Business Accounting Test
Bank
Course Introduction
Business Accounting provides a foundational understanding of financial and managerial accounting principles essential for effective business decision-making. The course covers key topics such as the accounting cycle, preparation and analysis of financial statements, and the use of accounting information in planning, controlling, and evaluating business operations. Students will gain practical skills in recording transactions, understanding accounting systems, interpreting financial data, and applying ethical standards in business practices. Through real-world examples and hands-on exercises, learners develop the competence to communicate financial information and contribute to strategic business objectives.
Recommended Textbook
Financial Accounting 4th Canadian Edition by Robert; Libby
Available Study Resources on Quizplus
13 Chapters
1686 Verified Questions
1686 Flashcards
Source URL: https://quizplus.com/study-set/3872
Page 2
Chapter 1: Financial Statements and Business Decisions
Available Study Resources on Quizplus for this Chatper
119 Verified Questions
119 Flashcards
Source URL: https://quizplus.com/quiz/77165
Sample Questions
Q1) Which of the following is true of financial accounting?
A)It provides information primarily for external decision makers.
B)It is required for corporations but probably would not be done by other business entities.
C)It provides information primarily for the use of managers of the company.
D)It has been practiced in this country for approximately the last 15 years.
Answer: A
Q2) A banker who is considering making a loan to a corporation would be one of the corporation's internal decision makers.
A)True
B)False
Answer: False
Q3) When a company ships products to a customer and bills the customer,the company should recognize revenue as earned.
A)True
B)False
Answer: True
To view all questions and flashcards with answers, click on the resource link above.
Page 3
Chapter 2: Investing and Financing Decisions and the Accounting System
Available Study Resources on Quizplus for this Chatper
100 Verified Questions
100 Flashcards
Source URL: https://quizplus.com/quiz/77160
Sample Questions
Q1) A T-account shows total debits of $25,000 and total credits of $22,000; therefore,it has a $3,000 credit balance.
A)True
B)False
Answer: False
Q2) Salida Company paid a note payable of $10,000 (interest had previously been paid).This transaction should be recorded as follows on the payment date.
A)Choice A
B)Choice B
C)Choice C
D)Choice D
Answer: C
Q3) If a company has assets of $60,000 and shareholders' equity of $30,000,then its liabilities must be $90,000.
A)True
B)False
Answer: False
To view all questions and flashcards with answers, click on the resource link above.
Page 4
Chapter 3: Operating Decisions and the Accounting System
Available Study Resources on Quizplus for this Chatper
110 Verified Questions
110 Flashcards
Source URL: https://quizplus.com/quiz/77159
Sample Questions
Q1) Cost of sales is usually the largest expense for manufacturing or merchandising companies.
A)True
B)False
Answer: True
Q2) According to the periodicity assumption,to measure and report financial information periodically,we assume the long life of the company can be cut into shorter periods.
A)True
B)False
Answer: True
Q3) The revenue principle recognizes revenue from the sale of goods when ownership passes from the seller to the buyer.In the sale of services,revenue is recognized when the services are completed.
A)True
B)False
Answer: True
To view all questions and flashcards with answers, click on the resource link above. Page 5
Chapter 4: Adjustments,financial Statements,and the Quality of Earnings
Available Study Resources on Quizplus for this Chatper
127 Verified Questions
127 Flashcards
Source URL: https://quizplus.com/quiz/77158
Sample Questions
Q1) On January 1,20B,the ledger of Global Corporation correctly showed supplies inventory of $500.During 20B,supplies purchases amounted to $700.A count (inventory)of supplies on hand at December 31,20B,showed $400.The 20B income statement should report supplies expense amounting to which of the following?
A)$700.
B)$800.
C)$1,100.
D)$1,200.
Q2) On October 1,20A,Ethan Company borrowed $10,000 on a 4-month note with an annual interest rate of 9 percent.How much interest expense should be reported for 20A,assuming that the note is paid on time and Ethan Company's accounting year coincides with the calendar year?
A)$-0-.
B)$225.
C)$300.
D)$900.
Q3) The unadjusted trial balance does not reflect adjusting entries.
A)True
B)False
Page 6
To view all questions and flashcards with answers, click on the resource link above.
Chapter 5: Communicating and Interpreting Accounting Information
Available Study Resources on Quizplus for this Chatper
108 Verified Questions
108 Flashcards
Source URL: https://quizplus.com/quiz/77157
Sample Questions
Q1) The net cash inflow or outflow for the year is the same amount as the increase or decrease in cash and cash equivalents for the year.
A)True
B)False
Q2) Which of the following is a cash inflow from financing activities?
A)proceeds from selling investments in equity securities of another company.
B)proceeds from selling equipment.
C)proceeds from issuance of bonds payable.
D)receipt of interest payments.
Q3) Very few companies use the direct method for disclosing their cash flows from operating activities.
A)True
B)False
Q4) Typical financing activities do NOT include the following:
A)Proceeds from issuance of short- and long-term borrowings.
B)Principal payments on short- and long-term borrowings.
C)Purchase of short- or long-term investments for cash.
D)Purchase of shares for retirement.
To view all questions and flashcards with answers, click on the resource link above. Page 7
Chapter 6: Reporting and Interpreting Sales Revenue, receivables, and Cash
Available Study Resources on Quizplus for this Chatper
135 Verified Questions
135 Flashcards
Source URL: https://quizplus.com/quiz/77156
Sample Questions
Q1) Which statement is false regarding the financial statements?
A)Current assets reported in the statement of financial position are generally reported in order of their liquidity.
B)Distributions to owners (dividends)are reported in the income statement.
C)Expenses on the income statement are reported as incurred,not as paid.
D)The statement of cash flows reports the sources and uses of cash during the accounting period.
Q2) The first footnote to the financial statements provides a summary of significant accounting policies.
A)True
B)False
Q3) Which of the following is an example of accumulated other comprehensive income?
A)rent revenue
B)interest income
C)unrealized gains or losses on security investments
D)loss on disposal of equipment
Q4) Gross margin (gross profit)is computed as sales revenue plus cost of goods sold.
A)True
B)False
8
To view all questions and flashcards with answers, click on the resource link above.
Chapter 7: Reporting and Interpreting Cost of Goods Sold and Inventory
Available Study Resources on Quizplus for this Chatper
161 Verified Questions
161 Flashcards
Source URL: https://quizplus.com/quiz/77155
Sample Questions
Q1) For most merchandisers and manufacturers,the required revenue recognition point is the time of shipment or delivery of goods.
A)True
B)False
Q2) When preparing the monthly bank reconciliation,the accountant for Teddy Trucks discovered that a cheque correctly written to one of Teddy's suppliers for $159 had been incorrectly recorded in the books as $195.To correct the error,the accountant prepared an adjusting entry which required a debit to which of the following accounts?
A)Cash.
B)Bad debt expense.
C)Accounts receivable.
D)Purchases.
Q3) A company had the following partial list of account balances at year-end: What amount of Net Sales would be shown on the income statement?
A)$55,700.
B)$56,000.
C)$57,200.
D)$64,200.
To view all questions and flashcards with answers, click on the resource link above. Page 9
Chapter 8: Reporting and Interpreting Property, plant, and Equipment; Intangibles; and Natural Resources
Available Study Resources on Quizplus for this Chatper
142 Verified Questions
142 Flashcards
Source URL: https://quizplus.com/quiz/77154
Sample Questions
Q1) A cost flow assumption need not match the physical flow of inventory.
A)True
B)False
Q2) Which one of the following statements concerning the periodic and perpetual inventory systems is true?
A)The periodic system uses a purchases account.
B)Inventory controls are only needed for the periodic inventory systems.
C)None of the accounting entries vary between the two systems.
D)Due to advances in computers,many businesses recently have begun to use the periodic inventory system.
Q3) Inventory is a tangible asset purchased for use in the company's operations.
A)True
B)False
Q4) The cost of goods sold account is which of the following?
A)an asset
B)a contra-asset
C)an extraordinary item
D)an expense
To view all questions and flashcards with answers, click on the resource link above. Page 10
Chapter 9: Reporting and Interpreting Liabilities
Available Study Resources on Quizplus for this Chatper
152 Verified Questions
152 Flashcards
Source URL: https://quizplus.com/quiz/77153
Sample Questions
Q1) FAL Corporation purchased a robot to be used in manufacturing.The purchase was made at the beginning of 20A by paying cash of $500,000.The robot has an estimated residual value of $20,000 and an expected useful life of 10 years.At the beginning of 20C,FAL concluded that the total useful life of the robot will be 8 years rather than 10,and that the residual value will be zero.FAL uses the straight-line method for depreciation. Required:
1.Make the journal entry to record depreciation on the robot for 20B.
2.Make the journal entry to record depreciation on the robot for 20C,including the effect of the changes in estimates.
3.Describe how a business should account for a change in the estimated useful life and/or residual value of a depreciable asset.
Q2) The book value of an operational asset initially declines less rapidly under the straight-line method than under the declining-balance method.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
11
Chapter 10: Reporting and Interpreting Bond Securities
Available Study Resources on Quizplus for this Chatper
111 Verified Questions
111 Flashcards
Source URL: https://quizplus.com/quiz/77164
Sample Questions
Q1) Shirlen Company has the following partial list of account balances at year end: Required:
A.Compute the current ratio.
B.Determine the amount of working capital.
C.Assume that cash is used to pay the balance due on trade payables.
1.Compute the new current ratio.
2.Compute the new amount of working capital.
D.Compute the trade payables turnover.
Q2) The matching principle requires that retirement benefit expenses be recorded in the year the employees receive the retirement checks.
A)True
B)False
Q3) Warner Company borrowed $25,000 cash on November 1,20A,and signed a six-month,12% interest-bearing note payable with interest payable at maturity.What is the amount of accrued interest payable that should be shown on the 20A statement of financial position?
A)$250
B)$300
C)$500
D)$750
To view all questions and flashcards with answers, click on the resource link above. Page 12
Chapter 11: Reporting and Interpreting Stockholders Equity
Available Study Resources on Quizplus for this Chatper
161 Verified Questions
161 Flashcards
Source URL: https://quizplus.com/quiz/77163
Sample Questions
Q1) A bond sold at a discount will pay total cash payments for interest that is more than the total interest expense recognized over the period the bond is issued.
A)True
B)False
Q2) A $500,000 bond was retired at 97 when the carrying amount of the bond was $495,000.The entry to record the retirement would include a
A)gain on bond redemption of $15,000.
B)loss on bond redemption of $10,000.
C)loss on bond redemption of $15,000.
D)gain on bond redemption of $10,000.
Q3) A high growth rate company may have a low times interest earned ratio because it has used debt to finance property,plant and equipment assets that are not yet generating a level of profits expected to materialize in the future.
A)True
B)False
Q4) A corporation cannot retire bonds before their maturity date.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above.
Page 13
Chapter 12: Statement of Cash Flows
Available Study Resources on Quizplus for this Chatper
136 Verified Questions
136 Flashcards
Source URL: https://quizplus.com/quiz/77162
Sample Questions
Q1) The dividend yield ratio is calculated by dividing the market price per share by dividends per share.
A)True
B)False
Q2) Legal capital serves as a "cushion" for investors.
A)True
B)False
Q3) Match the type of business with their characteristics below. Type of Business
A.Corporation
B.Partnership
C.Sole proprietorship
D.Partnership and sole proprietorship
Q4) Which one of the following is not a basic right of an owner of common share?
A)Participation in the corporation by voting in shareholder meetings.
B)Participation in the profits of the corporation through dividends declared by the board of directors.
C)Sharing in the responsibility of setting next year's budget.
D)Sharing in the distribution of assets of the corporation at liquidation.
To view all questions and flashcards with answers, click on the resource link above. Page 14
Chapter 13: Analyzing Financial Statements
Available Study Resources on Quizplus for this Chatper
124 Verified Questions
124 Flashcards
Source URL: https://quizplus.com/quiz/77161
Sample Questions
Q1) Calculate C Co's receivables turnover ratio and the days' sales in receivables for 2012.
A)11.43 times and 31.9 days
B)11.02 times and 33.1 days
C)11.15 times and 32.7 days
D)3.47 times and 105.2 days
Q2) Calculate C Co's return on assets (ROA)for 2012.
A)11.9%
B)13.0%
C)13.6%
D)17.7%
Q3) The price/earnings ratio is also referred to as which of the following?
A)Multiple.
B)Dividend yield ratio.
C)Book value per share.
D)Capitalization rate.
Q4) If an increase in ROA is the result of borrowing at high interest rates,investors could well interpret negative leverage as reflecting good news.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 15