Accounting Fundamentals Final Exam
Course Introduction
Accounting Fundamentals introduces students to the core principles and practices of accounting essential for understanding the financial aspects of business operations. Through a combination of theoretical concepts and practical exercises, the course covers topics such as the accounting cycle, recording transactions, preparing financial statements, and interpreting financial information. Students will develop foundational skills in analyzing business transactions, using accounting systems, and understanding the ethical considerations in accounting practices, providing a solid base for more advanced study in finance and business management.
Recommended Textbook
Financial Accounting 12th Edition by C. William Thomas
Available Study Resources on Quizplus
14 Chapters
2062 Verified Questions
2062 Flashcards
Source URL: https://quizplus.com/study-set/3740 Page 2
Chapter 1: The Financial Statements
Available Study Resources on Quizplus for this Chatper
191 Verified Questions
191 Flashcards
Source URL: https://quizplus.com/quiz/74557
Sample Questions
Q1) Relevance is one of the four enhancing qualitative characteristics.
A)True
B)False
Answer: False
Q2) Net income:
A)is calculated by subtracting total expenses and total dividends from total revenues.
B)occurs when total revenues are less than total expenses.
C)is often referred to as the "bottom line" on an income statement.
D)decreases total stockholders' equity.
Answer: C
Q3) Historical cost:
A)is used in the U.S.to value all business assets.
B)is equal to the amount of cash paid minus the dollar value of all noncash considerations also given in the exchange.
C)is a verifiable measure that is relatively free from bias.
D)is the amount that the business could sell an asset for.
Answer: C
Q4) Four ways a business can be organized include:
Answer: Proprietorship,Partnership,Limited-liability company,and Corporation
To view all questions and flashcards with answers, click on the resource link above. Page 3
Chapter 2: Transaction Analysis
Available Study Resources on Quizplus for this Chatper
196 Verified Questions
196 Flashcards
Source URL: https://quizplus.com/quiz/74556
Sample Questions
Q1) List and briefly discuss the three major components of stockholders' equity.
Answer: 1.Common stock - This shows the owners' investment in the corporation.
2.Retained earnings - This shows the cumulative net income earned by a company over its lifetime minus its cumulative net losses and dividends.
3.Dividends - This includes dividends declared by the board of directors during the accounting period.
Q2) What is the last step in the journalizing process?
A)Record the transaction in the journal.
B)Post the journal entry to the ledger.
C)Determine whether each account is increased or decreased by the transaction.
D)Specify each account affected by the transaction and classify each account by type.
Answer: A
Q3) The trial balance for James Corporation shows that the total debits equal the total credits.This indicates that all of the accounts are free from errors.
A)True
B)False
Answer: False
To view all questions and flashcards with answers, click on the resource link above.
4
Chapter 3: Accrual Accounting Income
Available Study Resources on Quizplus for this Chatper
223 Verified Questions
223 Flashcards
Source URL: https://quizplus.com/quiz/74555
Sample Questions
Q1) On December 31,2019,salaries owed to employees total $4,050.These will be paid on January 4,2020.An adjusted trial balance prepared on December 31,2019,includes which of the following?
A)Salaries Expense,$4,050 and Salaries Payable,$4,050
B)Salaries Payable,$4,050 and Unearned Salaries Revenue,$4,050
C)Unearned Salaries,$4,050
D)Unearned Salaries,$4,050 and Salaries Payable,$4,050
Answer: A
Q2) According to the joint new standard for revenue recognition,issued by FASB and IASB,which item below is NOT necessary?
A)Identify the contract with the customer.
B)Identify the separate performance obligations in the contract.
C)Allocate the transaction price to the separate performance obligations in the contract.
D)Recognize expenses as the entity satisfies the performance obligations.
Answer: D
Q3) The financial statements can be prepared from the adjusted trial balance.
A)True
B)False
Answer: True
To view all questions and flashcards with answers, click on the resource link above. Page 5
Chapter 4: Internal Control Cash
Available Study Resources on Quizplus for this Chatper
165 Verified Questions
165 Flashcards
Source URL: https://quizplus.com/quiz/74554
Sample Questions
Q1) Cash and Cash equivalents are assets.
A)True
B)False
Q2) In a bank reconciliation,a NSF check is:
A)added to the bank balance.
B)added to the book balance.
C)subtracted from the book balance.
D)subtracted from the bank balance.
Q3) Fraudulent financial reporting is also called:
A)the fraud triangle.
B)a misappropriation of assets.
C)cooking the books.
D)investigative reporting.
Q4) Deposits that have been recorded on the company's books,but have not yet been recorded by the bank are:
A)nonsufficient funds deposits.
B)outstanding deposits.
C)deposits in transit.
D)electronic funds deposits.
Q5) List the five internal control procedures.
To view all questions and flashcards with answers, click on the resource link above. Page 6
Chapter 5: Receivables and Revenue
Available Study Resources on Quizplus for this Chatper
156 Verified Questions
156 Flashcards
Source URL: https://quizplus.com/quiz/74553
Sample Questions
Q1) Under the allowance method,when a company determines that a specific customer's Accounts Receivable will not be collected,its accounting department will debit:
A)Uncollectible-Account Expense and credit Accounts Receivable.
B)Accounts Receivable and credit Allowance for Uncollectible Accounts.
C)Allowance for Uncollectible Accounts and credit Uncollectible Account Expense.
D)Allowance for Uncollectible Accounts and credit Accounts Receivable.
Q2) With regard to Accounts Receivable,a separate account for each customer is kept in a(n):
A)control account.
B)subsidiary ledger.
C)general ledger.
D)control ledger.
Q3) Emporium Bank lends money to a customer on a six month note.What journal entry does the bank prepare?
A)debit Note Receivable and credit Service Revenue
B)debit Cash and credit Note Payable
C)debit Note Receivable and credit Cash
D)debit Cash and credit Note Receivable
To view all questions and flashcards with answers, click on the resource link above.
Page 7
Chapter 6: Inventory Cost of Goods Sold
Available Study Resources on Quizplus for this Chatper
165 Verified Questions
165 Flashcards
Source URL: https://quizplus.com/quiz/74552
Sample Questions
Q1) A company purchased inventory for $1,300 per unit.The company later sold one unit of the inventory for cash of $1,900.Under the perpetual inventory system,which accounts will be debited to record the sale?
A)Cash,$1,900;Inventory,$1,300
B)Cash,$1,900;Cost of Goods Sold,$1,300
C)Cash,$1,900;Cost of Goods Sold,$600
D)Cash,$1,900;Inventory,$600
Q2) List three ways in which the gross profit method can be used by a retailer.
Q3) To document approval of purchase returns,the buyer issues a credit memorandum meaning that accounts payable are reduced for the amount of the return.
A)True
B)False
Q4) Two accounts that appear on the financial statements of a merchandising company but are NOT needed by a service company are:
A)cost of goods sold and depreciation.
B)cost of goods sold and net income.
C)cost of goods sold and inventory.
D)inventory and depreciation.
To view all questions and flashcards with answers, click on the resource link above.
Page 8
Chapter 7: Plant Assets, natural Resources, Intangibles
Available Study Resources on Quizplus for this Chatper
194 Verified Questions
194 Flashcards
Source URL: https://quizplus.com/quiz/74551
Sample Questions
Q1) When an intangible asset is amortized:
A)stockholders' equity decreases.
B)net income decreases.
C)net assets decrease.
D)all of the above are correct.
Q2) Expenditures that extend a plant asset's useful life should be capitalized.
A)True
B)False
Q3) What is the distinction between a capital expenditure (for a long-term asset)and an immediate expense?
Q4) Leasehold improvements are not subject to depreciation or amortization.
A)True
B)False
Q5) Major Company purchased equipment to be used in its distribution center.All of the following should be included in the cost of the equipment EXCEPT for:
A)insurance while in transit.
B)wages of workers who test the equipment before it is placed in service.
C)employee training costs before the equipment is placed in service.
D)insurance costs after the equipment is up and running.
To view all questions and flashcards with answers, click on the resource link above. Page 9
Chapter 8: Current and Contingent Liabilities
Available Study Resources on Quizplus for this Chatper
111 Verified Questions
111 Flashcards
Source URL: https://quizplus.com/quiz/74550
Sample Questions
Q1) Kathy's Corner Store has total cash sales for the month of $40,000 excluding sales taxes.If the sales tax rate is 5%,which journal entry is needed? (Ignore Cost of Goods Sold. )
A)debit Cash $42,000,credit Sales Revenue $42,000
B)debit Cash $40,000 and credit Sales Revenue $40,000
C)debit Cash $38,000,debit Sales Tax Receivable for $2,000 and credit Sales Revenue for $40,000
D)debit Cash $42,000,credit Sales Revenue $40,000 and credit Sales Tax Payable $2,000
Q2) On December 31,2019,Accrued Warranty Payable is reported on the balance sheet for White and Decker Company.The liability pertains to products sold,in 2019,with five-year warranties.The Accrued Warranty Payable should be reported on the balance sheet at December 31,2019 as a:
A)part of stockholders' equity.
B)long-term liability only.
C)current liability only.
D)current liability and a long-term liability.
Q3) An example of a contingent liability may be a lawsuit.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
Page 10
Chapter 9: Long-Term Liabilities
Available Study Resources on Quizplus for this Chatper
120 Verified Questions
120 Flashcards
Source URL: https://quizplus.com/quiz/74549
Sample Questions
Q1) The journal entry to record the conversion of bonds payable into common stock will include a:
A)debit to Bonds Payable and a credit to Common Stock.
B)debit to Bonds Payable and a credit to Cash.
C)debit to Cash and a credit to Common Stock.
D)debit to Cash and a credit to Paid-in Capital in Excess of Par.
Q2) The carrying amount of bonds is calculated by adding the balance of the Discount on Bonds Payable account to the balance in the Bonds Payable account.
A)True
B)False
Q3) On January 1,2019,Brewers Corporation issued $600,000 of 6%,5-year bonds at 99,with interest paid annually.Using the straight-line amortization method,what is the carrying value of the bonds on January 1,2019? (Round your final answer to the nearest dollar. )
A)$594,000
B)$606,061
C)$595,200
D)$636,000
To view all questions and flashcards with answers, click on the resource link above.
11
Chapter 10: Stockholders Equity
Available Study Resources on Quizplus for this Chatper
151 Verified Questions
151 Flashcards
Source URL: https://quizplus.com/quiz/74548
Sample Questions
Q1) List three reasons why corporations purchase their own stock.
Q2) The difference between the issue price per share of common stock and the par value per share of the stock is credited to:
A)Retained Earnings.
B)Common Stock.
C)Paid-in Capital in Excess of Par-Common.
D)Goodwill.
Q3) The payment of dividends will be reported on the statement of cash flows as a:
A)positive amount in the investing activities section.
B)negative amount in the investing activities section.
C)positive amount in the financing activities section.
D)negative amount in the financing activities section.
Q4) What is the formula for the price-earnings ratio? What does this ratio measure?
Q5) How does the declaration of a cash dividend affect the accounting equation?
A)increase to liabilities and a decrease to stockholders' equity
B)increase to liabilities and a decrease to assets
C)increase to assets and a decrease to liabilities
D)increase to stockholders' equity and a decrease to assets
To view all questions and flashcards with answers, click on the resource link above. Page 12
Chapter 11: The Statement of Cash Flows
Available Study Resources on Quizplus for this Chatper
146 Verified Questions
146 Flashcards
Source URL: https://quizplus.com/quiz/74547
Sample Questions
Q1) Collections on long-term loans are reported as investing activities on the statement of cash flows.
A)True B)False
Q2) Under the indirect method to prepare the statement of cash flows,depletion expense must be subtracted from net income when calculating Net cash provided by operating activities.
A)True
B)False
Q3) Financing activities on a statement of cash flows relate to:
A)current liabilities and long-term liabilities.
B)current assets and long-term assets.
C)long-term assets.
D)long-term liabilities and stockholders' equity.
Q4) Under the indirect method to prepare the statement of cash flows,a decrease in a current asset other than cash indicates a deduction from net income when calculating Net cash provided by operating activities.
A)True B)False
To view all questions and flashcards with answers, click on the resource link above. Page 13
Chapter 12: Financial Statement Analysis
Available Study Resources on Quizplus for this Chatper
120 Verified Questions
120 Flashcards
Source URL: https://quizplus.com/quiz/74546
Sample Questions
Q1) When computing trend percentages:
A)the current year is always equal to 100%.
B)the base year is always the current year.
C)the base year is always equal to 100%.
D)the base year is equal to the current year plus the previous year divided by two.
Q2) With regard to DuPont analysis,the leverage ratio measures:
A)the impact of equity financing on a company's profitability.
B)the impact of debt financing on a company's profitability.
C)the impact of leverage on a company's financial position.
D)the impact of equity financing on a company's financial position.
Q3) A knowledgeable investor tries to assess:
A)earnings quality.
B)accounts receivable.
C)accounts payable.
D)All of the above.
Q4) Accounting data should paint a picture of the results of implementing a particular business strategy by a company.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 14
Chapter 13: Investments
Available Study Resources on Quizplus for this Chatper
83 Verified Questions
83 Flashcards
Source URL: https://quizplus.com/quiz/74559
Sample Questions
Q1) At the beginning of the year,an investment in equity securities with insignificant influence was purchased for $400,000,and it has a fair value of $420,000 at the end of the year.The year-end journal entry will have a credit to:
A)Retained Earnings.
B)Unrealized Gain on Equity Securities.
C)Investment in Equity Securities.
D)Gain on Sale of Equity Securities.
Q2) A noncontrolling interest arises in all consolidations,regardless of the parent's level of ownership.
A)True
B)False
Q3) If 15% of the common stock of an investee company is purchased as a long-term investment,the appropriate method of accounting for the investment is:
A)the equity method.
B)the consolidation method.
C)the fair value method.
D)the lower of cost or market method.
To view all questions and flashcards with answers, click on the resource link above. Page 15
Chapter 14: Time Value of Money
Available Study Resources on Quizplus for this Chatper
41 Verified Questions
41 Flashcards
Source URL: https://quizplus.com/quiz/74558
Sample Questions
Q1) You have received a settlement offer from a restaurant for your medical expenses due to food poisoning.The restaurant will pay you $110,000 in one lump sum two years from now.You can earn 10% on your investments.The present value of $1 for 2 periods at 10% is 0.826.The present value of an ordinary annuity of $1 for 2 periods at 10% is 1.736.The present value of the settlement offer is closest to:
A)$220,000.
B)$110,000.
C)$190,960.
D)$90,860.
Q2) You are calculating the present value of $15,000 that you will receive at the end of every year for the next ten years.Which table will you use to obtain the present value of those $15,000 payments you will be receiving?
A)Present Value of $1 table
B)Future Value of $1 table
C)Present Value of Ordinary Annuity of $1 table
D)Future Value of Ordinary Annuity of $1 table
Q3) The interest paid on a bond is NOT an annuity because it occurs periodically.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
Page 16