Intermediate Accounting Final Exam
Course Introduction
Intermediate Accounting delves into the principles and practices underlying the preparation and interpretation of financial statements, building upon foundational accounting knowledge. The course emphasizes the application of generally accepted accounting principles (GAAP) with a detailed study of assets, liabilities, and equity measurement and reporting. Topics include revenue recognition, inventory valuation, long-term assets, current and long-term liabilities, and stockholders equity. Students will analyze complex accounting issues, apply critical thinking to resolve ambiguities, and develop skills necessary for financial reporting and analysis in accordance with relevant accounting standards.
Recommended Textbook
Horngren's Financial and Managerial Accounting The Managerial Chapters 6th Edition by Tracie
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Chapter 15: Accounting Information Systems
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Sample Questions
Q1) The accounts payable subsidiary ledger lists each vendor along with amounts paid to the vendors and the remaining amounts owed to them.
A)True B)False
Q2) Describe the transactions recorded in the cash payments journal.
Q3) Sales on account are recorded in a cash receipts journal.
A)True
B)False
Q4) A subsidiary ledger is ________.
A)an accounting journal designed to record a specific type of transaction
B)a created list of accounts used by a business entity to define each class of items for which cash is spent or received
C)a complete record of business transactions recorded in a ledger over the life of a company
D)a record of accounts that provide supporting details on individual balances,the total of which appears in a general ledger account
Q5) A source document provides the evidence and data for accounting transactions. A)True B)False
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Chapter 16: Introduction to Managerial Accounting
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230 Flashcards
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Sample Questions
Q1) Managerial accounting is used in manufacturing and merchandising companies,but not in service companies.
A)True
B)False
Q2) Belstone,Inc.is a merchandiser of stone ornaments.It sold 15,000 units during the year.The company has provided the following information: \[\begin{array} { | l | r | }
\hline \text { Sales Revenue } & \$ 525,000 \\
\hline \text { Purchases (excluding Freight In) } & 347,000 \\
\hline \text { Selling and Administrative Expenses } & 36,500 \\
\hline \text { Freight In } & 15,500 \\
\hline \text { Beginning Merchandise Inventory } & 42,000 \\
\hline \text { Ending Merchandise Inventory } & 55,500 \\
\hline
\end{array}\] How much is the gross profit for the year?
A)$212,500
B)$349,000
C)$176,000
D)$178,000
Q3) Define indirect cost.
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Page 4
Chapter 17: Job Order Costing
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191 Verified Questions
191 Flashcards
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Sample Questions
Q1) When would direct labor costs associated with building a custom home be assigned to the job?
A)Only indirect labor is assigned to construction,not direct labor.
B)when the labor is incurred during construction
C)after first being added to manufacturing overhead
D)after the construction has moved from work-in-process to the finished product
Q2) Divit has been given the task of calculating the predetermined overhead rate for Eden Enterprises.In order to calculate the rate,Divit must know ________.
A)the estimated overhead costs for the period and the actual quantity of the overhead allocation base
B)the estimated overhead costs for the period and the estimated quantity of the overhead allocation base
C)the actual overhead costs for the period and the actual quantity of the overhead allocation base
D)the actual overhead costs for the period and the estimated quantity of the overhead allocation base
Q3) Define a process costing system and list two types of businesses that would use a process costing system.
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Chapter 18: Process Costing
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Sample Questions
Q1) The Refining Department of SweetBeet,Inc.had 79,000 tons of sugar to account for in July.Of the 79,000 tons,49,000 tons were completed and transferred to the Boiling Department,and the remaining 30,000 tons were 50% complete.The materials required for production are added at the beginning of the process.Conversion costs are added evenly throughout the refining process.The weighted-average method is used.Calculate the total equivalent units of production for direct materials.
A)64,000 units
B)49,000 units
C)15,000 units
D)79,000 units
Q2) A production cost report helps managers identify the costs that can be reduced in the production process.
A)True
B)False
Q3) Production cost reports prepared using the first-in,first-out (FIFO)method determine the cost of equivalent units of production by accounting for beginning inventory costs separately from current period costs.
A)True
B)False
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Chapter 19: Cost Management Systems: Activity-Based, just-In-Time, and Quality Management Systems
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Sample Questions
Q1) Companies using just-in-time management systems are far more vulnerable to production shutdowns if they receive poor-quality or defective raw materials.
A)True
B)False
Q2) The ________ system pulls materials,labor,and overhead costs into production under a just-in-time management system.
A)purchase-push
B)demand-push
C)purchase-pull
D)demand-pull
Q3) Direct materials cost and direct labor cost can be ________ ________ to products.Manufacturing overhead costs are ________ in cost pools and then ________ to products.
Q4) Managers are able to set an accurate selling price without knowing product cost information.
A)True
B)False
Q5) Why is activity-based costing used? What is an activity? Give an example of an activity.
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Chapter 20: Cost-Volume-Profit Analysis
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Sample Questions
Q1) Total variable costs change in direct proportion to changes in the volume of production.
A)True B)False
Q2) When the variable cost per unit increases,the total number of units required to break even also increases.
A)True B)False
Q3) If the volume of activity doubles in the relevant range,total variable costs will also double.
A)True
B)False
Q4) When the sales price per unit decreases,the contribution margin per unit
A)increases proportionately
B)increases
C)remains the same
D)decreases
Q5) Explain the meaning of the operating loss and operating income areas on a cost-volume-profit (CVP)graph.
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Chapter 21: Variable Costing
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148 Flashcards
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Sample Questions
Q1) The fixed manufacturing overhead is considered a product cost in variable costing and a period cost in absorption costing.
A)True B)False
Q2) Variable costing cannot be used in service companies.
A)True B)False
Q3) Fixed manufacturing overhead is considered a product cost under variable costing.
A)True B)False
Q4) In variable costing,all fixed manufacturing overhead costs are expensed in the period incurred.
A)True
B)False
Q5) Variable costing is used for external reporting purposes,and absorption costing is used for internal decision-making purposes.
A)True B)False
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Chapter 22: Master Budgets
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Sample Questions
Q1) For a merchandising company,what is the formula used to determine the amount of merchandise inventory to be purchased?
Q2) The Raw Materials Inventory account must be considered when calculating the amount of direct materials to be purchased.
A)True
B)False
Q3) The budgeted production of Capricorn,Inc.is 10,000 units per month.Each unit requires 20 minutes of direct labor to complete.The direct labor rate is $100 per hour.Calculate the budgeted cost of direct labor for the month.(Round any intermediate calculations to the nearest cent and your final answer to the nearest dollar.)
A)$333,333
B)$66,667
C)$1,000,000
D)$50,000
Q4) A budget is a financial plan that managers use to coordinate a business's activities. A)True
B)False
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Chapter 23: Flexible Budgets and Standard Cost Systems
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Sample Questions
Q1) Marathon Sports Equipment Company projected sales of 82,000 units at a unit sales price of $14 for the year.Actual sales for the year were 75,000 units at $13.00 per unit.Variable costs were budgeted at $3 per unit,and the actual amount was $4 per unit.Budgeted fixed costs totaled $376,000,while actual fixed costs amounted to $425,000.What is the sales volume variance for total revenue?
A)$173,000 favorable
B)$173,000 unfavorable
C)$98,000 unfavorable
D)$98,000 favorable
Q2) For each of the following variances,state which manager is most likely to be responsible for the variance.
\[\begin{array} { | l | l | }
\hline \text { Variance } & \text { Responsible Manager } \\
\hline \text { Direct Materials Cost } & \\
\hline \text { Direct Labor Efficiency } & \\
\hline \text { Variable Overhead Efficiency } & \\
\hline \end{array}\]
Q3) What does the fixed overhead volume variance measure?
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Chapter 24: Responsibility Accounting and Performance Evaluation
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Sample Questions
Q1) List the four types of responsibility centers.For each center,state the responsibility of the manager.
\(\begin{array}{|c|c|}
\hline \begin{array}{c}
\text { Type of } \\
\text { responsibility center }
\end{array} & \text { Responsibility of the manager } \\
\hline & \\
\hline & \\
\hline & \\
\hline & \\
\hline \end{array}\)
Q2) List the primary goals of performance evaluation systems.
Q3) Revenue center responsibility reports show all costs incurred by the department and are useful when management needs to know the full cost of operating the department.
A)True
B)False
Page 12
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Chapter 25: Short-Term Business Decisions
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Sample Questions
Q1) Which of the following statements is true?
A)Companies are price-takers when their products are unique.
B)Companies are price-setters for a product when there is intense competition.
C)Companies are price-takers for a product when the pricing approach emphasizes cost-plus pricing.
D)Companies are price-takers when they have little or no control over the prices of their products or services.
Q2) Define joint cost.Should joint costs be considered in the decision to sell or further process the product? Explain your answer.
Q3) Merchandisers are constrained by the size of their stores,and managers must choose which products to display.
A)True
B)False
Q4) Special pricing orders increase operating income if the special price exceeds the differential costs of filling the special order.
A)True
B)False
Q5) Define the terms "Relevant Cost" and "Sunk Cost."
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Chapter 26: Capital Investment Decisions
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Sample Questions
Q1) The accounting rate of return is calculated by dividing the average annual operating income by the average amount invested.
A)True
B)False
Q2) Capital budgeting methods which incorporate the time value of money include the
A)net present value method
B)accounting rate of return
C)average rate of return
D)payback method
Q3) Sensitivity analysis is a technique that ________.
A)sets the budgets of alternative investment opportunities
B)analyzes the effect of an investment on workers' morale
C)evaluates the different available investment options
D)shows how results differ when underlying assumptions change
Q4) When evaluating a potential investment,managers should use only one measure for making a sound investment decision.
A)True B)False
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