ACCT300 Business Accounting: Week 4 Quiz (Winter 2014)

ACCT300 Business AccountingWeek 4 Quiz (Winter 2014)
 
Question 1 of 20
The accounting term depreciation measures:
A.the decline in an asset's market value.
B.the amount of cash a company sets aside for asset replacement.
C.the amount of asset cost allocated to expense over periods benefited.
D.the anticipated loss if asset is sold in the used-asset market.
 
Question 2 of 20
Which of the following expenditures would not be included in the cost of a fixed asset?
A.Freight costs
B.Vandalism
C.Sales taxes
D.Surveying fees
 
Question 3 of 20
The estimated amount that an asset can be sold for at the end of its useful life is called its book value.
A. True
B. False
 
Question 4 of 20
If a company sells a fixed asset for an amount which is less than its book value, a gain must be recognized.
A. True
B. False
 
Question 5 of 20
The reduction in the par or stated value of common stock, accompanied by the issuance of a proportionate number of additional shares, is called a stock split.
A. True
B. False
 
Question 6 of 20
Which of the following is a characteristic of fixed assets?
A.Fixed assets are offered for sale as part of normal operations.
B.Fixed assets do not exist physically.
C.Fixed assets are long-term or relatively permanent assets.
D.Fixed assets that are no longer used in operations are still classified as fixed assets.
 
Question 7 of 20
A bond is simply a form of an interest-bearing note.
A. True
B. False
 
Question 8 of 20
The process of transferring the cost of metal ores and other minerals removed from the earth to an expense account is called
A.depletion.
B.deferral.
C.amortization.
D.depreciation.
 
Question 9 of 20
The balance in Accumulated Depreciation account is deducted from the cost of fixed assets on the balance sheet.
A. True
B. False
 
Question 10 of 20
The main source of paid-in capital is from issuing stock.
A. True
B. False
 
Question 11 of 20
What is the effect of a stock dividend on the balance sheet?
A.Decrease total assets and decrease total stockholders' equity
B.Decrease total assets and increase total stockholders' equity
C.Increase total liabilities and decrease total stockholders' equity
D.No effect on total assets, total liabilities, or total stockholders' equity
 
Question 12 of 20
What is the effect of a stock dividend on the balance sheet?
A.Decrease total assets and decrease total stockholders' equity
B.Decrease total assets and increase total stockholders' equity
C.Increase total liabilities and decrease total stockholders' equity
D.No effect on total assets, total liabilities, or total stockholders' equity
 
Question 13 of 20
The balance in Accumulated Depreciation account is deducted from the cost of fixed assets on the balance sheet.
A. True
B. False
 
Question 14 of 20
What are current liabilities?
A.Liabilities that are due and payable within two years.
B.Liabilities that are due and to be paid out of the current assets within one year.
C.Liabilities that are due but not payable for more than one year.
D.Liabilities that are payable if a possible subsequent event occurs.
 
Question 15 of 20
The reduction in the par or stated value of common stock, accompanied by the issuance of a proportionate number of additional shares, is called a stock split.
A. True
B. False
 
Question 16 of 20
The total earnings of an employee for a payroll period is referred to as the net pay.
A. True
B. False
 
Question 17 of 20
The exclusive right to use a certain name or symbol is called a
A.franchise.
B.patent.
C.trademark.
D.copyright.
 
Question 18 of 20
For the year that just ended, a company reports net income of $1,500,000. There are 500,000 shares authorized, 300,000 shares issued, and 250,000 shares of common stock outstanding. What is the earnings per share?
A.$5.00
B.$2.50
C.$6.00
D.$3.00
 
Question 19 of 20
A current liability is a debt that is reasonable expected to be paid
A.between 6 months and 18 months.
B.out of currently recognized revenues.
C.within one year.
D.out of cash currently on hand.
 
Question 20 of 20
Fixed assets are reported at their book value on the balance sheet.
A. True
B. False
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