Question
25 EASY ACCOUNTING 1 QUESTIONS! HELP! 1. Which of the following bank reconciliation items should not be added to or subtracted from the bank statement
25 EASY ACCOUNTING 1 QUESTIONS! HELP!
1. Which of the following bank reconciliation items should not be added to or subtracted from the bank statement balance to determine the reconciled cash balance?
Select one:
A. Outstanding checks
B. Deposits in the mail but not yet received by the bank
C. Bank service charges
D. None of the above
2. Assume the following unadjusted account balances at the end of the accounting period for Wyoming Hardware: Accounts Receivable, $80,000; Allowance for Doubtful Accounts, $1,600 (debit balance); Sales revenue, $900,000.
If Wyoming Hardware ages the accounts and determines that $4,000 of the receivables may be uncollectible, the adjusting entry should be
Select one:
A.
Bad Debts Expense | 2,400 |
| |
| Allowance for Doubtful Accounts |
| 2,400 |
B.
Bad Debts Expense | 4,000 |
| |
| Allowance for Doubtful Accounts |
| 4,000 |
C.
Bad Debts Expense | 5,600 |
| |
| Allowance for Doubtful Accounts |
| 5,600 |
D.
Bad Debts Expense | 4,000 |
| |
| Accounts Receivable |
| 4,000 |
3. On January 1, 2016, Roberto, Inc. acquired a new machine for $186,750. Its estimated useful life is nine years with an expected salvage value of $6,750.
Assuming straight-line depreciation, 2016 depreciation expense is:
Select one:
A. $20,000
B. $19,000
C. $20,750
D. $16,500
4. Which of the following is not a primary activity of effective cash management?
Select one:
A. Increase the rate at which accounts receivable are collected.
B. Cash payments to suppliers should be delayed.
C. Inventory levels should be kept high.
D. Excess cash should be invested in short-term investments to earn interest rates on the cash balances.
5. Sullivan Company received its February bank statement, which included a memo indicating that the check of Emma Company for $435 had been returned as NSF. Sullivans bank reconciliation should list this check as a(n):
Select one:
A. Addition to balance per bank statement
B. Addition to balance per general ledger
C. Deduction from balance per bank statement
D. Deduction from balance per general ledger
6. On January 1, 2016, Skyward Company purchased a copy machine. The machine costs $320,000, its estimated useful life is 8 years, and its expected salvage value is $20,000.
What is the depreciation expense for 2017 using double-declining-balance method?
Select one:
A. $35,000
B. $52,500
C. $80,000
D. $60,000
7.In establishing an effective internal control structure, management should:
Select one:
A. Establish a good control environment
B. Provide an effective accounting system
C. Integrate control procedures into the control environment and accounting system
D. All of the above
8. The purpose of depreciation accounting is to:
Select one:
A. Have a plant asset's book value equal its initial cost by the end of its useful life
B. Allocate a plant asset's cost, less its salvage value, to expense over the asset's useful life
C. Accumulate funds to replace a plant asset at the end of its useful life
D. Reflect changes in the current value of a plant asset over its useful life
9. Kate Company purchased a tractor at a cost of $120,000 on January 1, 2016. The tractor has an estimated salvage value of $20,000 and an estimated life of 8 years.
If Kate uses the straight-line method, what is the book value at January 1, 2020?
Select one:
A. $70,000
B. $50,000
C. $82,500
D. None of the above
10. Which of the following is not one of the three elements of the fraud triangle?
Select one:
A. Pressure
B. Rationalization
C. Opportunity
D. Embezzlement
11. Which of the following would you add to the balance per general ledger to arrive at the reconciled cash balance in a bank reconciliation?
Select one:
A. Bank service charge
B. Deposits in transit
C. Collection of a note by bank
D. NSF checks
12. A $20,000, 3-month, 8% note is dated June 1, 2016. The maturity date and maturity value of the note are, respectively:
Select one:
A. September 1, 2016; $400
B. September 1, 2016; $20,400
C. August 29, 2016; $20,400
D. August 29, 2016; $20,000
13. How should intangible assets be disclosed on the balance sheet?
Select one:
A. At cost in the current assets section
B. Net of the costs already amortized
C. At the estimated fair value at the balance sheet date
D. As a reduction of stockholders' equity
14. How is the gain (loss) on a plant asset sale calculated?
Select one:
A. Asset sale price Asset purchase cost
B. Asset sale price Total accumulated depreciation
C. Asset sale price Book value of the asset
D. Asset fair value Asset sale price
15. What is a bank reconciliation?
Select one:
A. A statement sent monthly by a bank to its depositors.
B. A schedule that accounts for differences between a firms cash account balance and the balance reported by its bank.
C. A formal financial statement that lists all of a firms bank account balances.
D. A merger of two banks that were previously competitors.
16. The Cash amount properly shown on the year-end balance sheet is the:
Select one:
A. Balance in the general ledger account after entries from the year-end bank reconciliation have been posted
B. Balance per the year-end bank statement less deposits in transit and plus outstanding checks
C. Balance in the general ledger account before the year-end bank reconciliation
D. Balance per the year-end bank statement
17. If the Boulder Companys accountant mistakenly records a deposit of $454 as $545, the error would be shown on the bank reconciliation statement as a:
Select one:
A. $91 addition to the book balance
B. $91 addition to the bank balance
C. $91 deduction from the book balance
D. $91 deduction from the bank balance
18. Which of the following depreciation methods would result in the most depreciation in the first year, assuming an eight year life and no salvage value?
Select one:
A. The depreciation would be the same under both methods
B. Double-declining balance
C. Straight line
D. Not enough information available to determine answer
19. The book value of a depreciable asset is:
Select one:
A. The original cost of the asset
B. The original cost of the asset less its salvage value
C. The accumulated depreciation on the asset
D. The original cost of the asset less its accumulated depreciation
20. Which of the following is not a balance sheet category for long-lived assets?
Select one:
A. Plant assets
B. Revenue expenditures
C. Intangible assets
D. None of the above
21. Which of the following is a term identifying the periodic expensing of a plant asset?
Select one:
A. Amortization
B. Depreciation
C. Depletion
D. Betterment
22. Which of the following items would you add to the bank statement balance to arrive at the reconciled cash balance in a bank reconciliation:
Select one:
A. Bank service charges
B. Outstanding checks
C. NSF' checks
D. None of the above
23. On which financial statement and at what amount are accounts receivable reported?
Select one:
A. Balance sheet at the amount owed by customers
B. Income statement at the net uncollectible amount
C. Income statement at the amount written off
D. Balance sheet at the net realizable value
24. After writing off a customer's account, a company using the allowance method subsequently collected the account in full. It should:
Select one:
A. Debit Cash and credit Accounts Receivable
B. Debit Cash and credit Miscellaneous Income
C. Debit Accounts Receivable and credit Allowance for Doubtful Accounts
D. Both A and C
25. Assume the following unadjusted account balances at the end of the accounting period for Johanna Company: Accounts Receivable, $100,000; Allowance for Doubtful Accounts, $1,400 (debit balance); and Net sales, $1,200,000.
If Johannas past experience indicates credit losses of 1% of net sales, the adjusting entry to estimate doubtful accounts is:
Select one:
A.
Bad Debts Expense | 12,000 |
| |
| Accounts Receivable |
| 12,000 |
B.
Bad Debts Expense | 12,000 |
| |
| Allowance for Doubtful Accounts |
| 12,000 |
C.
Bad Debts Expense | 13,400 |
| |
| Allowance for Doubtful Accounts |
| 13,400 |
D.
Bad Debts Expense | 10,600 |
| |
| Allowance for Doubtful Accounts |
| 10,600 |
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