Accounting 220 Final Exam 31 questions fairly easy. Needs to be done in an hour.

The first half of the exam features 6 questions with short answers and calculations. For these, omit all general journal entry explanations. Be sure to include correct dollar signs, commas, underlines, and double-underlines where required. The second half of the exam consists of 25 multiple-choice questions worth 1 point each. The computer will automatically grade the multiple-choice questions, but grading will not be complete until your instructor manually grades the short-answer questions. Your instructor may grant partial credit on short-answer questions for less than complete answers. You can take the final exam only once. You can save each question after answering, and you can save the exam before you submit it. Once you have submitted the exam, you will receive a score and can compare your answers with the correct answers. Section 1: Calculations Part 1 Instructions To submit your answers for this part of the exam, fill in the answer sheet and upload it to the exam. Download: Final Exam Answer Sheet To upload your answer sheet, please follow these instructions: Click the Insert Stuff icon (first on the left). Click Upload to retrieve the file from your computer and upload it. For Link Text: (Your Name) Final Exam Answer Sheet Click Add. (Ignore the Choose Destination prompt.) Click OK. Omit all general journal entry explanations. Be sure to include correct dollar signs, commas, underlines, and double-underlines where required. Question 1 (40 points) Question 1 Unsaved XYZ Company's December 31, 2015, trial balance is as follows: X Account Cash Accounts Receivable Allowance for Doubtful Accounts Notes Receivable Merchandise Inventory Land Building Accumulated Depreciation, Building Equipment Accumulated Depreciation, Equipment Goodwill Accounts Payable Long-Term Notes Payable Common Stock $10 par, 2,000 shares authorized and outstanding Retained Earnings Sales Revenue Salaries Expense Utilities Expense Cost of Goods Sold Administrative Expenses Sales Expenses Totals XYZ Company Trial Balance 31-Dec-15 Debit $43,500 53,500 1,500 30,000 55,000 20,000 150,000 15,000 50,000 21,000 26,000 25,000 75,000 20,000 147,000 700,000 150,000 3,500 350,000 55,000 15,000 $1,003,000 Credit ######## # Additional Information: Notes Receivable is a 3-month, 6% note accepted on November 1, 2015. Long-Term Notes Payable is a 5-year, 5% note that was signed on July 1, 2015. Interest is payable annually. Building is depreciated at 3% per year. There is no salvage value. Equipment is depreciated at 15% per year. There is no salvage value. XYZ discovered, on December 30, that the inexperienced bookkeeper recorded in the general journal and general ledger that day's $1,500 cash sales as a debit to Accounts Receivable and a credit to Sales Revenue. The year-end physical count for Merchandise Inventory reflected a value of $51,500. Any difference in value will not be considered theft or loss. Salaries for the last half of December, payable in January, amount to $5,500. XYZ estimates that of the Accounts Receivable, 5% will not be collectable. Required: Prepare in journal form, any required correcting entries. Prepare in journal form, all end-of-the-period adjusting entries. Prepare a December adjusted trial balance. Prepare a classified balance sheet for the year ended December 31, 2015. Prepare in journal form, the closing entries for the year ended December 31, 2015. Question 2 (8 points) Question 2 Unsaved XYZ Company uses the periodic method and had the following inventory events during January: XD ate Units Purchased Unit Cost Dat e 1Jan 5Jan 10Jan 15Jan 20Jan 25Jan 30- 150 225 $7.0 0 7.2 100 7.5 150 7.8 200 7.95 2Jan 7Jan 12Jan 17Jan 24Jan 150 8 75 8.2 Unit s Sold 100 Unit Sales Price 125 10 75 12 200 12.5 150 15 $10.00 Jan Note: The January 1 amounts were the beginning inventory and unit value. (Round all total dollar values to the nearest dollar. Round all unit values to the nearest penny.) Required: Calculate the cost of goods available for sale. Calculate the dollar value of sales. Calculate the value of Ending Inventory and Cost of Goods Sold under the following independent assumptions: (1) LIFO method (2) FIFO method (3) Average-cost method Question 3 (7 points) Question 3 Unsaved Required: Prepare Acme Supply Company's general journal entries for the following transactions: Jan 1 Accepted RunTimeCo's 120 day, 10% note as settlement of an outstanding $15,000 account receivable for goods sold last year. Jan 15 Purchased $10,000 Equipment from XYZ, signing a 9-month, 12% note. Jan 15 Loaned Warner Co. $30,000 cash, accepting a 90-day, 10% note. Jan 31 Prepared accrual adjusting entry for any interest revenue. April 15 Received payment in full from Warner Co. for outstanding note and interest. May 1 Received payment in full from RunTimeCo for outstanding note and interest. Oct 15 paid XYZ in full. Question 4 (9 points) Question 4 Unsaved XYZ Company purchased a refrigerated delivery truck for $65,000 on January 1, 2015. The plan is to use the truck for 5 years and then replace it. At the end of its useful life, the truck is expected to have a salvage value of $10,000. The fiscal year ends December 31. A. Prepare the depreciation table for XYZ's truck, assuming that the company uses the straight-line method for depreciation. B. Prepare the depreciation table for XYZ's truck, assuming that the company uses the double-decliningbalance depreciation method. C. Compute the depreciation expense for 2015 for XYZ's truck, assuming the truck has an expected life of 200,000 miles and during 2015 the truck was driven 24,540 miles. Round your depreciation expense per mile to three decimal places. Question 5 (7 points) Question 5 Unsaved Acme Company has a January 15 mid-month gross salaries expense of $25,000. All is subject to FICA Social Security (6.2%), FICA Medicare (1.45%), state income tax (5%) and federal income tax (15%) withholdings. Additionally, all is subject to employer taxes to include FUTA (0.8%) and SUTA (5.4%) taxes. (Round all calculations to the nearest penny.) Required: Prepare the general journal entry to record the employer's payroll liability. Prepare the general journal entry to record the employer's payroll-tax liability. Prepare the general journal entry to liquidate the liabilities accrued in parts (a) and (b) on January 22. Question 6 (4 points) Question 6 Unsaved At the end of the fiscal 2015 year, Acme Company has the following information: Credit Sales, $2,500,000; Sales Returns and Allowances, $25,000; Accounts Receivable, $200,000; and Allowance for Doubtful Accounts with a Debit, $1,500. Required: Prepare the general journal entry to record the end-of-the-year adjusting entry if Acme uses 0.5% of Net Credit Sales as the basis for determining Bad-Debt Expense. Prepare the general journal entry to record the end-of-the-year adjusting entry if Acme uses 5% of Accounts Receivable as the basis for determining Bad-Debt Expense. MULTIPLE CHOICE Question 7 (1 point) Question 7 Unsaved After the bank reconciliation is prepared, the entry to record bank service charges would have a credit to _______________. a. b. c. d. e. Bank Service Charge Expense Cash Petty Cash Cash Short and Over None of the above Question 8 (1 point) Question 8 Unsaved Malloy Company estimates uncollectible accounts using the percentage-of-receivables method and expects that 5 percent of outstanding receivables will be uncollectible for 2015. The balance in Accounts Receivable is $200,000, and the allowance account has a $3,000 credit balance before adjustment at year end. The uncollectible accounts expense for 2015 will be _______________. A $7,000 B $10,000 C $13,000 D $9,850 E None of the above Question 9 (1 point) Question 9 Unsaved Malloy Company issued its own $10,000, 90-day, non-interest-bearing note to a bank. The only payment Malloy will ever make to the bank will be for $10,000 at the maturity date of the loan as the bank discounts the note at 10 percent. The proceeds to Malloy are _______________. a. b. c. d. e. $10,000 $9,000 $9,750 $10,250 None of the above Question 10 (1 point) Question 10 Unsaved On 2015 July 1, Malloy Company purchased equipment for $400,000, and installation and testing costs totaled $40,000. The equipment has an estimated useful life of 10 years and an estimated salvage value of $40,000. If Malloy uses the double-declining-depreciation method, the depreciation expense for 2010 is _______________. a. b. c. d. e. $88,000 $72,000 $36,000 $44,000 $40,000 Question 11 (1 point) Question 11 Unsaved The result of recording a capital expenditure as a revenue expenditure is an _______________. a. b. c. d. e. Overstatement of current year's expense Understatement of current year's expense Understatement of subsequent year's net income Overstatement of current year's net income None of the above Question 12 (1 point) Question 12 Unsaved Cole Inc., a new company, purchases a two-year insurance policy for $12,000. Six months later, the correct balance in the prepaid insurance account would be _______________. a. b. c. d. $12,000 $6,000 $9,000 None of the above Question 13 (1 point) Question 13 Unsaved Which of the following is not an advantage of the corporate form of organization? a. b. c. d. Continuous existence of the entity Limited liability of stockholders Government regulation Easy transfer of ownership Question 14 (1 point) Question 14 Unsaved Treasury stock should be shown on the balance sheet as a(n) _______________. a. b. c. d. Reduction of the corporation's stockholders' equity Current asset Current liability Investment asset Question 15 (1 point) Question 15 Unsaved When the stockholders invest cash in the business, what is the effect? a. b. c. d. Liabilities increase and stockholders' equity increases Both assets and liabilities increase Both assets and stockholders' equity increase None of the above Question 16 (1 point) Question 16 Unsaved The ending balance in retained earnings is shown in the _______________. a. b. c. d. e. f. Income statement Statement of retained earnings Balance sheet Both (b) and (c) Both (a) and (c) (a), (b), and (c) Question 17 (1 point) Question 17 Unsaved A cash dividend of $500 was declared and paid to stockholders. The correct journal entry to record the declaration is _______________. a. b. c. d. Debit Capital Stock 500 and credit Cash 500 Debit Cash 500 and credit Dividends 500 Debit Dividends 500 and credit Cash 500 Debit Cash 500 and credit Capital Stock 500 Question 18 (1 point) Question 18 Unsaved If $3,000 has been earned by a company's workers since the last payday in an accounting period, the necessary adjusting entry would be _______________. a. b. c. d. Debit an expense and credit a liability Debit an expense and credit an asset Debit a liability and credit an asset Debit a liability and credit an expense Question 19 (1 point) Question 19 Unsaved The accrual basis of accounting _______________. a. b. c. d. Recognizes revenues only when cash is received Is used by almost all companies Recognizes expenses only when cash is paid out Recognizes revenues when sales are made or services are performed, and recognizes expenses only when cash is paid out Question 20 (1 point) Question 20 Unsaved The need for adjusting entries is based on _______________. a. b. c. d. The matching principle Source documents The cash basis of accounting Activity that has already been recorded in the proper accounts Question 21 (1 point) Question 21 Unsaved Which of the following statements is false regarding the closing process? a. b. c. d. The Dividends account is closed to Income Summary The closing of expense accounts results in a debit to Income Summary The closing of revenues results in a credit to Income Summary The Income Summary account is closed to the Retained Earnings account. Question 22 (1 point) Question 22 Unsaved Which of the following statements is true regarding the classified balance sheet? a. b. c. d. Current assets include cash, accounts receivable, and equipment. Plant, property, and equipment is one category of long-term assets. Current liabilities include accounts payable, salaries payable, and notes receivable. Stockholders' equity is subdivided into current and long-term categories Question 23 (1 point) Question 23 Unsaved The underlying assumptions of accounting include all the following except _______________ a. b. c. d. Business entity Going concern Matching Money measurement and periodicity Question 24 (1 point) Question 24 Unsaved Malloy Company began the accounting period with $60,000 of merchandise, and the net cost of purchases was $240,000. A physical inventory showed $72,000 of merchandise unsold at the end of the period. The cost of goods sold of Malloy Company for the period is _______________. a. b. c. d. e. $300,000 $228,000 $252,000 $168,000 None of the above Question 25 (1 point) Question 25 Unsaved A classified income statement consists of all of the following major sections except _______________. a. b. c. d. e. Operating revenues Cost of goods sold Operating expenses Non-operating revenues and expenses Current assets Question 26 (1 point) Question 26 Unsaved A business purchased merchandise for $12,000 on account; terms are 2/10, n/30. If $2,000 of the merchandise was returned and the remaining amount due was paid within the discount period, the purchase discount would be _______________. a. b. c. d. e. $240 $200 $1,200 $1,000 $3,600 Question 27 (1 point) Question 27 Unsaved Malloy Company began the accounting period with inventory of 3,000 units at $30 each. During the period, the company purchased an additional 5,000 units at $36 each and sold 4,600 units. Assume the use of periodic inventory procedure. The cost of ending inventory using weighted-average is _______________. a. b. c. d. e. $114,750 $157,600 $122,400 $109,650 None of the above Question 28 (1 point) Question 28 Unsaved Malloy Company began the accounting period with inventory of 3,000 units at $30 each. During the period, the company purchased an additional 5,000 units at $36 each and sold 4,600 units. Assume the use of periodic inventory procedure. The cost of goods sold using weighted-average is _______________. a. b. c. d. e. $147,200 $160,350 $155,250 $114,000 None of the above Question 29 (1 point) Question 29 Unsaved During a period of rising prices, which inventory method might be expected to give the highest net income? a. b. c. d. e. Weighted-average FIFO LIFO Specific Identification Cannot determine Question 30 (1 point) Question 30 Unsaved The following information is related to the bank reconciliation of the Acme Company: Balance per bank statement $1,951.20 Balance per ledger $1,869.60 Deposit in transit $271.20 Outstanding checks $427.80 NSF check $61.20 Service charges $13.80 The adjusted/correct cash balance is _______________. a. b. $1,794.60 $1,719.60 c. d. e. $1,638.00 $1,713.00 $1,876.20 Question 31 (1 point) Question 31 Unsaved In a bank reconciliation, deposits in transit should be _______________. a. b. c. d. e. Deducted from the balance per books Deducted from the balance per bank statement Added to the balance per ledger Added to the balance per bank statement Disregard in the bank reconciliation Question 2: 8% points: Inventory Flip uses the period method and had the following inventory events during January: Date Units Purchased Unit Cost Date Jan. 1150 $7.00 Jan. 2 100 7.25 Jan. 7 125 10.00 Jan. 10 100 7.50 Jan. 12 75 12.00 Jan. 15 150 7.50 Jan. 17 200 12.00 Jan. 20 200 7.75 Jan. 24 150 15.00 Jan. 25 150 8.00 Jan. 30 75 Unit Sales Price $10.00 Jan. 5225 Units Sold 8.25 Note: January 1 amount was the beginning inventory and unit value. (Round all total dollar values to the nearest dollar. Round all unit values to the nearest penny.) Acct220 Page 2 of 9 Required: a. Calculate cost of goods available for sale. b. Calculate the dollar value of sales. c. Calculate the value of Ending Inventory and Cost of Good Sold under the following independent assumptions: 1) LIFO method 2) FIFO method 3) Average-cost method Question 3: 7% points: Required: Prepare Flip's Supply Co. general journal entries for the following transactions: Jan. 1Accepted Flop's 120 days, 10% note, as settlement of an outstanding $15,000 account receivable for goods sold last year Jan. 15 Purchased $10,000 Equipment from Floozy, signing a 9 month, 12% note Jan. 25 Loaned Flam Co. $30,000 cash, accepting a 90 days, 10% note Jan. 31 Prepared accrual adjusting entry for any interest revenue Apr. 25 Received payment in full from Flam Co. for outstanding note & interest May 1 Received payment in full from Flop Co. for outstanding note & interest Oct. 15 Paid Floozy in full Question 4: 9% points: Flip Company purchased a refrigerated delivery truck for $65,000 on April 1, 2016. The plan is to use the truck for 4 years and then replace it. At the end of it's useful life the truck is expected to have a salvage value of $10,000. a. Prepare the depreciation table for Flip's truck assuming that the company uses the straight-line method for depreciation. b. Prepare the depreciation table for Flip's truck assuming that the truck was purchased on January 1, 2016 and the company uses the double-declining-balance depreciation method. c. Compute the depreciation expense for 2016 for Flip's truck assuming the truck has an expected life of 200,000 miles and during 2016 the truck was driven 24,540 miles. Round your depreciation expense per mile to three decimal places. Acct220 Page 3 of 9 Question 5: 7% points: Flip Company has a January 15 mid-month gross salaries expense of $25,000. All is subject to FICA Social Security (6.2%), FICA Medicare (1.45%), state income tax (5%) and federal income tax (15%) withholdings. Additionally, all is subject to employer taxes to include FUTA (0.8%) and SUTA (5.4%) taxes. (Round all calculations to the nearest penny.) Required: a. Prepare the general journal entry to record the employer's payroll liability. b. Prepare the general journal entry to record the employer's payroll tax liability. c. Prepare the general journal entry to liquidate the liabilities accrued in parts (a) and (b) on January 22. Question 6: 4% points: Flip Company at the end of the fiscal 2014 year has the following information: Credit Sales, $2,500,000 Sales Returns & Allowances $25,000 Accounts Receivable $200,000 and Allowance for Doubtful Accounts with a debit o $1,500. Required: a. Prepare the general journal entry to record the end of the year adjusting entry if Flip uses 0.5% of Net Credit Sales as the basis for determining Bad Debt Expense. b. Prepare the general journal entry to record the end of the year adjusting entry if Flip uses 5% of Accounts Receivable as the basis for determining Bad Debt Expense