ACC 307 ACC307 Week 8 Final Exam Answers (Southern New Hampshire University)
Owners' equity can be expressed as assets minus liabilities.
XYZ Corporation receives $100,000 from investors for issuing them shares of its stock. XYZ's journal entry to record this transaction would include a:
Recording revenue that is earned, but not yet collected, is an example of:
Which of the following is NOT an adjusting entry?
The adjusting entry required to record accrued expenses includes:
A company's market value is generally less than its book value.
Which of the following accounts are closed at the end of the accounting period?
New Oaks Winery requires two months to make wine, two years to age it, one month to bottle it, two months to sell it, and one month to collect the receivable. Its operating cycle is:
An exception that is so serious that even a qualified opinion is not justified would result in:
Gains, but not losses, from discontinued operations must be separately reported in an income statement.
Freda's Florist reported the following before-tax income statement items for the year ended December 31, 2013:
On August 1, 2013, Rocket Retailers adopted a plan to discontinue its catalog sales division, which qualifies as a separate component of the business according to GAAP regarding discontinued operations. The disposal of the division was expected to be concluded by June 30, 2014. On January 31, 2014, Rocket's fiscal year-end, the following information relative to the discontinued division was accumulated:
On October 28, 2013, Mercedes Company committed to a plan to sell a division that qualified as a component of the entity according to GAAP regarding discontinued operations and was properly classified as held for sale on December 31, 2013, the end of the company's fiscal year. The division's loss from operations for 2013 was $2,000,000.
The division's book value and fair value less cost to sell on December 31 were $3,000,000 and $3,500,000, respectively. What before-tax amount(s) should Mercedes report as loss on discontinued operations in its 2013 income statement?
If the seller is a principal, the seller has primary responsibility for delivering a product or service.
For a typical manufacturing company, the most common critical point for recognizing revenue is the date:
On December 15, 2013, Rigsby Sales Co. sold a tract of land that cost $3,600,000 for $4,500,000. Rigsby appropriately uses the installment sale method of accounting for this transaction. Terms called for a down payment of $500,000 with the balance in two equal annual installments payable on December 15, 2014, and December 15, 2015. Ignore interest charges. Rigsby has a December 31 year-end.
In 2013, Rigsby would recognize realized gross profit of:
Boomerang Computer Company sells computers with an unconditional right to return the computer if the customer is not satisfied. Boomerang has a long history selling these computers under this returns policy and can provide precise estimates of the amount of returns associated with each sale. Boomerang most likely should recognize revenue:
Summary data for Benedict Construction Co.'s (BCC) Job 1227, which was completed in 2013, are presented below:
When interest is compounded, the stated rate of interest exceeds the effective rate of interest.
Below are excerpts from time value of money tables for the 8% rate.
An investment product promises to pay $42,000 at the end of 10 years. If an investor feels this investment should produce a rate of return of 12%, compounded annually, what's the most the investor should be willing to pay for the investment?
Present and future value tables of 1 at 11% are presented below. Spielberg Inc. signed a $200,000 noninterest-bearing note due in five years from a production company eager to do business. Comparable borrowings have carried an 11% interest rate. What is the value of this debt at its inception?
A series of equal periodic payments in which the first payment is made one compounding period after the date of the contract is:
If the direct method is used to report cash flows from operating activities in the body of the statement of cash flows, a reconciliation of net income to net cash flows from operating activities also is required.
Cash equivalents generally would not include short-term investments in:
A firm reported salary expense of $239,000 for the current year. The beginning and ending balances in salaries payable were $40,000 and $15,000, respectively. What was the amount of cash paid for salaries?
Which of the following is always reported as an outflow of cash?
Payments to acquire bonds of other corporations should be classified on a statement of cash flows as:
Pastina Company manufactures and sells various types of pasta to grocery chains as private label brands. The company’s fiscal year-end is December 31. The unadjusted trial balance as of December 31, 2013, appears below.
Selected information about income statement accounts for the Reed Company is presented below (the company's fiscal year ends on December 31):
Harding Company is in the process of purchasing several large pieces of equipment from Danning Machine Corporation. Several financing alternatives have been offered by Danning:
The income statement and a schedule reconciling cash flows from operating activities to net income are provided below ($ in millions) for Mike Roe Computers.
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