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General ACCT 2050 W21 Midterm V2 - Compatibility Mode - Excel Home sert Page Layout Formulas Data Review View Help Nitro Pro Arial 12-AA 25 Wiap Text Gerseral %) * B a A- Merge & Center Conditional Formats Cell Formatting Table - Styles pod Font Algiment Number 16 B 1. An internal control system, once instituted, should not be changed. 5 5 2. The calculation of percentage change figures for specific income statement items when viewed over multiple periods can identify the direction in which a business is going 7 8 9 10 3. Comparative horizontal balance sheet analysis shows each individual account, 11 subtotal and total balance changes from one balance sheet date to the next. 12 Changes are described in both dollars and percentages 13 14 4. Accrual accounting is based on the principle of matching sales 15 revenue with expenses. 16 17 5. Contributory income is the income for a department, after indirect expenses 18 have been deducted. Schoo True False Roti AS Closings w P 3 & 7 8 W ERT P S DF G HJ K 6. In a bank reconciliation, an outstanding cheque should be added to the 1 company's bank balance. 2 3 7. Calculating long term solvency ratios using assets at their book value, -4 rather than fair market value, can be misleading. 25 26 8. Retained earnings represent the accumulation of net incomes, less losses, 27 and dividends, since a company started. 28 29 9. Indirect expenses are usually controllable by department managers. 30 31 10. The quick ratio is the same as the current ratio except that, in the quick ratio, 32 the accounts receivable are not included in the current assets. Multiple Choice Analysis Closing Entries True False Ratios Bank Rec