Business Accounting Final Exam
Course Introduction
Business Accounting introduces students to the fundamental principles and concepts of accounting as they apply to business organizations. The course covers the accounting cycle, including the recording, classification, and summary of business transactions, preparation of financial statements, and analysis of accounting information for decision-making. Students will learn about key topics such as assets, liabilities, equity, revenues, and expenses, as well as the regulatory environment and ethical considerations in accounting. Emphasis is placed on practical applications and the importance of accounting in supporting business strategy and operations.
Recommended Textbook
Cornerstones of Financial Accounting 3rd Edition by Jay Rich
Available Study Resources on Quizplus
14 Chapters
2651 Verified Questions
2651 Flashcards
Source URL: https://quizplus.com/study-set/3315
Page 2
Chapter 1: Accounting and the Financial Statements
Available Study Resources on Quizplus for this Chatper
239 Verified Questions
239 Flashcards
Source URL: https://quizplus.com/quiz/65788
Sample Questions
Q1) Net sales less cost of goods sold expense
Answer: C
Q2) ____________________ have claims to an entity's economic resources.
Answer: Creditors
Lenders
Investors
Stockholders
Q3) Refer to Baker's Pride Bakery. How much of the company is financed by owners at the end of December 2013?
Answer: The amount of financing by owners for 2013 is represented by the amount of stockholders' equity, $145,320. Over time, sales of stock and earnings retained by the company (cumulative net income minus cumulative dividends)cause the amount of stockholders' equity to increase.
Q4) Another term for Short Term Investments is
A)inventories.
B)accounts receivable.
C)contributed capital.
D)marketable securities.
Answer: D
To view all questions and flashcards with answers, click on the resource link above. Page 3
Chapter 2: The Accounting Information System
Available Study Resources on Quizplus for this Chatper
249 Verified Questions
249 Flashcards
Source URL: https://quizplus.com/quiz/65787
Sample Questions
Q1) Identify the transactions that the bookkeeper recorded incorrectly in the journal. Prepare the journal entry that the bookkeeper should have made for each transaction that you identify as being made incorrectly.
Answer: The May 11, 15, and 25 entries were recorded incorrectly. The correct entries are: 11ea7daa_2cb9_fc97_b9bd_836dc3b00f81_TB2047_00_TB2047_00
Q2) When a firm borrows money, one effect on the accounting equation is a(n)
A)decrease in contributed capital.
B)increase in assets.
C)decrease in liabilities.
D)decrease in assets.
Answer: B
Q3) A company follows the qualitative characteristic of consistency. This means that
A)For expenses, the company uses the same account names as used by its competitors.
B)The company has elected certain accounting principles that can never be changed.
C)The company applies the same accounting principles each period.
D)The company applies the same accounting principles as its competitors.
Answer: C
To view all questions and flashcards with answers, click on the resource link above.
Page 4
Chapter 3: Accrual Accounting
Available Study Resources on Quizplus for this Chatper
216 Verified Questions
216 Flashcards
Source URL: https://quizplus.com/quiz/65786
Sample Questions
Q1) What does the phrase, "Revenue is recognized when earned" mean?
A)Revenue is recorded in the accounting records when the goods are received from a supplier, and reported on the income statement when sold to the customer.
B)Revenue is recorded in the accounting records and reported on the income statement when the cash is received from the customer.
C)Revenue is recorded in the accounting records when the goods are sold to a customer, and reported on the income statement when the cash payment is received from the customer.
D)Revenue is recorded in the accounting records and reported on the income statement when goods are sold and delivered to a customer.
Answer: D
Q2) Inventory Answer: B
Q3) The ____________________ principle attempts to associate the revenue of the period with all costs necessary to generate that revenue.
Answer: matching
To view all questions and flashcards with answers, click on the resource link above. Page 5
Chapter 4: Internal Control and Cash
Available Study Resources on Quizplus for this Chatper
210 Verified Questions
210 Flashcards
Source URL: https://quizplus.com/quiz/65785
Sample Questions
Q1) A company's internal control system must be designed and maintained by its external auditors.
A)True
B)False
Q2) A credit memo appeared on the September bank statement. How should this amount be treated on the September bank reconciliation?
A)Add it to the company's balance.
B)Add it to the bank balance.
C)Deduct it from the company's balance.
D)Deduct it from the bank balance.
Q3) ____________________ are those investments and deposits with financial institutions that are readily convertible into known amounts of cash and that have original maturities of three months or less.
Q4) Collections of accounts receivable are considered to be cash equivalents.
A)True
B)False
Q5) All supporting documents attached to an invoice are canceled when the check is signed.
Q6) Segregation of duties
To view all questions and flashcards with answers, click on the resource link above. Page 6
Chapter 5: Sales and Receivables
Available Study Resources on Quizplus for this Chatper
158 Verified Questions
158 Flashcards
Source URL: https://quizplus.com/quiz/65784
Sample Questions
Q1) Results in an immediate electronic withdrawal from the owner's bank account when used.
Q2) Refer to Accelerated Solutions. If the aging method is used to estimate bad debts, what amount should be recorded as bad debt expense for 2013?
A)$50,000
B)$ 5,000
C)$15,000
D)$25,000
Q3) What should a company do to improve its accounts receivable turnover rate?
A)Lower its selling prices.
B)Increase its sales force.
C)Give customers credit terms of 2/10, n/30 rather than 1/10, n/30.
D)Reduce the number of employees working in the credit department.
Q4) Refer to Atlantis Tropicals. Assume that the net realizable value is $210,000 after the adjustment for bad debts in 2013. How much is the net realizable value of accounts receivable after a customer's account of $15,000 is written off? Explain why.
Q5) No service charge expense is incurred by the issuer when this card is used.
Q6) A contra-asset account.
Q7) A sales invoice that bears the notation 2/10 means ____________________.
To view all questions and flashcards with answers, click on the resource link above. Page 7
Chapter 6: Cost of Goods Sold and Inventory
Available Study Resources on Quizplus for this Chatper
238 Verified Questions
238 Flashcards
Source URL: https://quizplus.com/quiz/65783
Sample Questions
Q1) Refer to the information provided for Satoor, Inc. When did title to the merchandise transfer from the seller to the buyer?
A)July 7
B)July 10
C)July 15
D)Cannot be determined from the information provided.
Q2) Refer to the information provided for Satoor, Inc. Who is responsible for payment of the transportation costs on the merchandise sold?
A)seller
B)buyer
C)split equally between the two companies
D)Cannot be determined from the information provided.
Q3) Prices are rising; ending inventory is lower with this method.
Q4) Purchased merchandise on credit.
Q5) The inventory turnover ratio is defined as cost of goods sold divided by average inventory.
A)True
B)False
Q6) Invoice price paid for resale goods.
To view all questions and flashcards with answers, click on the resource link above. Page 8
Chapter 7: Operating Assets
Available Study Resources on Quizplus for this Chatper
193 Verified Questions
193 Flashcards
Source URL: https://quizplus.com/quiz/65782
Sample Questions
Q1) The reason some major intangible assets are not in the financial statements is because they cannot be measured.
A)True
B)False
Q2) Refer to Fantasy Cruise Lines. What will be the book value of the ship after 10 years?
A)$200,000
B)$400,000
C)$ 0
D)$100,000
Q3) Consist of the long-lived assets that are owned by a business
Q4) The accounting life of intangible assets is determined by
A)their legal lives.
B)their useful lives.
C)their legal lives or useful lives, whichever is shorter.
D)the tax life mandated by the IRS.
Q5) Research and development costs
Q6) This method minimizes taxable income
Q7) Explain what costs are included in the acquisition cost of operating assets.
Q8) Distinguish between current assets and operating assets.
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
187 Verified Questions
187 Flashcards
Source URL: https://quizplus.com/quiz/65781
Sample Questions
Q1) Refer to Georgia's Salon. On May 31, 2013, all but $1,500 of the gift cards had been redeemed for salon services. What is the impact on the accounting equation of recording the expired gift cards?
A)Assets and liabilities increase.
B)Assets and liabilities decrease.
C)Liabilities increase and stockholders' equity decreases.
D)Liabilities decrease and stockholders' equity increases.
Q2) During 2013, Going, Going, Gone sold 100 hot air balloons for $4,000 each. The balloons carry a 5-year warranty for defects. Estimates indicate that repair costs will average 4% of the total selling price. The estimated warranty liability at the beginning of the year was $42,000. $11,000 in claims was actually incurred during the year to honor their warranty. What was the balance in the estimated warranty liability at the end of the year?
A)$47,000
B)$42,000
C)$37,000
D)$ 5,000
Q3) Acceptable current ratios vary from industry to industry, but a general rule of thumb is that a current ratio greater than ____________________ is appropriate.
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
160 Verified Questions
160 Flashcards
Source URL: https://quizplus.com/quiz/65780
Sample Questions
Q1) A company issued $1,000,000 of 10% notes that resulted in interest expense of $100,000 per year. What is the company's net cash outflow if the effective tax rate is 40%?
A)$100,000
B)$ 60,000
C)$ 40,000
D)$160,000
Q2) A graphics design company issued bonds in the amount of $1,000,000 with a stated interest rate of 8%. If the interest is paid semiannually and the bonds are due in 10 years, what would be the total amount of interest paid over the life of the bonds?
A)$1,000,000
B)$400,000
C)$800,000
D)$80,000
Q3) The contract rate is also called the coupon or stated rate.
A)True
B)False
Q4) Occurs when a bond is issued for an amount that is less than the principal.
Q5) Obligations that extend beyond one year are referred to as
To view all questions and flashcards with answers, click on the resource link above. Page 11
Chapter 10: Stockholders Equity
Available Study Resources on Quizplus for this Chatper
242 Verified Questions
242 Flashcards
Source URL: https://quizplus.com/quiz/65779
Sample Questions
Q1) Authorized stock represents the
A)number of previously issued shares that have been repurchased by the corporation.
B)number of shares that the corporation has sold.
C)number of shares that are currently held by stockholders.
D)maximum number of shares that can be issued for each class of stock.
Q2) Both stock dividends and stock splits increase the number of a corporation's outstanding shares without altering the proportionate ownership of the corporation. A)True
B)False
Q3) Identify and describe the four primary rights for the owners of common stock.
Q4) An arbitrary monetary amount that has a stated value on each share of stock and establishes a minimum price for the stock when issued is the
Q5) When a corporation is in the process of being dissolved, any additional dividends are referred to as ____________________ dividends.
Q6) Represents the owners' claims against the assets of a corporation after all liabilities have been deducted.
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
206 Verified Questions
206 Flashcards
Source URL: https://quizplus.com/quiz/65778
Sample Questions
Q1) When using the indirect method to determine operating cash flows, how is the purchase of equipment for cash shown on the Statement of Cash Flows?
A)operating activity
B)investing activity
C)financing activity
D)noncash investing and financing activity
E)not reported on the statement of cash flows
Q2) An increase in retained earnings indicates that a cash dividend has been paid.
A)True
B)False
Q3) Declared cash dividends.
Q4) Recorded depreciation expenses for the year.
Q5) Measures the company's ability to meet its maturing debt obligations
Q6) The indirect method of preparing a statement of cash flows begins with net income and then adjusts it for noncash items to produce net cash flow from
Q7) Refer to Maritime Marine Services. What was the cost of the property, plant and equipment which was disposed of during 2014?
Q8) Sold office building for cash.
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
233 Verified Questions
233 Flashcards
Source URL: https://quizplus.com/quiz/65777
Sample Questions
Q1) Return on assets ratio
Q2) assess the likelihood that a company will be able to pay its current obligations as they come due.
Q3) Common size financial statements exclude the dollar amount as a relevant variable in the analysis, which makes comparison of one period with the next more meaningful.
A)True
B)False
Q4) Dividend yield ratio
Q5) Income from operations
Q6) Net profit margin percentage
Q7) Length of time required to collect the receivable from a credit sale.
Q8) Which of the following is a measure of liquidity?
A)operating cash flows ratio
B)earnings per share
C)accounts receivable turnover ratio
D)return on common equity
Q9) decomposes the return on equity ratio into margin, turnover, and leverage components.
Page 14
Q10) Interest expense
To view all questions and flashcards with answers, click on the resource link above.
Chapter 13: Investments
Available Study Resources on Quizplus for this Chatper
73 Verified Questions
73 Flashcards
Source URL: https://quizplus.com/quiz/65790
Sample Questions
Q1) The fair value method should be used to account for stock investments of less than 20% of the outstanding shares.
A)True
B)False
Q2) The excess of the investor's acquisition cost over the current value of the investee's identifiable net assets is recorded as an intangible asset called
Q3) Securities issued by a corporation as a form of ownership in the business, such as common stock and preferred stock, are called equity securities.
A)True
B)False
Q4) Which method of accounting for investments results in unrealized gains and losses because the investments must be marked to market?
A)equity method
B)amortized cost method
C)fair value method
D)trading method
Q5) Represents an ownership interest in a corporation, usually common stock
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
47 Verified Questions
47 Flashcards
Source URL: https://quizplus.com/quiz/65789
Sample Questions
Q1) Compound interest is a method of calculating the time value of money in which interest is earned on the previous periods' interest.
A)True
B)False
Q2) The Future Value is the amount to which an account may grow when interest is compounded.
A)True
B)False
Q3) Interest may only be charged to a borrower by a bank.
A)True
B)False
Q4) An investor expects to receive 10 payments of $5,000 each made at the end of each period. If interest is compounded at 5% annually, what is the future value of these payments?
A)$3,069.55
B)$7,387.30
C)$38,608.65
D)$62,889.45
Q5) Cash flows are described as either single cash flows or _______________.
To view all questions and flashcards with answers, click on the resource link above. Page 16