Question 1

What distinguishes noncurrent assets from current assets?

Accepted Answer

The distinction is based on ti

Question 2

C-Swiss, a Swedish firm specializing in communication networks, reported a balance in Inventories of SEK21,500 million at the beginning of 2013 and SEK22,500 million at the end of 2013.During 2013, C-Swiss reported SEK114,100 million in Cost of Sales.How much was C-Swisss' inventory purchases during 2013? [Assume that all of C-Swisss' inventory purchases are made on account and C-Swiss applies IFRS, as well as reports its results in millions of Swedish kronor (SEK).]

Accepted Answer

A) SEK115,300 million 
B) SEK115,200 million 
C) SEK115,100 million 
D) SEK113,100 million 
E) none of the above 
A) SEK115,300 million 
B) SEK115,200 million 
C) SEK115,100 million 
D) SEK113,100 million 
E) none of the above

Question 3

Total liabilities plus shareholders' equity shows the sources of all the firm's financing, and the assets show how the firm holds or has invested those funds.

Accepted Answer

A) True 
 B)False

Question 4

Common terminology describes items whose cash receipts or payments the firm expects will occur within one year as current assets or current liabilities, respectively.

Accepted Answer

A) True 
 B)False

Question 5

Accounting does not normally recognize mutually unexecuted contracts as assets or liabilities.

Accepted Answer

A) True 
 B)False

Question 6

Prepare journal entries for each of the following unrelated transactions.You may omit explanations for the journal entries.

a.A firm issues 5,000 shares of $2 par value common stock in exchange for $20,000 cash.
b.A firm acquires a building with $30,000 cash and signs a 15-year note for $60,000.
c.A firm buys  inventory for $980 cash. 
d.A firm pays $8,000 to its landlord for annual rent.
e.A publisher sells $3,000 in magazine subscriptions that will be filled over the next 12 months.

Accepted Answer

a. Cash 20,000
Common Stock 10,000
Addit

Question 7

Noncurrent assets are expected to be converted to cash over

Accepted Answer

A) a month. 
B) a quarter. 
C) a half of a year. 
D) a year. 
E) a period of time greater than a year. 
A) a month. 
B) a quarter. 
C) a half of a year. 
D) a year. 
E) a period of time greater than a year.

Question 8

If the firm expects to collect or pay more than one year after the balance sheet date, the balance sheet classifies these as noncurrent assets and noncurrent liabilities, respectively.

Accepted Answer

A) True 
 B)False

Question 9

Complete the shareholders' equity section for each of the following independent situations.
 $\begin{array}{llll}&\text { CASE A }&\text { CASE B }&\text { CASE C }\
\text { Common stock, } 10,000 \text { shares } & \text { A } & \text { C } & \text { E } \
\text { Additional paid-in capital } & 25,000 & \text { D } & 30,000 \
\text { Retained earnings } & 45,000 & 25,000 & 20,000 \
\text { Total shareholders' equity } & 80,000 & 100,000 & \text { F } \
\text { Par value per share } & \text { B } & 1.50 & 2.50
\end{array}$

Accepted Answer

A.$10,000
B.$1.00
C.

Question 10

The amounts that firms report as received from owners are equal to the amounts the firm received when it originally issued the shares of stock.

Accepted Answer

A) True 
 B)False

Question 11

Accounting is governed by the balance sheet equation, which shows the equality of

Accepted Answer

A) assets with liabilities plus shareholders' equity. 
B) assets plus liabilities with shareholders' equity. 
C) assets plus shareholders' equity with liabilities. 
D) assets with liabilities minus shareholders' equity. 
E) assets with shareholders' equity minus liabilities. 
A) assets with liabilities plus shareholders' equity. 
B) assets plus liabilities with shareholders' equity. 
C) assets plus shareholders' equity with liabilities. 
D) assets with liabilities minus shareholders' equity. 
E) assets with shareholders' equity minus liabilities.

Question 12

Marianne Company reports the following: $\begin{array}{lr}
\text { Total Assets } & \$ 1,200 \
\text { Total Revenues } & \$ 800 \
\text { Total Liabilities } & \$ 500 \
\text { Beginning Retained Earnings } & \$ 200 \
\text { Total Expenses } & \$ 400 \
\text { Dividends } & \$ \quad 0
\end{array}$ What is Contributed Capital?

Accepted Answer

A) $300 
B) $200 
C) $100 
D) $0 
E) $400 
A) $300 
B) $200 
C) $100 
D) $0 
E) $400

Question 13

The closing process involves reducing to zero the balance in each income statement account by debiting the revenue accounts and crediting the expense accounts, and transferring to Retained Earnings the differences between total revenues and total expenses.

Accepted Answer

A) True 
 B)False

Question 14

Current assets are expected to be converted to cash within

Accepted Answer

A) a week. 
B) a month. 
C) a quarter. 
D) a year. 
E) two years. 
A) a week. 
B) a month. 
C) a quarter. 
D) a year. 
E) two years.

Question 15

Which of the following is/are true regarding T-accounts?

Accepted Answer

A) for each transaction, the amount entered on the left side of (or debited to) the accounts for each transaction equals the amount entered on the right side of (or credited to) the accounts. 
B) recording equal amounts of debits and credits for each transaction ensures that the balance sheet equation will always balance. 
C) one side of the space formed by the vertical line records increases in the item and the other side records decreases. 
D) all of the above 
E) none of the above 
A) for each transaction, the amount entered on the left side of (or debited to) the accounts for each transaction equals the amount entered on the right side of (or credited to) the accounts. 
B) recording equal amounts of debits and credits for each transaction ensures that the balance sheet equation will always balance. 
C) one side of the space formed by the vertical line records increases in the item and the other side records decreases. 
D) all of the above 
E) none of the above

What distinguishes noncurrent assets from current assets?

Total liabilities plus shareholders' equity shows the sources of all the firm's financing, and the assets show how the firm holds or has invested those funds.

Common terminology describes items whose cash receipts or payments the firm expects will occur within one year as current assets or current liabilities, respectively.

Accounting does not normally recognize mutually unexecuted contracts as assets or liabilities.

Noncurrent assets are expected to be converted to cash over

If the firm expects to collect or pay more than one year after the balance sheet date, the balance sheet classifies these as noncurrent assets and noncurrent liabilities, respectively.

The amounts that firms report as received from owners are equal to the amounts the firm received when it originally issued the shares of stock.

Accounting is governed by the balance sheet equation, which shows the equality of

Marianne Company reports the following: Total Assets \ 1,200 Total Revenues \ 800 Total Liabilities \ 500 Beginning Retained Earnings \ 200 Total Expenses \ 400 Dividends \ 0 What is Contributed Capital?

The closing process involves reducing to zero the balance in each income statement account by debiting the revenue accounts and crediting the expense accounts, and transferring to Retained Earnings the differences between total revenues and total expenses.

Current assets are expected to be converted to cash within

Which of the following is/are true regarding T-accounts?

Introduction to Business Activities and Overview of Financial Statements and the Reporting Process

The Basics of Record Keeping and Financial Statement Preparation: Income Statement

Balance Sheet: Presenting and Analyzing Resources and Financing

Income Statement: Reporting Results of Operating Activities

Statement of Cash Flows

Introduction to Financial Statement Analysis

Revenue Recognition, Receivables, and Advances From Customers

Working Capital

Long-Lived Tangible and Intangible Assets

Notes, Bonds, and Leases

Liabilities: Off-Balance Sheet Financing, Retirement Benefits, and Income Taxes

Marketable Securities and Derivatives

Intercorporate Investments in Common Stock

Shareholders Equity: Capital Contributions and Distributions

Statement of Cash Flows: Another Look

Synthesis and Extensions

Filters

Exam 2: The Basics of Record Keeping and Financial Statement Preparation: Balance Sheet

What distinguishes noncurrent assets from current assets?

Total liabilities plus shareholders' equity shows the sources of all the firm's financing, and the assets show how the firm holds or has invested those funds.

Common terminology describes items whose cash receipts or payments the firm expects will occur within one year as current assets or current liabilities, respectively.

Accounting does not normally recognize mutually unexecuted contracts as assets or liabilities.

Noncurrent assets are expected to be converted to cash over

If the firm expects to collect or pay more than one year after the balance sheet date, the balance sheet classifies these as noncurrent assets and noncurrent liabilities, respectively.

The amounts that firms report as received from owners are equal to the amounts the firm received when it originally issued the shares of stock.

Accounting is governed by the balance sheet equation, which shows the equality of

Marianne Company reports the following: Total Assets \ 1,200 Total Revenues \ 800 Total Liabilities \ 500 Beginning Retained Earnings \ 200 Total Expenses \ 400 Dividends \ 0 What is Contributed Capital?

The closing process involves reducing to zero the balance in each income statement account by debiting the revenue accounts and crediting the expense accounts, and transferring to Retained Earnings the differences between total revenues and total expenses.

Current assets are expected to be converted to cash within

Which of the following is/are true regarding T-accounts?

Introduction to Business Activities and Overview of Financial Statements and the Reporting Process

The Basics of Record Keeping and Financial Statement Preparation: Income Statement

Balance Sheet: Presenting and Analyzing Resources and Financing

Income Statement: Reporting Results of Operating Activities

Statement of Cash Flows

Introduction to Financial Statement Analysis

Revenue Recognition, Receivables, and Advances From Customers

Working Capital

Long-Lived Tangible and Intangible Assets

Notes, Bonds, and Leases

Liabilities: Off-Balance Sheet Financing, Retirement Benefits, and Income Taxes

Marketable Securities and Derivatives

Intercorporate Investments in Common Stock

Shareholders Equity: Capital Contributions and Distributions

Statement of Cash Flows: Another Look

Synthesis and Extensions

Filters