Question 1

Match between columns
                        Premises: Controls designed to fix errors
An accounting principle which requires that expenses should be recognized in the same period as the revenue they helped generate
An accounting assumption which requires that financial statement items be measured in monetary units
An accounting method in which revenues are recognized when earned and expenses recognized when incurred
Transactions in which the exchange of cash takes place before the revenue is earned or the expense incurred.
An accounting assumption which assumes that a company will continue to be in business in the future
An accounting principle which requires that financial statement items should be reported at their costs at the time of the transaction
Controls designed to prevent an error or irregularity
An accounting principle which requires that revenue should be recognized when it is earned
Transactions in which the revenue is earned or the expense is incurred before the exchange of cash
Procedures to find errors
An accounting method in which revenues are recognized when cash is collected and expenses are recognized when cash is disbursed

Accepted Answer

The Answer of accrual accounting and detective controls and going-concern is...

Question 2

Match between columns
                        Premises: Amounts the company owes its vendors
The economic resources of a company resulting from past transactions
Liabilities the company will pay off within the next fiscal year
Amounts customers owe a company for goods or services purchased on credit
Obligations the company has incurred to obtain the assets it owns
Insurance a business has purchased,but not yet used
Assets the company plans to turn into cash or use to generate revenue in the next fiscal year
The amount the owners have put into their business
Financial statement which shows subtotals for current assets and current liabilities
The process of making changes in the accounting records,at the end of an accounting period to make sure that the amounts reflect the financial condition of a company as of that date
Name for the owners' claims to the assets of the business which includes both contributed capital and retained earnings

Accepted Answer

The Answer of current assets and contributed capital and accounts is...

Question 3

Accounts receivable represents ________.

Accepted Answer

A) amounts owed by the company to suppliers 
B) amounts owed to the company by customers 
C) revenue 
D) shareholders' equity 
A) amounts owed by the company to suppliers 
B) amounts owed to the company by customers 
C) revenue 
D) shareholders' equity

Question 4

Gross profit equals ________.

Accepted Answer

A) sales minus cost of goods sold 
B) operating income minus cost of goods sold 
C) the increase in cash for the period 
D) revenue minus expenses 
A) sales minus cost of goods sold 
B) operating income minus cost of goods sold 
C) the increase in cash for the period 
D) revenue minus expenses

Question 5

Comparability means that companies should use the same accounting rules from period to period.

Accepted Answer

A) True 
 B)False

Question 6

Clean Sweep agreed to clean an office building on a weekly basis for $1,000 per week.The contract began on August 15,and Clean Sweep cleaned the building twice during August.Clean Sweep received $2,000 cash in September for the cleaning performed in August.How much revenue should Clean Sweep recognize in August using cash-basis accounting?

Accepted Answer

Since Clean Sweep re

Question 7

Describe internal controls and discuss why internal controls are necessary for a business.

Accepted Answer

Internal controls are the policies and p

Question 8

Financial statements may be prepared ________.

Accepted Answer

A) weekly 
B) monthly 
C) quarterly 
D) All of these are correct. 
A) weekly 
B) monthly 
C) quarterly 
D) All of these are correct.

Question 9

Detective controls include ________.

Accepted Answer

A) separating the duties of cash collection from the duties of recording cash transactions in the books 
B) bank reconciliations (comparing the company's accounting records for cash to its bank statement) 
C) limiting access to assets 
D) requiring passwords to access the computerized accounting records 
A) separating the duties of cash collection from the duties of recording cash transactions in the books 
B) bank reconciliations (comparing the company's accounting records for cash to its bank statement) 
C) limiting access to assets 
D) requiring passwords to access the computerized accounting records

Question 10

During May,Team Shirts spent $4,000 to buy 800 T-shirts and sold 300 of them for $15 each.Team Shirts should recognize ________ as expense for May.

Accepted Answer

A) $4,500 
B) $1,500 
C) $3,750 
D) $4,000 
A) $4,500 
B) $1,500 
C) $3,750 
D) $4,000

Question 11

Internal controls are the policies and procedures managers of a firm use to protect the firm's assets and to ensure the accuracy and reliability of the firm's accounting records.

Accepted Answer

A) True 
 B)False

Question 12

The accounting rule which requires that only the business transactions of Team Shirts be shown on the balance sheet is the ________.

Accepted Answer

A) separate-entity assumption 
B) going-concern assumption 
C) monetary-unit assumption 
D) historical-cost principle 
A) separate-entity assumption 
B) going-concern assumption 
C) monetary-unit assumption 
D) historical-cost principle

Question 13

Beta Company reported the following information in its year ended December 31,2012 financials:
   1.What were the company's total expenses?
2.How much of the company's profits have been kept by the company as of 1/1/12?
3.What is the balance of retained earnings at December 31,2012?

Accepted Answer

1.$60,000 = $75,000

Question 14

Internal controls are ________.

Accepted Answer

A) laws and regulations imposed by the IRS and SEC to ensure the accuracy of financial statements 
B) accounting procedures required by the FASB to ensure the accuracy and reliability of firms' accounting records 
C) policies and procedures the managers of a firm use to protect a firm's assets and the accuracy of its accounting records 
D) rules required by creditors to ensure repayment of liabilities 
A) laws and regulations imposed by the IRS and SEC to ensure the accuracy of financial statements 
B) accounting procedures required by the FASB to ensure the accuracy and reliability of firms' accounting records 
C) policies and procedures the managers of a firm use to protect a firm's assets and the accuracy of its accounting records 
D) rules required by creditors to ensure repayment of liabilities

Question 15

Discuss the qualities of accounting information.

Accepted Answer

Usefulness is the most important charact

Question 16

Cash is ________.

Accepted Answer

A) part of retained earnings 
B) found on the income statement 
C) equal to net income on the income statement 
D) found on the balance sheet 
A) part of retained earnings 
B) found on the income statement 
C) equal to net income on the income statement 
D) found on the balance sheet

Question 17

Busy Beaver had revenues of $2,000,cost of goods sold of $780,advertising expense of $100,and interest expense of $25.Gross profit was ________.

Accepted Answer

A) $1,095 
B) $1,120 
C) $1,195 
D) $1,220 
A) $1,095 
B) $1,120 
C) $1,195 
D) $1,220

Question 18

Analyze each of the following transactions and determine the effect on the accounting equation.
1.Purchased three months' worth of prepaid advertising for $300.
2.Paid $500 cash on an account payable.
3.Paid $100 for supplies.
4.Performed $4,000 of services on account.

Accepted Answer

1.Increased assets $300 and decreased as

Question 19

For information to be useful,it must be relevant and reliable.

Accepted Answer

A) True 
 B)False

Question 20

Team Instructions: Divide the class into teams of three or four people.Each team member should work the following problem separately outside of class.Then give the students time in class to compare answers with their teammates and put together a final correct copy of the problem.Each team should turn in only one copy of the problem for grading.All team members will receive the same grade.
First do Parts A through C on your own.Then get together with your team and prepare a team solution to hand in.
Part A: Record Icon Consultant's transactions below by filling in the amount and the account title from the list of accounts below (use the abbreviations given):
     Part B: Using Part A,fill in the missing information on the following financial statements for the year ended December 31,2012.   Part C:

Accepted Answer

Part A: @#IMG-DLM&_TB5475_00 P

Accounts receivable represents ________.

Gross profit equals ________.

Comparability means that companies should use the same accounting rules from period to period.

Describe internal controls and discuss why internal controls are necessary for a business.

Financial statements may be prepared ________.

Detective controls include ________.

During May,Team Shirts spent $4,000 to buy 800 T-shirts and sold 300 of them for $15 each.Team Shirts should recognize ________ as expense for May.

Internal controls are the policies and procedures managers of a firm use to protect the firm's assets and to ensure the accuracy and reliability of the firm's accounting records.

The accounting rule which requires that only the business transactions of Team Shirts be shown on the balance sheet is the ________.

Beta Company reported the following information in its year ended December 31,2012 financials: 1.What were the company's total expenses? 2.How much of the company's profits have been kept by the company as of 1/1/12? 3.What is the balance of retained earnings at December 31,2012?

Internal controls are ________.

Discuss the qualities of accounting information.

Cash is ________.

Busy Beaver had revenues of $2,000,cost of goods sold of $780,advertising expense of $100,and interest expense of $25.Gross profit was ________.

Analyze each of the following transactions and determine the effect on the accounting equation. 1.Purchased three months' worth of prepaid advertising for $300. 2.Paid $500 cash on an account payable. 3.Paid $100 for supplies. 4.Performed $4,000 of services on account.

For information to be useful,it must be relevant and reliable.

Business: Whats It All About

Accruals and Deferrals: Timing Is Everything in Accounting

Payment for Goods and Services: Cash and Accounts Receivable

The Purchase and Sale of Inventory

Acquisition and Use of Long-Term Assets

Accounting for Liabilities

Accounting for Shareholders Equity

Preparing and Analyzing the Statement of Cash Flows

Using Financial Statement Analysis to Evaluate Firm Performance

Quality of Earnings, corporate Governance, and Ifrs

Filters

Exam 2: Qualities of Accounting Information

Accounts receivable represents ________.

Gross profit equals ________.

Comparability means that companies should use the same accounting rules from period to period.

Describe internal controls and discuss why internal controls are necessary for a business.

Financial statements may be prepared ________.

Detective controls include ________.

During May,Team Shirts spent $4,000 to buy 800 T-shirts and sold 300 of them for $15 each.Team Shirts should recognize ________ as expense for May.

Internal controls are the policies and procedures managers of a firm use to protect the firm's assets and to ensure the accuracy and reliability of the firm's accounting records.

The accounting rule which requires that only the business transactions of Team Shirts be shown on the balance sheet is the ________.

Beta Company reported the following information in its year ended December 31,2012 financials: 1.What were the company's total expenses? 2.How much of the company's profits have been kept by the company as of 1/1/12? 3.What is the balance of retained earnings at December 31,2012?

Internal controls are ________.

Discuss the qualities of accounting information.

Cash is ________.

Busy Beaver had revenues of $2,000,cost of goods sold of $780,advertising expense of $100,and interest expense of $25.Gross profit was ________.

Analyze each of the following transactions and determine the effect on the accounting equation. 1.Purchased three months' worth of prepaid advertising for $300. 2.Paid $500 cash on an account payable. 3.Paid $100 for supplies. 4.Performed $4,000 of services on account.

For information to be useful,it must be relevant and reliable.

Business: Whats It All About

Accruals and Deferrals: Timing Is Everything in Accounting

Payment for Goods and Services: Cash and Accounts Receivable

The Purchase and Sale of Inventory

Acquisition and Use of Long-Term Assets

Accounting for Liabilities

Accounting for Shareholders Equity

Preparing and Analyzing the Statement of Cash Flows

Using Financial Statement Analysis to Evaluate Firm Performance

Quality of Earnings, corporate Governance, and Ifrs

Filters