Corporate Accounting Exam Bank
Course Introduction
Corporate Accounting is an essential course that focuses on the principles, standards, and practices of accounting as applied to corporate entities. It covers the preparation and analysis of financial statements, accounting for share capital, debentures, and dividends, as well as the treatment of profits and reserves. The course also delves into company amalgamations, reconstructions, and liquidations, equipping students with the knowledge to interpret complex corporate transactions. Emphasizing both regulatory frameworks and ethical considerations, the course prepares students to handle real-world accounting scenarios in corporate settings.
Recommended Textbook
Advanced Accounting Global 12th Edition by
Floyd A. Beams
Available Study Resources on Quizplus
23 Chapters
894 Verified Questions
894 Flashcards
Source URL: https://quizplus.com/study-set/3524
Page 2
Chapter 1: Business Combinations
Available Study Resources on Quizplus for this Chatper
36 Verified Questions
36 Flashcards
Source URL: https://quizplus.com/quiz/69981
Sample Questions
Q1) In the business combination of Polka and Spot,
A) all of the items listed above are treated as expenses.
B) all of the items listed above except the cost of registering and issuing the securities are included in the purchase price.
C) the costs of registering and issuing the securities are deducted from the fair market value of the common stock used to acquire Spot.
D) only the costs of closing duplicate facilities, the salaries of Polka's employees assigned to the merger, and the costs of the shareholders' meeting would be treated as expenses.
Answer: C
Q2) Historically, much of the controversy concerning accounting requirements for business combinations involved the ________ method.
A) purchase
B) pooling of interests
C) equity
D) acquisition
Answer: B
To view all questions and flashcards with answers, click on the resource link above. Page 3
Chapter 2: Stock Investments - Investor Accounting and Reporting
Available Study Resources on Quizplus for this Chatper
41 Verified Questions
41 Flashcards
Source URL: https://quizplus.com/quiz/69976
Sample Questions
Q1) Which one of the following statements is correct for an investor company?
A) The balance in the Investment in Osprey Co. account can be reduced to represent a decline in the fair market value of the investment, but will not be adjusted if the fair market value increases.
B) Under the equity method, the balance in the Investment in Osprey Co. account can be negative if the investee corporation operates at a loss.
C) Once the balance in the Investment in Osprey Co. is reduced to zero, it will not be reduced any further.
D) Under the equity method, the balance in the Investment in Osprey Co. account will increase when cash dividends are received.
Answer: C
Q2) Firms must conduct impairment tests more frequently than annually when A) other shareholders hold more than 50% interest.
B) a "more likely than not" expectation exists that a reporting unit will be sold or disposed of.
C) a specific unit does not have publicly traded stock.
D) using the equity method.
Answer: B
To view all questions and flashcards with answers, click on the resource link above. Page 4
Chapter 3: An Introduction to Consolidated Financial Statements
Available Study Resources on Quizplus for this Chatper
39 Verified Questions
39 Flashcards
Source URL: https://quizplus.com/quiz/69975
Sample Questions
Q1) A newly acquired subsidiary had pre-existing goodwill on its books. The parent company's consolidated balance sheet will
A) not show any value for the subsidiary's pre-existing goodwill.
B) treat the goodwill similarly to other intangible assets of the acquired company.
C) not show any value for the pre-existing goodwill unless all other assets of the subsidiary are stated at their full fair value.
D) always show the pre-existing goodwill of the subsidiary at its book value.
Answer: A
Q2) A subsidiary can be excluded from consolidation if
A) control does not rest with the majority owner.
B) the subsidiary is in legal reorganization.
C) the subsidiary is operating under severe foreign-exchange restrictions.
D) All of the above are correct.
Answer: D
To view all questions and flashcards with answers, click on the resource link above.
Chapter 4: Consolidated Techniques and Procedures
Available Study Resources on Quizplus for this Chatper
38 Verified Questions
38 Flashcards
Source URL: https://quizplus.com/quiz/69974
Sample Questions
Q1) When performing a consolidation, if the balance sheet does not balance, A) that indicates that the Investment in Subsidiary account on the parent's books should not be adjusted to -0-, because there is excess value represented in the investment.
B) it is frequently because of the noncontrolling interest, as these amounts do not appear on the separate companies' general ledgers.
C) the debit and credit totals of the adjusting/eliminating columns of the consolidation working paper should be checked to confirm that they balance, and if so, then there is no need to check the individual line items.
D) the amount that it is "off" will always equal the noncontrolling interest in the current year net income of the subsidiary.
Q2) What is the amount of total assets?
A) $1,380,000
B) $1,402,000
C) $1,470,000
D) $1,875,000
To view all questions and flashcards with answers, click on the resource link above.
Chapter 5: Intercompany Profit Transactions Inventories
Available Study Resources on Quizplus for this Chatper
40 Verified Questions
40 Flashcards
Source URL: https://quizplus.com/quiz/69973
Sample Questions
Q1) The 2014 consolidated income statement showed noncontrolling interest share of A) $3,200.
B) $6,400.
C) $8,800.
D) $12,000.
Q2) Psalm Enterprises owns 90% of the outstanding voting stock of Solomon Siding, which was purchased at a cost equal to 90% of the book value of Solomon's net assets many years ago. (At the time of purchase, the fair value and book value of Solomon's net assets were equal.) Psalm purchases merchandise from Solomon at 110% above Solomon's cost. In 2014, intercompany sales from Solomon to Psalm amounted to $362,000. Unrealized profits in Psalm's December 31, 2013 inventory and December 31, 2014 inventory were $82,000 and $26,000, respectively. Solomon reported net income of $980,000 for 2014.
Required:
1. Determine Psalm's income from Solomon for 2014.
2. In General Journal format, prepare consolidation working paper entries at December 31, 2014 to eliminate the effects of the intercompany inventory sales assuming the perpetual inventory method is used.
To view all questions and flashcards with answers, click on the resource link above. Page 7
Chapter 6: Intercompany Profit Transactions Plant Assets
Available Study Resources on Quizplus for this Chatper
39 Verified Questions
39 Flashcards
Source URL: https://quizplus.com/quiz/69972
Sample Questions
Q1) Pogo Corporation acquired a 75% interest in Sperry Corporation on January 1, 2011 at a cost equal to book value and fair value. In the same year Sperry sold land costing $25,000 to Pogo for $50,000. On July 1, 2014, Pogo sold the land to an unrelated party for $85,000. What was the gain on the sale of the land on the consolidated income statement for 2014?
A) $25,000
B) $35,000
C) $45,000
D) $60,000
Q2) In preparing the consolidated financial statements for 2014, the elimination entry for depreciation expense was a
A) debit for $5,000.
B) credit for $5,000.
C) debit for $15,000.
D) credit for $15,000.
Q3) The noncontrolling interest share for 2014 was
A) $18,000.
B) $22,000.
C) $23,000.
D) $27,000.
To view all questions and flashcards with answers, click on the resource link above. Page 8
Chapter 7: Intercompany Profit Transactions Bonds
Available Study Resources on Quizplus for this Chatper
40 Verified Questions
40 Flashcards
Source URL: https://quizplus.com/quiz/69971
Sample Questions
Q1) There are several theories for allocating constructive gains or losses between purchasing and issuing affiliates. The Agency Theory
A) does so based on the par value of the bonds purchased.
B) assigns the entire constructive gain or loss to the parent based on their control of the decision to purchase the bonds.
C) assigns the entire constructive gain or loss to the subsidiary based on the need to have the noncontrolling interest share in the retirement of the debt.
D) assigns the entire constructive gain or loss to whichever company issued the bonds.
Q2) What was the amount of gain or (loss) from the intercompany purchase of Plenty's bonds on January 2, 2014?
A) $(56,250)
B) $(75,000)
C) $ 75,000
D) $ 56,250
To view all questions and flashcards with answers, click on the resource link above. Page 9
Chapter 8: Consolidations - Changes in Ownership
Interests
Available Study Resources on Quizplus for this Chatper
37 Verified Questions
37 Flashcards
Source URL: https://quizplus.com/quiz/69970
Sample Questions
Q1) If SOS sold the additional shares directly to Great, Great's Investment in SOS account after the sale would be
A) $1,350,000.
B) $1,395,000.
C) $1,425,000.
D) $1,500,000.
Q2) At December 31, 2015 year-end, Lapwing Corporation's investment in Ground Inc. was $200,000 consisting of 80% of Ground's $250,000 stockholders' equity on that date. On April 1, 2016, Lapwing sold 20% interest (one-fourth of its holdings) in Ground for $65,000. During 2016, Ground had net income of $75,000(earned uniformly) and on July 1, 2016, Ground paid dividends of $40,000. Lapwing uses the equity method to account for the investment.
Required:
1. What is the gain or loss on sale of the 20% interest?
2. Record the journal entries for Lapwing for the year ending December 31, 2016. Use the actual-sale-date assumption.
To view all questions and flashcards with answers, click on the resource link above.
Page 10
Chapter 9: Indirect and Mutual Holdings
Available Study Resources on Quizplus for this Chatper
37 Verified Questions
37 Flashcards
Source URL: https://quizplus.com/quiz/69969
Sample Questions
Q1) Paglia Corporation owns 80% of Aburn Corporation and has separate net income of $200,000 for 2013. Aburn Corporation has separate net income of $100,000 and owns 70% of the outstanding stock of Badley Corporation. Badley Corporation has separate net income of $80,000. (Separate net incomes exclude investment income.) The cost of each investment was equal to book value and fair value. The controlling interest share of consolidated net income for 2013 is
A) $324,800.
B) $328,800.
C) $344,800.
D) $348,800.
Q2) Controlling interest share of consolidated net income for Paint Corporation and Subsidiaries is:
A) $234,800.
B) $244,800.
C) $260,000.
D) $270,000.
To view all questions and flashcards with answers, click on the resource link above.
Chapter 10: Subsidiary Preferred Stock,
Available Study Resources on Quizplus for this Chatper
36 Verified Questions
36 Flashcards
Source URL: https://quizplus.com/quiz/69991
Sample Questions
Q1) Assume a company's preferred stock is cumulative with a call provision and has dividends in arrears. The amount of stockholders' equity allocated to preferred stockholders is equal to the number of shares outstanding times the
A) sum of the par value per share plus any liquidation premium per share, plus the sum of any preferred dividends in arrears, plus the current year's dividend requirement, but only if dividends have been declared.
B) sum of the par value per share, plus any liquidation premium per share, plus the sum of any preferred dividends in arrears, plus the current year's dividend requirement, regardless of whether dividends have been declared.
C) call price plus the sum of any preferred dividends in arrears, plus the current year's dividend requirement, but only if dividends have been declared.
D) call price plus the sum of any preferred dividends in arrears, plus the current year's dividend requirement, regardless of whether dividends have been declared.
To view all questions and flashcards with answers, click on the resource link above. Page 12
Chapter 11: Consolidation Theories, Push-Down Accounting, and Corporate Joint Ventures
Available Study Resources on Quizplus for this Chatper
41 Verified Questions
41 Flashcards
Source URL: https://quizplus.com/quiz/69990
Sample Questions
Q1) Under the entity theory, a consolidated balance sheet prepared immediately after the business combination will show goodwill of
A) $15,000.
B) $22,500.
C) $25,000.
D) $32,500.
Q2) Assume the entity theory is used. On January 2, 2014, Leah Company will report Goodwill of ________ and Accounts Receivable of ________ on Leah's balance sheet.
A) $27,000; $30,000
B) $27,000; $34,500
C) $30,000; $30,000
D) $50,000; $35,000
Q3) Under parent company theory, the amount of consolidated net income is equal to the amount of ________ under entity theory.
A) noncontrolling interest share
B) noncontrolling interest income
C) income attributable to controlling stockholders
D) income attributable to noncontrolling stockholders
Page 13
To view all questions and flashcards with answers, click on the resource link above.
Chapter 12: Derivatives and Foreign Currency: Concepts and Common Transactions
Available Study Resources on Quizplus for this Chatper
40 Verified Questions
40 Flashcards
Source URL: https://quizplus.com/quiz/69989
Sample Questions
Q1) Gains or losses on foreign currency transactions are recorded before the related receivable or payable is settled when
A) the government cannot set an exchange rate for the foreign currency.
B) the foreign currency is unknown.
C) the fiscal year ends after the settlement of the receivable or payable.
D) the fiscal year ends before the settlement of the receivable or payable.
Q2) What is the final amount of the loan payable that Sooty repaid?
A) $250,000
B) $287,500
C) $397,500
D) $402,500
Q3) A direct quote for the U.S. dollar is given at $1.45 per 1 foreign currency unit (fcu). The respective indirect quote for the U.S. dollar would be reported as
A) 1.45 fcu = $1.00.
B) 1.45 fcu = $.6897.
C) .6897 fcu = $1.00.
D) 1.00 fcu = $1.45.
To view all questions and flashcards with answers, click on the resource link above.
Page 14
Chapter 13: Accounting for Derivatives and Hedging
Available Study Resources on Quizplus for this Chatper
40 Verified Questions
40 Flashcards
Source URL: https://quizplus.com/quiz/69988
Sample Questions
Q1) When a cash flow hedge is appropriate, the effective portion of the gain or loss on the derivative is
A) deferred using other comprehensive income.
B) recognized immediately at the time the agreement is made.
C) recognized over time, amortized over the period of the agreement.
D) recognized over time, offset by the fluctuation in the value of the hedged asset or liability.
Q2) Assuming a present value factor of 1 for simplicity, what is the fair value of this forward contract on December 31?
A) $160 asset
B) $160 liability
C) $140 asset
D) $140 liability
Q3) What is the fair value of the forward contract at March 1?
A) $-0-
B) $1,654.97 asset
C) $1,654.97 liability
D) $1,680 asset
To view all questions and flashcards with answers, click on the resource link above. Page 15
Chapter 14: Foreign Currency Financial Statements
Available Study Resources on Quizplus for this Chatper
39 Verified Questions
39 Flashcards
Source URL: https://quizplus.com/quiz/69987
Sample Questions
Q1) Exchange gains or losses from remeasurement appear
A) in the continuing operations section of the consolidated income statement.
B) as an extraordinary item on the consolidated income statement.
C) as other comprehensive income typically reported in a statement of stockholders' equity.
D) as an adjustment to the beginning balance of retained earnings on the consolidated Statement of retained earnings.
Q2) Which of the following assets and/or liabilities are considered monetary?
A) Intangible Assets and Plant, Property, and Equipment
B) Bonds Payable and Common Stock
C) Cash and Accounts Payable
D) Notes Receivable and Inventories carried at cost
Q3) Which of the following foreign subsidiary accounts will have the same value on consolidated financial statements, regardless of whether the statements are remeasured or translated?
A) Trademark
B) Deferred Income
C) Accounts Receivable
D) Goodwill
To view all questions and flashcards with answers, click on the resource link above.
Page 16
Chapter 15: Segment and Interim Financial Reporting
Available Study Resources on Quizplus for this Chatper
40 Verified Questions
40 Flashcards
Source URL: https://quizplus.com/quiz/69986
Sample Questions
Q1) Which of the following conditions would not indicate that two business segments should be classified as a single operating segment?
A) They have similar amounts of intersegment revenues or expenses.
B) They have a similar distribution method for products.
C) They have similar production processes.
D) They have similar products or services.
Q2) Sandpiper Corporation paid $120,000 for annual property taxes on January 15, 2014, and $20,000 for building repair costs on March 10, 2014. Total repair expenses for the year were estimated to be $200,000, and are normally accrued during the year until incurred. What total amount of expense for these items was reported in Sandpiper's first quarter 2014 interim income statement?
A) $ 50,000
B) $ 80,000
C) $100,000
D) $140,000
To view all questions and flashcards with answers, click on the resource link above.
17
Chapter 16: Partnerships - Formation, Operations, and Changes in Ownership Interests
Available Study Resources on Quizplus for this Chatper
40 Verified Questions
40 Flashcards
Source URL: https://quizplus.com/quiz/69985
Sample Questions
Q1) Austin contributes his computer equipment to the landscaping partnership he starts with Bentley. At what amount should the computer equipment be credited to Austin's partnership capital?
A) The tax basis
B) The fair value at the date of contribution
C) Austin's original cost
D) At the amount that Bentley contributes, with the assumption that they both contribute equally to the partnership
Q2) The XYZ partnership provides a 10% bonus to Partner Y that is based upon partnership income, after deduction of the bonus. If the partnership's income is $140,000, how much is Partner Y's bonus allocation?
A) $12,727
B) $13,860
C) $14,000
D) $15,400
To view all questions and flashcards with answers, click on the resource link above. Page 18
Chapter 17: Partnership Liquidation
Available Study Resources on Quizplus for this Chatper
40 Verified Questions
40 Flashcards
Source URL: https://quizplus.com/quiz/69984
Sample Questions
Q1) Using a safe payments schedule, how much cash should Melvin receive in the first distribution?
A) $ 81,000
B) $165,000
C) $168,600
D) $202,500
Q2) Creditors of the partnership may seek the personal assets of the partners to satisfy amounts owed. When this happens
A) creditors may only file against partnership assets.
B) creditors must file against all partners and recover their claims based on the individual partner's profit and loss distribution percentage.
C) creditors must file against all partners and recover their claims based on the individual partner's percentage ownership.
D) creditors may file against an individual partner to recover their claims, or against any combination of partners.
Q3) A cash distribution plan for the Sammi, Tammy, and Udd partnership was as follows:
To view all questions and flashcards with answers, click on the resource link above. Page 19
Chapter 18: Corporate Liquidations and Reorganizations
Available Study Resources on Quizplus for this Chatper
40 Verified Questions
40 Flashcards
Source URL: https://quizplus.com/quiz/69983
Sample Questions
Q1) A petition commencing a case against a corporate debtor
A) can be filed only under Chapter 7 of the bankruptcy act.
B) can be filed only under Chapter 11 of the bankruptcy act.
C) can be filed under either Chapter 7 or Chapter 11 of the bankruptcy act.
D) will be determined by the trustee whether it shall be Chapter 7 or Chapter 11 of the bankruptcy act.
Q2) An entity which qualified for fresh-start accounting is not required to disclose which of the following items in their initial financial statements?
A) Adjustments from historical cost of assets and liabilities
B) Amount of debt of the prior entity forgiven
C) Amount of ending retained earnings/deficit of the prior entity
D) Changes to the management team from the prior entity
Q3) Ohio Corporation is being liquidated under Chapter 7 of the Bankruptcy Act. The trustee has determined that the unsecured claims will receive $.05 on the dollar. Lender Bank holds a $100,000 mortgage note receivable from Ohio that is secured by equipment with a $120,000 book value and a $90,000 fair value, and a second mortgage on the same equipment amounting to $50,000.
To view all questions and flashcards with answers, click on the resource link above.
Page 20
Chapter 19: An Introduction to Accounting for State and Local Governmental Units
Available Study Resources on Quizplus for this Chatper
38 Verified Questions
38 Flashcards
Source URL: https://quizplus.com/quiz/69982
Sample Questions
Q1) For each of the following events or transactions, identify the type of fund(s) that will be affected.
1. A central purchasing department was established to handle all the purchasing needs of a county government.
2. A county government levies sales taxes restricted as to use for job creation.
3. A county government receives a large contribution specifying that income from the contribution be distributed each year to the county zoo. The principal is to remain intact indefinitely.
4. A city government paid construction costs of $12,000 on city hall building.
5. A city government paid general operating costs.
Q2) Centralized data processing, central motor pools and garages, centralized risk-financing activities, and central stores typically would be accounted for using what type of fund?
A) An agency fund
B) An enterprise fund
C) An internal service fund
D) A trust fund
To view all questions and flashcards with answers, click on the resource link above.
21
Chapter 20: Accounting for State and Local Governmental Units
- Governmental Funds
Available Study Resources on Quizplus for this Chatper
37 Verified Questions
37 Flashcards
Source URL: https://quizplus.com/quiz/69980
Sample Questions
Q1) Carson County had the following transactions for their General Fund relating to the levy and collection of property taxes.
1. Property tax bills for $1,000,000 are sent to property tax owners. Taxes are due in 45 days. History shows that Carson County should expect 1.5% of the property taxes to be uncollectible.
2. $850,000 in property taxes is collected. The remaining receivables are past due.
3. An additional $80,000 of the delinquent taxes is collected.
4. Wrote off $10,000 of delinquent taxes determined to be uncollectible.
Required:
Prepare the journal entries in the General Fund for the transactions.
Q2) Which of the following funds has similar accounting and reporting to the special revenue fund?
A) The proprietary fund
B) The trust fund
C) The general fund
D) The agency fund
To view all questions and flashcards with answers, click on the resource link above.
Chapter 21: Accounting for State and Local Governmental Units
- Proprietary and Fiduciary Funds
Available Study Resources on Quizplus for this Chatper
39 Verified Questions
39 Flashcards
Source URL: https://quizplus.com/quiz/69979
Sample Questions
Q1) Thoroughgood County has a municipal golf course and tennis club which is funded by the membership fees it charges. The club also has 6% bonds outstanding amounting to $20,000,000 on which it pays interest semi-annually. The club had the following transactions.
1. An addition to the golf clubhouse was added for $2,000,000, funded out of operations.
2. The following expenses were incurred and paid: $80,000 wages; $10,000 payroll taxes; $45,000 water bill; and $12,000 equipment repair.
3. Interest on the bonds was paid amounting to $600,000.
4. $5,000,000 of operating cash excess was repaid to the general fund for a previous loan.
5. Depreciation of $500,000 was recorded for the buildings.
Required:
Prepare the necessary journal entries for each of the above transactions for the Enterprise Fund.
To view all questions and flashcards with answers, click on the resource link above. Page 23
Chapter 22: Accounting for Not-For-Profit Organizations
Available Study Resources on Quizplus for this Chatper
39 Verified Questions
39 Flashcards
Source URL: https://quizplus.com/quiz/69978
Sample Questions
Q1) Which of the following is not true?
A) A not-for-profit entity operates for purposes other than to provide goods or services at a profit.
B) A not-for-profit entity may be governmental or non-governmental.
C) A not-for-profit entity may possess ownership interests like a corporation.
D) A not-for-profit entity receives resources from resource providers who do not expect commensurate or proportionate pecuniary return.
Q2) A donor gives a Voluntary Health and Welfare Organization(VHWO) $1,000 cash that is restricted for a research project. What account does the VHWO credit when the VHWO receives the money?
A) Nonoperating Revenue
B) Permanently Restricted Revenue
C) Unrestricted Support
D) Temporarily Restricted Support
Q3) In a nonprofit, nongovernmental hospital, courtesy allowances are
A) charity care services.
B) revenue deductions.
C) expenses.
D) revenues earned even if the standard charge is above or below the allowance.
To view all questions and flashcards with answers, click on the resource link above.
Page 24
Chapter 23: Estates and Trusts
Available Study Resources on Quizplus for this Chatper
38 Verified Questions
38 Flashcards
Source URL: https://quizplus.com/quiz/69977
Sample Questions
Q1) In reference to the Uniform Probate Code, which of the following statements is correct?
A) The Code entitles the surviving spouse to a homestead allowance that is exempt from, and has priority over, all claims against the estate.
B) The Code provides a homestead allowance to the surviving spouse of $100,000.
C) The Code provides an allowance for dependents, after other claims have been settled.
D) The Code entitles the surviving spouse to claim 100% of the estate after claims to third-parties are settled.
Q2) Under the Uniform Probate Code, the personal representative must publish for what time period a notice in a newspaper of general circulation in the county in which the decedent resided?
A) For one week
B) For two weeks
C) For three weeks
D) For five weeks
To view all questions and flashcards with answers, click on the resource link above.