Acc557 Financial Accounting: Week 4 Chapter 4 Study Guide

Note: Please compare the questions outlined below with your own questions to make sure it's the same. There are other versions of the same quiz. Acc557 Financial Accounting Week 4 Chapter 4 Study Guide 1. IFRS Multiple Choice Question 239 IFRS requires the use of the term balance sheet. the term statement of financial position. neither balance sheet nor statement of financial position, but recommends use of the term balance sheet. neither balance sheet nor statement of financial position, but recommends use of the term statement of financial position. 2. Multiple Choice Question 99 A post-closing trial balance will show zero balances for all accounts. the amount of net income (or loss) for the period. only permanent account balances. only temporary account balances. 3. Multiple Choice Question 106 The heading for a post-closing trial balance has a date line that is similar to the one found on the worksheet. a balance sheet. an income statement. an retained earnings statement 4. Multiple Choice Question 70 The income summary account is a permanent account. appears on the balance sheet. appears on the income statement. is a temporary account. 5. Multiple Choice Question 69 Closing entries are made to close permanent or real accounts. posted to the ledger accounts from the worksheet. journalized in the general journal. an optional step in the accounting cycle. 6. Question 80 The final closing entry to be journalized is typically the entry that closes the expense accounts. Dividends account. revenue accounts. Retained Earnings account. 7. Question 125 On March 8, Black Candy Company bought supplies on account from the Arcade Fire Company for $880. Black Candy Company incorrectly debited Equipment for $800 and credited Accounts Payable for $800. The entries have been posted to the ledger. The correcting entry should be: Supplies..................................... 880 Accounts Payable............... 800 Equipment......................... 80 Supplies..................................... 880 Accounts Payable............... 880 Supplies..................................... 880 Equipment......................... 880 Supplies..................................... 880 Equipment......................... 800 Accounts Payable............... 80 8. IFRS Multiple Choice Question 242 Under IFRS and under GAAP, current assets are listed in IFRS GAAP reverse order of liquidity reverse order of liquidity reverse order of liquidity order of liquidity order of liquidity order of liquidity order of liquidity reverse order of liquidity 9. Multiple Choice Question 112 Which of the following steps in the accounting cycle may be performed most frequently? Prepare a trial balance. Post closing entries. Prepare a post-closing trial balance. Journalize closing entries. 10. Multiple Choice Question 97 A post-closing trial balance is prepared after closing entries have been journalized and posted. before closing entries have been journalized and posted. before closing entries have been journalized but after the entries are posted. after closing entries have been journalized but before the entries are posted. 11. Multiple Choice Question 151 The following items are taken from the financial statements of the Postal Service for the year ending December 31, 2013: Accounts payable $ 19,000 Accounts receivable 11,000 Accumulated depreciation – equipment 28,000 Advertising expense 21,000 Cash 11,000 Common stock 40,000 Depreciation expense 12,000 Dividends 14,000 Insurance expense 3,000 Note payable, due 6/30/14 70,000 Prepaid insurance (12-month policy) 6,000 Rent expense 17,000 Retained earnings (1/1/13) 65,000 Salaries and wages expense 32,000 Service revenue 125,000 Supplies 4,000 Supplies expense 6,000 Equipment 210,000 What are total current assets at December 31, 2013? $38,000 $32,000 $26,000 $28,000 12. Multiple Choice Question 148 The most important information needed to determine if companies can pay their current obligations is the net income for this year. relationship between current assets and current liabilities. projected net income for next year. relationship between short-term and long-term liabilities. 13. Multiple Choice Question 131 The following information is for Bright Eyes Auto Supplies: Bright Eyes Auto Supplies Balance Sheet December 31, 2013 Cash $ 20,000 Accounts Payable $ 65,000 Prepaid Insurance 40,000 Salaries and Wages Payable 25,000 Accounts Receivable 50,000 Mortgage Payable 75,000 Inventory 70,000 Total Liabilities $165,000 Land Held for Investment 90,000 Land 125,000 Building $100,000 Common Stock $120,000 Less Accumulated Retained Earnings 250,000 370,000 Depreciation (30,000) 70,000 Trademark 70,000 Total Liabilities and Total Assets $535,000 Stockholders' Equity $535,000 The total dollar amount of assets to be classified as property, plant, and equipment is $225,000. $285,000. $195,000. $315,000. 14. Multiple Choice Question 173 Current liabilities are listed in the balance sheet in order of their expected maturity. should not include long-term debt that is expected to be paid within the next year. are obligations that the company is to pay within the forthcoming year. are listed in the balance sheet, starting with accounts payable. 15. Question 91 The income statement for the year 2013 of Fugazi Co. contains the following information: Revenues $70,000 Expenses: Salaries and Wages Expense $45,000 Rent Expense 12,000 Advertising Expense 8,000 Supplies Expense 6,000 Utilities Expense 2,500 Insurance Expense 2,000 Total expenses 75,500 Net income (loss) ($5,500) The entry to close the expense accounts includes a debit to Salaries and Wages Expense for $2,500. debit to Income Summary for $75,500. debit to Income Summary for $5,500. credit to Income Summary for $5,500.
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