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devry acct304 final exam




Question;acct304 final exam;Question 1.1. (TCO 1) The SEC issues accounting standards in;the form of (Points: 6);accounting;research bulletins.;financial;reporting releases.;financial;accounting standards.;financial technical bulletins.;Question 2.2. (TCO 1) When a registrant company submits its;annual filing to the SEC, it uses (Points: 6);Form 10-A.;Form 10-K.;Form 10-Q.;Form S-1.;Question 3.3. (TCO 2) The conceptual framework's qualitative;characteristic of relevance includes (Points: 6);predictive;value.;verifiability.;completeness.;neutrality.;Question 4.4. (TCO 2) Enhancing qualitative characteristics;of accounting information include each of the following, except (Points: 6);timeliness.;materiality.;comparability.;verifiability.;Question 5.5. (TCO 3) A sale on account would be recorded by;(Points: 6);debiting;revenue.;crediting;assets.;crediting;liabilities.;debiting;assets.;Question 6.6. (TCO 3) Prepayments occur when (Points: 6);cash flow;precedes expense recognition.;sales are;delayed pending credit approval.;customers are;unable to pay the full amount due when goods are delivered.;manufactured;goods await quality control inspections.;Question 7.7. (TCO 4) An asset that is not expected to be;converted to cash or consumed within 1 year or the operating cycle is (Points;6);goodwill.;accounts;receivable.;inventory.;supplies.;Question 8.8. (TCO 4) Which of the following is never a;current liability account? (Points: 6);Accrued;payroll;Dividends;payable;Prepaid rent;Subscriptions;collected in advance;Question 9.9. (TCO 5) The distinction between operating and;nonoperating income relates to (Points: 6);continuity of;income.;principal;activities of the reporting entity.;consistency of;income stream.;reliability of;measurements.;Question 10.10. (TCO 5) On May 1, Foxtrot Co. agreed to sell;the assets of its Footwear Division to Albanese Inc. for $80 million. The sale;was completed on December 31, 2012. The following additional facts pertain to;the transaction;The Footwear Division qualifies as a component of the;entity, according to GAAP, regarding discontinued operations.;The book value of Footwear's assets totaled $48 million on;the date of the sale.;Footwear's operating income was a pre-tax loss of $10;million in 2012.;Foxtrot's income tax rate is 40%.;In the 2012 income statement for Foxtrot Co., it would;report;(Points: 6);income (loss);on its total operations for the year without separation.;income (loss);on its continuing operation only.;income (loss);from its continuing and discontinued operations separately.;income and;gains separately from losses.;Question 11.11. (TCO 5) Operating cash outflows would;include (Points: 6);purchase of;investments.;purchase of;equipment.;payment of;cash dividends.;purchases of;inventory.;Question 12.12. (TCO 5) The FASB's stated preference for;reporting operating cash flows is the (Points: 6);indirect;method.;direct method.;working;capital method.;all financial;resources method.;Question 13.13. (TCO 5) Merchandise sold FOB shipping point;indicates that (Points: 6);the seller;pays the freight.;the buyer;holds title after the merchandise leaves the seller's location.;the common;carrier holds title until the merchandise is delivered.;the sale is;not consummated until the merchandise reaches the point to which it is being;shipped.;Question 14.14. (TCO 5) Todd Sweeney is an artist who sells;his work under consignment. (He displays his work in local barbershops, and;customers buy the work there.) Sweeney recently transferred a painting to a;local barbershop. After Sweeney has transferred a painting to a barbershop, the;painting (Points: 6);should be;counted in Sweeney's inventory until the barbershop sells it.;should be;counted in the barbershop's inventory, as they now possess it.;should be;counted in either Sweeney's or the barbershop's inventory, depending on which;incurred the cost of preparing the painting for display.;None of the;above;Question 15.15. (TCO 6) Reba wishes to know how much money;would be in her savings account if she deposits a given sum in an account and;leaves it there at 6% interest for 5 years. She should use a table for the;(Points: 6);future value;of an ordinary annuity of 1.;future value;of 1.;future value;of an annuity of 1.;present value;of an annuity due of 1.;Question 16.16. (TCO 6) Loan A has the same original;principal, interest rate, and payment amount as Loan B. However, Loan A is;structured as an annuity due, while Loan B is structured as an ordinary;annuity. The maturity date of Loan A will be (Points: 6);earlier than;Loan B.;later than;Loan B.;the same as;Loan B.;indeterminate;with respect to Loan B.;Question 17.17. (TCO 7) Compensating balances represent;(Points: 6);funds in a;bank account that cannot be spent.;balances in a;payroll checking account.;accounts that;are subject to bank service charges.;accounts on;which banks pay interest, such as NOW accounts.;Question 18.18. (TCO 7) Oswego Clay Pipe Company sold;$46,000 of pipe to Southeast Water District #45 on April 12 of the current year;with terms 1/15, n/60. Oswego uses the gross method of accounting for cash;discounts. What entry would Oswego make on April 23, assuming the customer made;the correct payment on that date?;(Points: 6);Option a;Option b;Option c;Option d;Question 19.19. (TCO 8) In a periodic inventory system, the;cost of purchases is debited to (Points: 6);purchases.;cost of goods;sold.;inventory.;accounts;payable.;Question 20.20. (TCO 8) During periods when costs are rising;and inventory quantities are stable, cost of goods sold will be (Points: 6);higher under;FIFO than LIFO.;higher under;FIFO than average cost.;lower under;average cost than LIFO.;lower under;LIFO than FIFO.;Question 21.21. (TCO 8) In applying LCM, market cannot be;(Points: 6);less than net;realizable value.;greater than;the normal profit.;less than the;normal profit margin.;greater than;net realizable value.;Question 22.22. (TCO 8) In calculating the cost-to-retail;percentage for the retail method, the retail column will not include (Points;6);purchases.;purchase;returns.;abnormal shortages.;freight-in.;Question 1. 1. (TCO 8) Fulbright Corp. uses the periodic;inventory system. During its first year of operation, Fulbright made the;following purchases (listed in chronological order of acquisition);? 40 units at $100;? 70 units at $80;? 170 units at $60;Sales for the year totaled 270 units, leaving 10 units on;hand at the end of the year. What is the ending inventory using the average;cost method (rounded)? (Points: 15);Question 2. 2. (TCO 5) Describe what is meant by unearned;revenues, and give two examples. (Points: 28);Question 3. 3. (TCO 7) Briefly compare and contrast the two;allowance estimation approaches to estimating bad debt expense. In your answer;indicate which approach, if either, is superior and explain your;reasoning. (Points: 25);1. (TCO 8);Briefly explain when there would be a tax benefit from electing LIFO rather;than FIFO. (Points: 25);Question 2. 2. (TCO 4) You are the independent accountant;assigned to the audit of Neophyte Company. The company's accountant, a graduate;of Rival State University, has prepared financial statements that contained the;following questionable items;a. The balance sheet reports land at $100,000. Included in;this amount is a piece of property held for speculation at a cost of $30,000.;b. Current liabilities include $50,000 for long-term debt;that comes due in 3 months. The company has received a suitable firm commitment;to refinance the debt for 5 years and intends to do so.;c. Long-term Investments (non-current) in marketable;securities include $20,000 in short-term, high-grade commercial paper.;Please discuss how the above items should be correctly;classified and accounted for. (Points: 25)


Paper#58338 | Written in 18-Jul-2015

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