncollectible accounts, the entry to write off an uncollectible account

The overriding criterion by which accounting information can be judged is that of

"Sales Returns and Allowances" are reported as

The "efficient markets hypothesis" proposes that

Which of the following is considered as "cash" for reporting purposes?

Intermediate Accounting Volume 2

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Exam 1: Intermediate Accounting Volume 1

The account credited for a receipt of cash on account is

Use the following information to answers questions During 2014, Horn Corp.started a construction job with a total contract price of $700,000.Horn has consistently used the completed contract method.The job was completed on December 15, -For 2014, what amount should Horn recognize as gross profit?

Which of the following does NOT correctly describe the FIFO cost formula?

On August 1, 2013, Black Corporation received $6,000 cash from a tenant for one year's rent in advance, and recorded the transaction with a credit to Rent Revenue.The December 31, 2013 required adjusting entry in connection with this would be

Which of the following does NOT correctly describe the specific identification cost formula?

In preparing a statement of cash flows, repurchase of a company's own shares at an amount greater than cost would be classified as a(n)

The proposed new revenue recognition model currently being studied by the IASB and FASB is the

At year end, other comprehensive income is closed out to

Ratios that measure the degree of protection for long-term creditors and investors or the ability to meet long-term obligations are called

Under the completed-contract method,

The cost of goods available for sale is calculated as

If an entity sells on credit, the risk that the customer will not pay is called

Under the allowance method of recognizing uncollectible accounts, the entry to write off an uncollectible account

The overriding criterion by which accounting information can be judged is that of

"Sales Returns and Allowances" are reported as

The "efficient markets hypothesis" proposes that

Which of the following is considered as "cash" for reporting purposes?

Intermediate Accounting Volume 2

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