Question 1

Match between columns
                        Premises:  Long-lived assets
 Once-a-year accounting entries recorded on the first day of the fiscal period
 The ability to convert assets quickly into cash
 The firm's excess of its current assets over its current liabilities
 Excess of net sales over the cost of goods sold
 Excess of gross profit over operating expenses
 Sales minus the sum of sales returns and allowances and sales discounts
 Portrays a firm's ability to pay its short-term debts
 The classification that helps to identify which of the firm's debts are paid over a comparatively long period
 The final figure on the income statement

Accepted Answer

The Answer of Property and equipment and Reversing entries and is...

Question 2

The current ratio would probably be of most interest to

Accepted Answer

A)  creditors. 
B)  management. 
C)  the owner. 
D)  customers. 
E)  the Internal Revenue Service. 
A)  creditors. 
B)  management. 
C)  the owner. 
D)  customers. 
E)  the Internal Revenue Service.

Question 3

What are reversing entries? Which adjusting entries can be reversed?

Accepted Answer

Reversing entries are optional journal e

Question 4

On a classified balance sheet, wages payable is classified as:

Accepted Answer

A)  a current asset. 
B)  a general expense. 
C)  a long-term liability. 
D)  a current liability. 
E)  a revenue account. 
A)  a current asset. 
B)  a general expense. 
C)  a long-term liability. 
D)  a current liability. 
E)  a revenue account.

Question 5

A reversing entry could be used if

Accepted Answer

A)  there is an adjusting entry. 
B)  the adjusting entry increases an asset or liability account. 
C)  the adjusting entry account did not have a previous balance. 
D)  all of these were true. 
E)  none of these were true. 
A)  there is an adjusting entry. 
B)  the adjusting entry increases an asset or liability account. 
C)  the adjusting entry account did not have a previous balance. 
D)  all of these were true. 
E)  none of these were true.

Question 6

Match the terms below with the correct definitions.
-The final figure on the income statement

Accepted Answer

A) Property and equipment 
B) Reversing entries 
C) Gross profit 
D) Current ratio 
E) Working capital
F)Net income or net loss
G)Net sales
H)Income from operations
I)Long-term liabilities
J)Liquidity 
A) Property and equipment 
B) Reversing entries 
C) Gross profit 
D) Current ratio 
E) Working capital
F)Net income or net loss
G)Net sales
H)Income from operations
I)Long-term liabilities
J)Liquidity

Question 7

Which of the following entries is a general journal entry that is the exact opposite of a previously completed adjusting entry?

Accepted Answer

A)  A Closing Entry 
B)  A Working Adjustment 
C)  A Reversing Entry 
D)  A Temporary Entry 
A)  A Closing Entry 
B)  A Working Adjustment 
C)  A Reversing Entry 
D)  A Temporary Entry

Question 8

Notes receivable are written promises to pay an amount due to creditors.

Accepted Answer

A) True 
 B)False

Question 9

Cost of goods sold may be computed by

Accepted Answer

A)  adding beginning inventory and ending inventory together. 
B)  subtracting ending inventory from cost of goods available for sale. 
C)  subtracting beginning inventory from cost of goods available for sale. 
D)  adding beginning inventory to cost of goods available for sale. 
E)  subtracting beginning inventory from net purchases. 
A)  adding beginning inventory and ending inventory together. 
B)  subtracting ending inventory from cost of goods available for sale. 
C)  subtracting beginning inventory from cost of goods available for sale. 
D)  adding beginning inventory to cost of goods available for sale. 
E)  subtracting beginning inventory from net purchases.

Question 10

After the temporary accounts are closed, only the nominal accounts have balances.

Accepted Answer

A) True 
 B)False

Question 11

Define current ratio and how it is calculated, and explain the relationship between the two parts of the ratio resulting from the calculation.

Accepted Answer

Current ratio is a tool for determining

Question 12

In the work sheet of Parker Company, the current assets amount to $80,000, property and equipment is worth $150,000, current liabilities are $74,000, and long-term liabilities are $125,000. Which of the following is the current ratio of Parker Company? (Round to two decimal places.)

Accepted Answer

A)  1.08 
B)  1.16 
C)  0.95 
D)  0.85 
E)  1.21 
A)  1.08 
B)  1.16 
C)  0.95 
D)  0.85 
E)  1.21

Question 13

Cost of goods available for sale is equal to

Accepted Answer

A)  delivered cost of purchases minus Freight In. 
B)  delivered cost of purchases plus Freight In. 
C)  delivered cost of purchases plus beginning inventory. 
D)  delivered cost of purchases minus beginning inventory. 
E)  Freight In plus ending inventory. 
A)  delivered cost of purchases minus Freight In. 
B)  delivered cost of purchases plus Freight In. 
C)  delivered cost of purchases plus beginning inventory. 
D)  delivered cost of purchases minus beginning inventory. 
E)  Freight In plus ending inventory.

Question 14

What two measures tell management and short-term creditors if the firm has sufficient capital and can pay its debts?

Accepted Answer

A)  Working Capital Ratio 
B)  Current Ratio 
C)  Organizational Ratio 
D)  A & B 
A)  Working Capital Ratio 
B)  Current Ratio 
C)  Organizational Ratio 
D)  A & B

Question 15

Which of the following statements is true about a current ratio of 1.5?

Accepted Answer

A)  There is $1.50 of current assets available to pay every dollar of current debt. 
B)  There is $1.50 of owner's equity available to pay every dollar of total debt. 
C)  The current liabilities are to be repaid at 1.5 times their value. 
D)  The current liabilities are 1.5 times of current assets. 
A)  There is $1.50 of current assets available to pay every dollar of current debt. 
B)  There is $1.50 of owner's equity available to pay every dollar of total debt. 
C)  The current liabilities are to be repaid at 1.5 times their value. 
D)  The current liabilities are 1.5 times of current assets.

Question 16

Assume Net Sales are $225,000, Cost of Goods Sold is $75,000, Selling Expenses are $24,000 and General Expenses are $30,000. Calculate Net Income:

Accepted Answer

A)  $150,000 
B)  $126,000 
C)  $246,000 
D)  $96,000 
A)  $150,000 
B)  $126,000 
C)  $246,000 
D)  $96,000

Question 17

In the chart of accounts, account number 211 falls under the:

Accepted Answer

A)  Assets section. 
B)  Liabilities section. 
C)  Revenue section. 
D)  Cost of Goods Sold section. 
E)  Expenses section. 
A)  Assets section. 
B)  Liabilities section. 
C)  Revenue section. 
D)  Cost of Goods Sold section. 
E)  Expenses section.

Question 18

Net Income or Net Profit

Accepted Answer

A)  Are the same 
B)  Net Income is less than Net Profit 
C)  Net Profit is the profit before expenses are deducted 
D)  None of the above 
A)  Are the same 
B)  Net Income is less than Net Profit 
C)  Net Profit is the profit before expenses are deducted 
D)  None of the above

Question 19

A decrease in Sales Discounts results in a decrease in Net Income.

Accepted Answer

A) True 
 B)False

Question 20

The Purchases account is not classified as a selling expense.

Accepted Answer

A) True 
 B)False

The current ratio would probably be of most interest to

What are reversing entries? Which adjusting entries can be reversed?

On a classified balance sheet, wages payable is classified as:

A reversing entry could be used if

Match the terms below with the correct definitions. -The final figure on the income statement

Which of the following entries is a general journal entry that is the exact opposite of a previously completed adjusting entry?

Notes receivable are written promises to pay an amount due to creditors.

Cost of goods sold may be computed by

After the temporary accounts are closed, only the nominal accounts have balances.

Define current ratio and how it is calculated, and explain the relationship between the two parts of the ratio resulting from the calculation.

In the work sheet of Parker Company, the current assets amount to $80,000, property and equipment is worth $150,000, current liabilities are $74,000, and long-term liabilities are $125,000. Which of the following is the current ratio of Parker Company? (Round to two decimal places.)

Cost of goods available for sale is equal to

What two measures tell management and short-term creditors if the firm has sufficient capital and can pay its debts?

Which of the following statements is true about a current ratio of 1.5?

Assume Net Sales are $225,000, Cost of Goods Sold is $75,000, Selling Expenses are $24,000 and General Expenses are $30,000. Calculate Net Income:

In the chart of accounts, account number 211 falls under the:

Net Income or Net Profit

A decrease in Sales Discounts results in a decrease in Net Income.

The Purchases account is not classified as a selling expense.

Asset, Liability, Owners Equity, Revenue, and Expense Accounts

T Accounts, Debits and Credits, Trial Balance, and Financial Statements

The General Journal and the General Ledger

Adjusting Entries and the Work Sheet

Closing Entries and the Post-Closing Trial Balance

Bank Accounts, Cash Funds, and Internal Controls

Employee Earnings and Deductions

Employer Taxes, Payments, and Reports

Sales and Purchases

Cash Receipts and Cash Payments

Work Sheet and Adjusting Entries

Methods of Depreciation

Bad Debts

Inventory Methods

Notes Receivablenotes Payable

Filters

Exam 12: Financial Statements, Closing Entries, and Reversing Entries

The current ratio would probably be of most interest to

What are reversing entries? Which adjusting entries can be reversed?

On a classified balance sheet, wages payable is classified as:

A reversing entry could be used if

Match the terms below with the correct definitions. -The final figure on the income statement

Which of the following entries is a general journal entry that is the exact opposite of a previously completed adjusting entry?

Notes receivable are written promises to pay an amount due to creditors.

Cost of goods sold may be computed by

After the temporary accounts are closed, only the nominal accounts have balances.

Define current ratio and how it is calculated, and explain the relationship between the two parts of the ratio resulting from the calculation.

In the work sheet of Parker Company, the current assets amount to $80,000, property and equipment is worth $150,000, current liabilities are $74,000, and long-term liabilities are $125,000. Which of the following is the current ratio of Parker Company? (Round to two decimal places.)

Cost of goods available for sale is equal to

What two measures tell management and short-term creditors if the firm has sufficient capital and can pay its debts?

Which of the following statements is true about a current ratio of 1.5?

Assume Net Sales are $225,000, Cost of Goods Sold is $75,000, Selling Expenses are $24,000 and General Expenses are $30,000. Calculate Net Income:

In the chart of accounts, account number 211 falls under the:

Net Income or Net Profit

A decrease in Sales Discounts results in a decrease in Net Income.

The Purchases account is not classified as a selling expense.

Asset, Liability, Owners Equity, Revenue, and Expense Accounts

T Accounts, Debits and Credits, Trial Balance, and Financial Statements

The General Journal and the General Ledger

Adjusting Entries and the Work Sheet

Closing Entries and the Post-Closing Trial Balance

Bank Accounts, Cash Funds, and Internal Controls

Employee Earnings and Deductions

Employer Taxes, Payments, and Reports

Sales and Purchases

Cash Receipts and Cash Payments

Work Sheet and Adjusting Entries

Methods of Depreciation

Bad Debts

Inventory Methods

Notes Receivablenotes Payable

Filters