Accounting I Exam Preparation Guide
Course Introduction
Accounting I introduces students to the fundamental principles and concepts of accounting, focusing on the preparation and analysis of financial statements for sole proprietorships. Topics covered include the accounting cycle, journalizing and posting transactions, adjusting and closing entries, and the preparation of balance sheets and income statements. The course emphasizes the importance of accurate financial reporting, ethical considerations, and the role of accounting information in decision making. Students will develop foundational skills in recordkeeping and gain an understanding of how accounting supports business operations.
Recommended Textbook
Financial and Managerial Accounting 11th Edition by Carl
Available Study Resources on Quizplus
15 Chapters
2679 Verified Questions
2679 Flashcards
Source URL: https://quizplus.com/study-set/3939
Page 2
S. Warren
Chapter 1: Introduction to Accounting and Business
Available Study Resources on Quizplus for this Chatper
194 Verified Questions
194 Flashcards
Source URL: https://quizplus.com/quiz/78548
Sample Questions
Q1) Cash investments made by stockholders in exchange for capital stock in a business are reported on the statement of cash flows in the
A) financing activities section
B) investing activities section
C) operating activities section
D) supplemental statement
Answer: A
Q2) Some of the major fraudulent acts by senior executives started as what they considered to be small ethical lapses which grew out of control.
A)True
B)False
Answer: True
Q3) Match the following accounts to the financial statement where they can be found. (Hint: Some of the accounts can be found in more than one financial statement.)
Answer: 11ea9299_7e1d_4367_85c7_61194577234b_TB6235_00
Q4) Give the major disadvantage of disregarding the cost concept and constantly revaluing assets based on appraisals and opinions.
Answer: Accounting reports would become unstable and unreliable.
To view all questions and flashcards with answers, click on the resource link above.
3
Chapter 2: Analyzing Transactions
Available Study Resources on Quizplus for this Chatper
222 Verified Questions
222 Flashcards
Source URL: https://quizplus.com/quiz/78541
Sample Questions
Q1) On September 1st, Erika Company purchased land for $47,500 cash. Prepare the journal entry to record this transaction.
Answer: 11ea9299_7dcd_2824_85c7_f9f662f2f638_TB6235_00
Q2) Retained earnings will be reduced by the amount in the dividends account.
A)True
B)False
Answer: True
Q3) Revenue accounts are increased by credits.
A)True
B)False
Answer: True
Q4) Expenses follow the same debit and credit rules as A) revenues
B) dividends
C) capital stock
D) liabilities
Answer: B
Q5) Prepare a journal entry on March 27 for the payment of $8,000 in dividends.
Answer: 11ea9299_7dce_128e_85c7_01882ae826fa_TB6235_00
To view all questions and flashcards with answers, click on the resource link above. Page 4
Chapter 3: The Adjusting Process
Available Study Resources on Quizplus for this Chatper
179 Verified Questions
179 Flashcards
Source URL: https://quizplus.com/quiz/78540
Sample Questions
Q1) On January 2, Safe Boating Monthly received a check for $96 from a subscriber for a 12-month subscription. The January issue was mailed on January 15th. Prepare the necessary entries for the month of January.
Answer: 11ea9299_7dc5_11af_85c7_658a893e393a_TB6235_00 11ea9299_7dc5_38c0_85c7_b75807ea93e4_TB6235_00 The second entry can be made either on January 15th when the issue is mailed or on the 31st with other adjusting entries.
Q2) All of the following statements regarding vertical analysis are true except A) Vertical analysis may be prepared for several periods to analyze changes in relationships over time.
B) In a vertical analysis of a balance sheet, each asset item is stated as a percent of total assets.
C) In a vertical analysis of an income statement, each item is stated as a percent of total expenses.
D) Major differences between a company's vertical analysis and industry averages should be investigated.
Answer: C
To view all questions and flashcards with answers, click on the resource link above.
Page 5
Chapter 4: Completing the Accounting Cycle
Available Study Resources on Quizplus for this Chatper
196 Verified Questions
196 Flashcards
Source URL: https://quizplus.com/quiz/78539
Sample Questions
Q1) All companies must use a calendar year as their fiscal year.
A)True
B)False
Q2) The journal entry to close the Fees Earned, $275, and Rent Revenue, $200, accounts on December 31st during the closing process would be
A) Dec. 31 Fees Earned 275 Rent Revenue 200
Income Summary 475
B) Dec. 31 Income Summary 475 Fees Earned 275 Rent Revenue 200
C) Dec. 31 Revenues 475 Income Summary 475
D) Dec. 31 Income Summary 475 Revenues 475
Q3) The entry to close the appropriate insurance account at the end of the accounting period is
A) debit Income Summary; credit Prepaid Insurance
B) debit Prepaid Insurance; credit Income Summary
C) debit Insurance Expense; credit Income Summary
D) debit Income Summary; credit Insurance Expense
Q4) The closing process is sometimes referred to as closing the books.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 6
Chapter 5: Accounting for Merchandising Businesses
Available Study Resources on Quizplus for this Chatper
221 Verified Questions
221 Flashcards
Source URL: https://quizplus.com/quiz/78538
Sample Questions
Q1) Merchandise is sold for cash. The selling price of the merchandise is $3,000 and the sale is subject to a 7% state sales tax. The journal entry to record the sale would include
A) a debit to Cash for $3,000
B) a credit to Sales for $3,210
C) a credit to Sales Tax Payable for $210
D) none of these
Q2) If title to merchandise purchases passes to the buyer when the goods are shipped from the seller, the terms are
A) n/30
B) FOB shipping point
C) FOB destination
D) consigned
Q3) If the ownership of merchandise passes to the buyer when the seller delivers the merchandise for shipment, the terms are stated as FOB destination.
A)True
B)False
Q4) Selected accounts and amounts appear below. Journalize the closing entry, assuming a perpetual inventory system.
To view all questions and flashcards with answers, click on the resource link above.
Chapter 6: Inventories
Available Study Resources on Quizplus for this Chatper
167 Verified Questions
167 Flashcards
Source URL: https://quizplus.com/quiz/78537
Sample Questions
Q1) The three inventory costing methods will normally each yield different amounts of net income.
A)True
B)False
Q2) If merchandise inventory is being valued at cost and the purchase price is steadily falling, which method of costing will yield the largest net income?
A) average cost
B) LIFO
C) FIFO
D) weighted average
Q3) The inventory costing method that reports the most current prices in ending inventory is
A) FIFO
B) Specific identification
C) LIFO
D) Average cost
Q4) List three different security measures taken by stores to safeguard inventory.
To view all questions and flashcards with answers, click on the resource link above. Page 8
Chapter 7: Sarbanes-Oxley, Internal Control, and Cash
Available Study Resources on Quizplus for this Chatper
174 Verified Questions
174 Flashcards
Source URL: https://quizplus.com/quiz/78536
Sample Questions
Q1) Bank customers are considered creditors of the bank so the bank shows their accounts with credit balances on the bank's records.
A)True
B)False
Q2) Sarbanes-Oxley's purpose is to improve financial reporting.
A)True
B)False
Q3) The main reason that the bank statement cash balance and the company's cash balance do initially balance is due to timing differences.
A)True
B)False
Q4) Accompanying a bank statement for Marsh Land Properties is a credit memo for $15,475, representing the principal ($15,000) and interest ($475) on a note that had been collected by the bank. Marsh Land Properties had been notified by the bank at the time of collection, but had made no entries. Journalize the entry that should be made by Marsh Land to bring the accounting records up to date.
Q5) Distinguish preventive controls from detective controls and give examples of each as they relate to cash.
To view all questions and flashcards with answers, click on the resource link above.
Page 9
Chapter 8: Receivables
Available Study Resources on Quizplus for this Chatper
147 Verified Questions
147 Flashcards
Source URL: https://quizplus.com/quiz/78535
Sample Questions
Q1) The difference between the balance in Accounts Receivable and the balance in the Allowance for Doubtful Accounts is called the net realizable value.
A)True B)False
Q2) Of the two methods of accounting for uncollectible receivables, the allowance method provides in advance for uncollectible receivables.
A)True B)False
Q3) Harper Company lends Hewell Company $40,000 on March 1, accepting a four-month, 6% interest note. Harper Company prepares financial statements on March 31. What adjusting entry should be made before the financial statements can be prepared?
A) Cash 200 Interest Revenue 200
B) Interest Receivable 800 Interest Revenue 800
C) Interest Receivable 200 Interest Revenue 200
D) Note Receivable 40,000 Cash 40,000
Q4) When a note is written to settle an open account, no entry is necessary.
A)True B)False
To view all questions and flashcards with answers, click on the resource link above. Page 10
Chapter 9: Fixed Assets and Intangible Assets
Available Study Resources on Quizplus for this Chatper
175 Verified Questions
175 Flashcards
Source URL: https://quizplus.com/quiz/78534
Sample Questions
Q1) The depreciation method that does not use residual value in calculating the first year's depreciation expense is
A) straight-line
B) units-of-production
C) double-declining-balance
D) none of the above
Q2) The amount of depreciation expense for the first full year of use of a fixed asset costing $95,000, with an estimated residual value of $5,000 and a useful life of 5 years, is $19,000 by the straight-line method.
A)True
B)False
Q3) Expenditures that increase operating efficiency or capacity for the remaining useful life of a fixed asset are betterments.
A)True
B)False
Q4) Costs associated with normal research and development activities should be treated as intangible assets.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 11
Chapter 10: Current Liabilities and Payroll
Available Study Resources on Quizplus for this Chatper
172 Verified Questions
172 Flashcards
Source URL: https://quizplus.com/quiz/78547
Sample Questions
Q1) The employee earnings record would contain which column that the payroll register would probably not contain?
A) deductions
B) payment
C) earnings
D) cumulative earnings
Q2) The journal entry a company uses to record the issuance of a discounted note for the purpose of borrowing funds for the business is
A) debit Cash and Interest Expense; credit Notes Payable
B) debit Cash and Interest Payable; credit Notes Payable
C) debit Accounts Payable; credit Notes Payable
D) debit Notes Payable; credit Cash
Q3) Which of the following would most likely be classified as a current liability?
A) Two-year Notes Payable
B) Bonds Payable
C) Mortgage Payable
D) Unearned Rent
Q4) List five internal controls that relate directly to payroll.
To view all questions and flashcards with answers, click on the resource link above. Page 12
Chapter 11: Corporations: Organization, Stock Transactions, and Dividends
Available Study Resources on Quizplus for this Chatper
168 Verified Questions
168 Flashcards
Source URL: https://quizplus.com/quiz/78546
Sample Questions
Q1) On January 1, 2011 a company had the following data:
- issued 10,000 shares of $2.00 par value common stock for $12.00 per share
- issued 3,000 shares of $50 par value 6% cumulative preferred stock for $70 per share
- purchased 1,000 shares of previously issued common stock for $15.00 per share
The company had the following dividend information available:
2011 - No dividend paid
2012 - Paid a $2,000 total dividend
2013 - Paid a $17,000 total dividend
2014 - paid a $32,000 total dividend
Using the following format, fill in the correct values for each year;
2011 2012 2013 2014
Common stock dividend
Preferred stock dividend
Dividends in arrears
Q2) A 10% stock dividend will increase the number of shares outstanding but the book value per share will decrease.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 13
Chapter 12: Long-Term Liabilities: Bonds and Notes
Available Study Resources on Quizplus for this Chatper
181 Verified Questions
181 Flashcards
Source URL: https://quizplus.com/quiz/78545
Sample Questions
Q1) The amortization of a premium on bonds payable decreases bond interest expense.
A)True
B)False
Q2) On January 1, 2011, Gemstone Company obtained a $280,000, 10-year, 11% installment note from Guarantee Bank. The note requires annual payments of $47,544, with the first payment occurring on the last day of the fiscal year. The first payment consists of interest of $30,800 and principal repayment of $16,744. The journal entry to record the payment of the first annual amount due on the note would include:
A) a credit to cash of $16,744
B) a credit to Interest Payable of $30,800
C) a debit to Notes Payable of $16,744
D) a debit to Interest Expense of $47,544
Q3) Bonds Payable has a balance of $1,000,000 and Discount on Bonds Payable has a balance of $15,000. If the issuing corporation redeems the bonds at 97.5, what is the amount of gain or loss on redemption?
A) $10,000 loss
B) $25,000 loss
C) $25,000 gain
D) $10,000 gain
To view all questions and flashcards with answers, click on the resource link above.
Page 14
Chapter 13: Investments and Fair Value Accounting
Available Study Resources on Quizplus for this Chatper
137 Verified Questions
137 Flashcards
Source URL: https://quizplus.com/quiz/78544
Sample Questions
Q1) If one company owns more than 50% of the common stock of another company
A) a partnership exists.
B) a parent-subsidiary relationship exists.
C) the company whose stock is owned must be liquidated
D) the cost method should be used to account for the investment.
Q2) Held-to-maturity securities are reported on the balance sheet at fair market value.
A)True
B)False
Q3) On June 1, $40,000 of treasury bonds were purchased between interest dates. The broker commission was $600. The bonds pay interest at 12%, which is paid semiannually on January 1 and July 1. How much interest revenue will be recorded on July 1?
A) $400
B) $406
C) $2,000
D) $2,400
Q4) Trading securities are reported on the balance sheet at cost.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
15
Chapter 14: Statement of Cash Flows
Available Study Resources on Quizplus for this Chatper
162 Verified Questions
162 Flashcards
Source URL: https://quizplus.com/quiz/78543
Sample Questions
Q1) Accounts receivable resulting from sales to customers amounted to $40,000 and $31,000 at the beginning and end of the year, respectively. Income reported on the income statement for the year was $120,000. Exclusive of the effect of other adjustments, the cash flows from operating activities to be reported on the statement of cash flows is
A) $120,000.
B) $129,000.
C) $151,000.
D) $111,000.
Q2) Accounts receivable from sales transactions were $44,000 at the beginning of the year and $53,000 at the end of the year. Net income reported on the income statement for the year was $105,000. Exclusive of the effect of other adjustments, the cash flows from operating activities to be reported on the statement of cash flows prepared by the indirect method is
A) $105,000
B) $114,000
C) $96,000
D) $158,000
To view all questions and flashcards with answers, click on the resource link above. Page 16
Chapter 15: Financial Statement Analysis
Available Study Resources on Quizplus for this Chatper
184 Verified Questions
184 Flashcards
Source URL: https://quizplus.com/quiz/78542
Sample Questions
Q1) A company with $60,000 in current assets and $40,000 in current liabilities pays a $1,000 current liability. As a result of this transaction, the current ratio and working capital will
A) both decrease.
B) both increase.
C) increase and remain the same, respectively.
D) remain the same and decrease, respectively.
Q2) Corporate annual reports typically do not contain which of the following?
A) management discussion and analysis
B) SEC statement expressing an opinion
C) accompanying foot notes
D) auditor's report
Q3) If a company has issued only one class of stock, the earnings per share are determined by dividing net income plus interest expense by the number of shares outstanding.
A)True
B)False
Q4) In horizontal analysis, the current year is the base year.
A)True
B)False
Page 17
To view all questions and flashcards with answers, click on the resource link above.