Question 1

The worksheet:

Accepted Answer

A) Is one of the basic financial statements. 
B) Is prepared throughout the year. 
C) Is not a formal step in the accounting cycle. 
D) Starts with the first column being the adjusted trial balance. 
A) Is one of the basic financial statements. 
B) Is prepared throughout the year. 
C) Is not a formal step in the accounting cycle. 
D) Starts with the first column being the adjusted trial balance.

Question 2

The current ratio equals current assets plus current liabilities.

Accepted Answer

A) True 
 B)False

Question 3

The normal order in which the financial statements are prepared is:

Accepted Answer

A) Balance sheet,income statement,statement of retained earnings. 
B) Income statement,statement of retained earnings,balance sheet. 
C) Income tax return,income statement,balance sheet. 
D) Income statement,statement of cash flows,balance sheet. 
A) Balance sheet,income statement,statement of retained earnings. 
B) Income statement,statement of retained earnings,balance sheet. 
C) Income tax return,income statement,balance sheet. 
D) Income statement,statement of cash flows,balance sheet.

Question 4

Accountants refer to the period of time from October 1 - December 31 as "busy season."

Accepted Answer

A) True 
 B)False

Question 5

If current assets are $110,000 and current liabilities are $50,000,working capital will be:

Accepted Answer

A) 45.5%. 
B) 2:2. 
C) $60,000. 
D) $160,000. 
A) 45.5%. 
B) 2:2. 
C) $60,000. 
D) $160,000.

Question 6

If Income Summary has a net credit balance,it signifies:

Accepted Answer

A) A net loss. 
B) Net income. 
C) A reduction of net worth. 
D) Dividends have been declared. 
A) A net loss. 
B) Net income. 
C) A reduction of net worth. 
D) Dividends have been declared.

Question 7

After all the closing entries have been posted,the Income Summary account has a zero balance.

Accepted Answer

A) True 
 B)False

Question 8

Retained Earnings at the end of a period:

Accepted Answer

A) Is equal to the balance in the Retained Earnings account in the adjusted trial balance at the end of a period. 
B) Is determined in the Statement of Retained Earnings. 
C) Is equal to Retained Earnings at the beginning of the period,minus net income (or plus net loss)for the period. 
D) Appears in the Income Statement for the period. 
A) Is equal to the balance in the Retained Earnings account in the adjusted trial balance at the end of a period. 
B) Is determined in the Statement of Retained Earnings. 
C) Is equal to Retained Earnings at the beginning of the period,minus net income (or plus net loss)for the period. 
D) Appears in the Income Statement for the period.

Question 9

Completion of worksheet--missing data
Certain data are given on the worksheet below,and certain missing data are indicated by the blank boxes.Sufficient information is included to fill in the missing data.Each account has a debit or credit balance characteristically normal for that kind of account.Note that the dollar amounts have been reduced to figures of not more than three digits to simplify the arithmetic.
Insert the figures necessary to complete the worksheet in the blanks indicated by an underline.The boxes cover both debit and credit columns; be sure to insert the missing figures in the correct column of the box.

Accepted Answer

The answer of Completion of worksheet--missing data
Certain data are given...

Question 10

The following information is available:   What is the return on equity? (round to the nearest number)

Accepted Answer

A) 5%. 
B) 20%. 
C) 25%. 
D) 15%. 
A) 5%. 
B) 20%. 
C) 25%. 
D) 15%.

Question 11

Adjustments and closing process--basic entries
Selected ledger accounts used by Goldstone Advertising Inc.,are listed along with identifying numbers.Following this list of account numbers and titles in a series of transactions,you are required to indicate the proper accounts to be debited and credited for each transaction.

Accepted Answer

The answer of Adjustments and closing process--basic entries
Selected ledger accounts...

Question 12

A revenue account is closed by debiting Income Summary and crediting Service Revenue.

Accepted Answer

A) True 
 B)False

Question 13

The December 31,2014 worksheet for Albertville Grill showed the following amounts related to the Depreciation Expense account: (a).In the Trial Balance debit column: $1,745
(b))In the Adjustments debit column: $1,125
(c))In the Adjusted Trial Balance debit column: $1,870
What is the proper balance in the Depreciation Expense account on January 1,2015,after all closing entries for 2014 have been posted,but before any 2015 transactions are recorded?

Accepted Answer

A) $1,870. 
B) $1,745. 
C) $0. 
D) $1,125. 
A) $1,870. 
B) $1,745. 
C) $0. 
D) $1,125.

Question 14

Assets are considered current assets if they are cash or will usually be converted into cash:

Accepted Answer

A) Within a month or less. 
B) Within 3 months. 
C) Within a year or less. 
D) Within 6 months or less. 
A) Within a month or less. 
B) Within 3 months. 
C) Within a year or less. 
D) Within 6 months or less.

Question 15

The dividends account should be:

Accepted Answer

A) Closed to income summary. 
B) Closed to retained earnings. 
C) Closed only if there is a profit. 
D) Not closed at all. 
A) Closed to income summary. 
B) Closed to retained earnings. 
C) Closed only if there is a profit. 
D) Not closed at all.

Question 16

Which account will not appear on an After-Closing Trial Balance?

Accepted Answer

A) Dividends. 
B) Prepaid Expenses. 
C) Unearned Revenue. 
D) Retained Earnings,at the end of the period. 
A) Dividends. 
B) Prepaid Expenses. 
C) Unearned Revenue. 
D) Retained Earnings,at the end of the period.

Question 17

The concept of adequate disclosure requires a company to inform financial statement users of each of the following,except:

Accepted Answer

A) The accounting methods in use. 
B) The due dates of major liabilities. 
C) Destruction of a large portion of the company's inventory on January 20,three weeks after the balance sheet date,but prior to issuance of the financial statements. 
D) Income projections for the next five years based upon anticipated market share of a new product; the new product was introduced a few days before the balance sheet date. 
A) The accounting methods in use. 
B) The due dates of major liabilities. 
C) Destruction of a large portion of the company's inventory on January 20,three weeks after the balance sheet date,but prior to issuance of the financial statements. 
D) Income projections for the next five years based upon anticipated market share of a new product; the new product was introduced a few days before the balance sheet date.

Question 18

A worksheet should be viewed as:

Accepted Answer

A) A financial statement to be distributed to investors. 
B) A financial statement to assist managers in making managerial decisions. 
C) A tool to assist accountants in making end-of-period adjustments and in preparing financial statements. 
D) A tool to assist auditors in determining that all transactions have been properly recorded throughout the period. 
A) A financial statement to be distributed to investors. 
B) A financial statement to assist managers in making managerial decisions. 
C) A tool to assist accountants in making end-of-period adjustments and in preparing financial statements. 
D) A tool to assist auditors in determining that all transactions have been properly recorded throughout the period.

Question 19

Publicly owned companies must file their audited financial statements and detailed supporting schedules with the Financial Accounting Standards Board.

Accepted Answer

A) True 
 B)False

Question 20

The income statement,statement of retained earnings,and the statement of cash flows can all be prepared directly from the adjusted trial balance.

Accepted Answer

A) True 
 B)False

Exam 5: The Accounting Cycle: Reporting Financial Results

The worksheet:

The current ratio equals current assets plus current liabilities.

The normal order in which the financial statements are prepared is:

Accountants refer to the period of time from October 1 - December 31 as "busy season."

If current assets are $110,000 and current liabilities are $50,000,working capital will be:

If Income Summary has a net credit balance,it signifies:

After all the closing entries have been posted,the Income Summary account has a zero balance.

Retained Earnings at the end of a period:

The following information is available: What is the return on equity? (round to the nearest number)

A revenue account is closed by debiting Income Summary and crediting Service Revenue.

Assets are considered current assets if they are cash or will usually be converted into cash:

The dividends account should be:

Which account will not appear on an After-Closing Trial Balance?

The concept of adequate disclosure requires a company to inform financial statement users of each of the following,except:

A worksheet should be viewed as:

Publicly owned companies must file their audited financial statements and detailed supporting schedules with the Financial Accounting Standards Board.

The income statement,statement of retained earnings,and the statement of cash flows can all be prepared directly from the adjusted trial balance.

Accounting: Information for Decision Making

Basic Financial Statements

The Accounting Cycle: Capturing Economic Events

The Accounting Cycle: Accruals and Deferrals

Merchandising Activities

Financial Assets

Inventories and the Cost of Goods Sold

Plant and Intangible Assets

Liabilities

Stockholders Equity: Paid-In Capital

Income and Changes in Retained Earnings

Statement of Cash Flows

Financial Statement Analysis

Global Business and Accounting

Management Accounting: a Business Partner

Job Order Cost Systems and Overhead Allocations

Process Costing

Costing and the Value Chain

Cost-Volume-Profit Analysis

Incremental Analysis

Responsibility Accounting and Transfer Pricing

Operational Budgeting

Standard Cost Systems

Rewarding Business Performance

Capital Budgeting

Forms of Business Organization

The Time Value of Money: Future Amounts and Present Values

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