Intermediate Financial Accounting
Chapter Exam Questions
Course Introduction
Intermediate Financial Accounting builds upon foundational accounting principles, focusing on the application and analysis of accounting standards for complex financial transactions. The course explores topics such as revenue recognition, the measurement and reporting of assets and liabilities, investments, income taxes, and shareholders' equity within the framework of International Financial Reporting Standards (IFRS) and/or Generally Accepted Accounting Principles (GAAP). Emphasis is placed on preparing and interpreting financial statements, understanding ethical considerations, and applying critical thinking to real-world accounting scenarios. This course is designed to deepen students technical expertise and analytical skills necessary for advanced studies and professional practice in accounting.
Recommended Textbook
Financial Accounting 2nd Edition by J. David Spiceland
Available Study Resources on Quizplus
15 Chapters
1948 Verified Questions
1948 Flashcards
Source URL: https://quizplus.com/study-set/3887
Page 2
Chapter 1: Accounting Information and Decision Making
Available Study Resources on Quizplus for this Chatper
165 Verified Questions
165 Flashcards
Source URL: https://quizplus.com/quiz/77420
Sample Questions
Q1) The difference between revenues and expenses is referred to as net income or net loss.
A)True
B)False
Answer: True
Q2) The balance sheet is a financial statement that reports the company's revenues and expenses over an interval of time.
A)True
B)False
Answer: False
Q3) McGill purchases additional office equipment to better serves its customers.This purchase is classified as what type of activity?
A)Company activity.
B)Financing activity.
C)Investing activity.
D)Operating activity.
Answer: C
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
171 Verified Questions
171 Flashcards
Source URL: https://quizplus.com/quiz/77419
Sample Questions
Q1) Childers Service Company provides services to customers totaling $3,000,for which it billed the customers.How would the transaction be recorded?
A)Debit Cash $3,000,credit Service Revenue $3,000.
B)Debit Accounts Receivable $3,000,credit Service Revenue $3,000.
C)Debit Accounts Receivable $3,000,credit Cash $3,000.
D)Debit Service Revenue $3,000,credit Accounts Receivable $3,000.
Answer: B
Q2) Clement Company paid an account payable related to a previous utility bill of $1,000.This transaction should be recorded as follows on the payment date:
A)Debit Accounts Payable $1,000,credit Cash $1,000.
B)Debit Cash $1,000,credit Accounts Payable $1,000.
C)Debit Utilities Expense $1,000,credit Cash $1,000.
D)Debit Cash $1,000,credit Utilities Expense $1,000.
Answer: A
Q3) Unearned Revenue is a liability account.
A)True
B)False
Answer: True
To view all questions and flashcards with answers, click on the resource link above. Page 4
Chapter 3: The Financial Reporting Process
Available Study Resources on Quizplus for this Chatper
158 Verified Questions
158 Flashcards
Source URL: https://quizplus.com/quiz/77418
Sample Questions
Q1) Which accounting principle states that a company should "record revenues when they are earned"?
A)Matching
B)Revenue recognition
C)Conservatism
D)Materiality
Answer: B
Q2) The Supplies account is an example of an accrued expense.
A)True
B)False Answer: False
Q3) The adjusting entry for an accrued revenue always includes a debit to a liability account and a credit to a revenue account.
A)True
B)False Answer: False
Q4) Unearned revenues occur when cash is received after the revenue is earned.
A)True
B)False Answer: False
To view all questions and flashcards with answers, click on the resource link above. Page 5
Chapter 4: Cash and Internal Controls
Available Study Resources on Quizplus for this Chatper
145 Verified Questions
145 Flashcards
Source URL: https://quizplus.com/quiz/77417
Sample Questions
Q1) Management needs to monitor the internal control system,just like any other system.Any control deficiencies spotted by employees should be reported immediately to management.
A)True
B)False
Q2) Cash transactions recorded by the bank but not yet recorded by the company include all of the following except A)Service fees.
B)Interest earned.
C)Checks outstanding.
D)NSF checks.
Q3) A company establishes a petty cash fund for $400.By the end of the month,employees had made the following expenditures from the fund: supplies,$150; fuel for deliveries,$120; postage,$75; miscellaneous,$35.Record the entry to recognize expenditures from the petty cash fund.
Q4) A company's operating cash inflows less operating cash outflows generally equals the reported amount of net income in the income statement.
A)True
B)False
To view all questions and flashcards with answers, click on the resource link above. Page 6
Chapter 5: Receivables and Sales
Available Study Resources on Quizplus for this Chatper
141 Verified Questions
141 Flashcards
Source URL: https://quizplus.com/quiz/77416
Sample Questions
Q1) Sandburg Veterinarian reports the following information for the year: \(\begin{array}{lr}
\text { Net credit sales } & \$ 120,000 \\
\text { Average accounts receivable } & 20,000 \\
\text { Cash collections on credit sales } & 100,000 \end{array}\)
What is Sandburg's receivables turnover ratio?
A)6.0.
B)5.0.
C)1.2.
D)0.2.
Q2) Richard LLC accounts for possible bad debts using the allowance method.When an actual bad debt occurs,what effect does it have on the accounting equation?
A)Increases assets and increases stockholders' equity.
B)Decreases assets and decreases stockholders' equity.
C)Decreases assets and decreases liabilities.
D)No effect on the accounting equation.
Q3) On April 14,a company lends $10,000 cash to one of its employees and accepts a six-month,12% note in return.Record the acceptance of the note receivable.
To view all questions and flashcards with answers, click on the resource link above.
Page 7
Chapter 6: Inventory and Cost of Goods Sold
Available Study Resources on Quizplus for this Chatper
150 Verified Questions
150 Flashcards
Source URL: https://quizplus.com/quiz/77415
Sample Questions
Q1) A periodic inventory system does not continually modify inventory amounts,but instead adjusts for purchases and sales of inventory at the end of the reporting period based on a physical count of inventory on hand.
A)True
B)False
Q2) Baker Fine Foods has beginning inventory for the year of $12,000.During the year,Baker purchases inventory for $150,000 and ends the year with $20,000 of inventory.Baker will report cost of goods sold equal to:
A)$150,000.
B)$158,000.
C)$142,000.
D)$170,000.
Q3) After applying the lower-of-cost-or-market method,the accountant prepares a year-end adjustment.That adjustment would:
A)Decrease the company's cost of goods sold.
B)Reduce the company's stockholders' equity.
C)Increase the company's inventory.
D)Increase the company's total assets.
Q4) __________ is commonly referred to as the balance sheet approach.
To view all questions and flashcards with answers, click on the resource link above. Page 8
Chapter 7: Long-Term Assets
Available Study Resources on Quizplus for this Chatper
149 Verified Questions
149 Flashcards
Source URL: https://quizplus.com/quiz/77414
Sample Questions
Q1) If a firm successfully defends an intangible right,it should expense the litigation costs as incurred.
If a firm successfully defends an intangible right,it should capitalize the litigation costs and amortize them over the remaining useful life of the related intangible.
A)True B)False
Q2) Goodwill is amortized over its estimated useful life. Intangible assets with an indefinite useful life (goodwill and most trademarks)are not amortized.
A)True B)False
Q3) When a change in estimate is required,the company changes depreciation in prior,current and future years. When a change in estimate is required,the company changes depreciation in current and future years,but not in prior periods.
A)True B)False
To view all questions and flashcards with answers, click on the resource link above. Page 9
Chapter 8: Current Liabilities
Available Study Resources on Quizplus for this Chatper
135 Verified Questions
135 Flashcards
Source URL: https://quizplus.com/quiz/77413
Sample Questions
Q1) On December 1,2012,Old World Deli signed a $300,000,5%,six-month note payable with the amount borrowed plus accrued interest due six months later on June 1,2013.Old World Deli should record which of the following adjusting entries at December 31,2012?
A)Debit Interest Expense and credit Interest Payable,$7,500.
B)Debit Interest Expense and credit Cash,$7,500.
C)Debit Interest Expense and credit Interest Payable,$1,250.
D)Debit Interest Expense and credit Cash,$1,250.
Q2) The journal entry to record a contingent liability requires a debit to a loss (or expense)account and a credit to a liability.
A)True
B)False
Q3) Deductions from employee salaries in determining the amount of payroll checks include withholdings for federal and state income taxes,FICA taxes,and the employee portion of insurance and retirement contributions.
A)True
B)False
Q4) Why is it important to distinguish between current and long-term liabilities?
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
150 Verified Questions
150 Flashcards
Source URL: https://quizplus.com/quiz/77412
Sample Questions
Q1) X2 issued the bonds for:
A)$100,000.
B)$107,000.
C)$104,212.
D)Cannot be determined from the given information.
Q2) As a company's default risk increases,investors demand a higher market interest rate on their bond investments.
A)True
B)False
Q3) Secured bonds are backed by the federal government.
A)True
B)False
Q4) The times interest earned ratio compares interest expense with income available to pay interest charges.
A)True
B)False
Q5) As a company's level of debt increases,bankruptcy risk increases.
A)True
B)False
Q6) Why do some companies issue bonds rather than borrow money directly from a bank?
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
136 Verified Questions
136 Flashcards
Source URL: https://quizplus.com/quiz/77411
Sample Questions
Q1) Retained Earnings is the amount stockholders have invested in the company.
A)True
B)False
Q2) Par value has a direct relationship to the market value of the common stock.
A)True
B)False
Q3) Jade Jewelers issued 15,000 shares of $1 par value stock for $20 per share.What is true about the journal entry to record the issuance?
A)Credit Common Stock $300,000.
B)Credit Cash $300,000.
C)Credit Common Stock $15,000.
D)Debit Additional Paid-In Capital $285,000.
Q4) The statement of stockholders' equity shows
A)Only the ending balance in each stockholders' equity account.
B)How each equity account changed over time.
C)Only the beginning balance in each stockholders' equity account.
D)Less information than the stockholders' equity section in the balance sheet.
Q5) Earnings per share is useful in comparing earnings performance across companies.
A)True
B)False
Page 12
To view all questions and flashcards with answers, click on the resource link above.
Chapter 11: Statement of Cash Flows
Available Study Resources on Quizplus for this Chatper
145 Verified Questions
145 Flashcards
Source URL: https://quizplus.com/quiz/77410
Sample Questions
Q1) Under the indirect method,an increase in inventory is added to net income and a decrease in inventory is subtracted from net income to arrive at net cash flows from operating activities.
A)True
B)False
Q2) The balance sheet of The Computer Doctor reports total assets of $160,000 and $220,000 at the beginning and end of the year,respectively.The cash return on assets for the year is 10%.Calculate The Computer Doctor's net cash flows from operating activities for the year.
Q3) We report the actual amount of cash proceeds received from the sale of land as a cash inflow from investing activities.
A)True
B)False
Q4) The purchase of land is classified in the statement of cash flows as a(n):
A)Operating activity.
B)Investing activity.
C)Financing activity.
D)Noncash activity.
To view all questions and flashcards with answers, click on the resource link above.
13
Chapter 12: Financial Statement Analysis
Available Study Resources on Quizplus for this Chatper
136 Verified Questions
136 Flashcards
Source URL: https://quizplus.com/quiz/77409
Sample Questions
Q1) Which of the following is an aggressive accounting practice?
A)Change from straight-line to double-declining balance depreciation.
B)Record sales revenue before it is actually earned.
C)Adjust the allowance for uncollectible accounts to a larger amount.
D)Record inventory at lower of cost or market rather than at cost.
Q2) Comparing operating expenses as a percentage of sales is an example of:
A)Vertical analysis.
B)Horizontal analysis.
C)Diagonal analysis.
D)Both vertical and horizontal analysis.
Q3) Stealth Company's 2013 profit margin is:
A)17.1%.
B)13.5%.
C)7.6%.
D)4.5%.
Q4) Paul Pierce Enterprises reports net income of $800,000,average total assets of $2,400,000,and average total liabilities of $400,000.Calculate the return on asset and return on equity ratios.
Q5) If a company's sales are $648,000 in 2012,and this represents an 8% increase over sales in 2011,what were sales in 2011?
Page 14
To view all questions and flashcards with answers, click on the resource link above.
Chapter 13: Time Value of Money
Available Study Resources on Quizplus for this Chatper
72 Verified Questions
72 Flashcards
Source URL: https://quizplus.com/quiz/77423
Sample Questions
Q1) If you put $200 into a savings account that pays annual compound interest of 8% per year and then withdraw the money two years later,you will earn interest of $32.
A)True
B)False
Q2) If you put $600 into a savings account that pays simple interest of 10% per year and then withdraw the money two years later,you will earn interest of $126.
A)True
B)False
Q3) The more frequent the rate of compounding,the more interest that is earned on previous interest,resulting in a higher future value.
A)True
B)False
Q4) The value that an amount today will grow to in the future is referred to as the:
A)Future value of a single amount.
B)Present value of a single amount.
C)Future value of an annuity.
D)Present value of an annuity.
Q5) Explain the difference between present value and future value.
To view all questions and flashcards with answers, click on the resource link above. Page 15
Chapter 14: Investments
Available Study Resources on Quizplus for this Chatper
52 Verified Questions
52 Flashcards
Source URL: https://quizplus.com/quiz/77422
Sample Questions
Q1) The primary difference in accounting for available-for-sale securities and accounting for trading securities is:
A)Measuring the fair value of the long-term and short-term stock portfolios.
B)Computing the cost at acquisition.
C)Determining where the unrealized holding gain or loss on investments is reported in the financial statements; in current net income or in comprehensive income.
D)Accounting for dividends received.
Q2) Unrealized gains and losses from changes in the fair value of available-for-sale securities are reported as part of current net income.
A)True
B)False
Q3) The cash received from interest equals the face value of the investment in bonds times the stated interest rate.
A)True
B)False
Q4) Discuss the meaning of consolidated financial statements.When is it appropriate to consolidate financial statements of two companies?
To view all questions and flashcards with answers, click on the resource link above.
16
Chapter 15: International Financial Reporting Standards
Available Study Resources on Quizplus for this Chatper
41 Verified Questions
41 Flashcards
Source URL: https://quizplus.com/quiz/77421
Sample Questions
Q1) One motivation for reducing differences in accounting practices across countries is to:
A)Decrease the flow of international capital.
B)Allow greater competition among companies.
C)Reduce companies' tax burdens.
D)Make it easier for investors to compare companies from different countries.
Q2) IFRS stands for:
A)Independent Financial Reporting System.
B)International Financing Reform System.
C)International Financial Reporting Standards.
D)International Financial Regulation of Securities.
Q3) Suppose a company has research costs of $100,000 and development costs of $200,000 for the year.Under IFRS,what amount would be reported as an expense in the current year's income statement?
A)$100,000.
B)$150,000.
C)$200,000.
D)$300,000.
Q4) What does it mean to revalue a long-term asset? How do U.S.GAAP and IFRS differ regarding revaluation of long-term assets?
Page 17
To view all questions and flashcards with answers, click on the resource link above.