ACCT 210 MIDTERM EXAM(Completely solved)
Your bookkeeper is off for the day and you are trying to figure out what her last entry in the
journal could be for. Unfortunately, she only recorded the debit side of the transaction as $4,400
to Accounts Payable. It is possible that this debit could correspond to correct answers a payment
of $4,400 to a supplier to settle a balance due.
Which one of the following items is correct concerning the time element of financial statements?
correct answers The statement of retained earnings explains changes during a particular period.
Which the following organizations is primarily responsible for establishing GAAP today? correct
answers FASB (financial accounting standards board)
The accountant for Busch Corp. was preparing a bank reconciliation as of February 28, 2017.
The following items were identified:
Busch's book balance $15,000
Outstanding checks $2,500
Service charge $15
Customer's NSF check returned by the bank $100
What amount will Busch report as its adjusted cash balance at February 28, 2017? $15,000
(Book balance) - $100 (NSF check) - $15 (Service charge) = correct answers $14,885
Floors, Inc. offers terms of 2/10, n/30 to credit customers. Tile Magic Corp. purchased 100 tile
cutters with a list price of $20 each on August 5, 2017, on account. Tile Magic Corp. paid the
invoice on August 31, 2017. How much sales discount will Floors recognize? correct answers $0
Murphy Corporation's end-of-year balance sheet consisted of the following amounts:
Cash $ 35,000
Accounts receivable $46,000
Property, plant, and equipment $69,000
Long-term debt $41,000
Capital stock $107,000
Accounts payable $22,000
Retained earnings ?
Inventory 33,000
What is Murphy's owners' equity balance at the end of the current year? Assets: $35,000 +
$69,000 + $46,000 + $33,000 = $183,000Liabilities: $41,000 + $22,000 = $63,000Owners'
equity: $183,000 - $63,000 = correct answers $120,000
Which of the following accounts are normally reported as long-term liabilities on a classified
balance sheet? correct answers Notes payable due in five years and bonds payable
, Which of the following events (transactions) is an internal event for a business entity? correct
answers Periodically, the historical cost of the computer equipment used by an accountant is
recorded as depreciation expenses.
If a work sheet is used, it is prepared correct answers before preparing financial statements.
Which of the following includes only current assets? correct answers Accounts receivable, cash,
inventory, office supplies
Which of the following statements regarding cost of goods available for sale is true? correct
answers Cost of goods available for sale is a "pool" of costs to be distributed between what was
sold and what was not sold during a period.
Which of the following transactions affects the liabilities for Gravette, Inc.? correct answers
Payment is made on a bank loan which Gravette had obtained six months ago.
If a company has $152,000 of revenues, declares and pays $55,000 in dividends, and has net
income of $89,000, how much were expenses for the year? $152,000 (Revenues) - $89,000 (Net
income) = (Expenses) correct answers $63,000
The balance sheet of Jobston, Inc. includes the following items:
Cash$22,400
Accounts receivable $11,700
Inventory $23,300
Prepaid insurance $1,040
Land $80,000
Accounts payable $47,500
Salaries payable$1,200
Capital stock $84,040
Retained earnings $5,700
Read the information about Jobston, Inc. What is Jobston's working capital? Working Capital =
Current Assets - Current Liabilities = ($22,400 + $11,700 + $23,300 + $1,040) - ($47,500 +
$1,200) = $58,440 - $48,700 = correct answers $9,740
Which pair of accounts has the same set of rules for debit and credit entries? correct answers
Common Stock (Capital Stock) and Accounts Payable
The correct term for an entry made to the left side of an account is correct answers debit
Which of the following statements regarding inventory is true? correct answers Wholesalers and
retailers incur a single type of cost, the purchase price, of the inventory they sell.
Your bookkeeper is off for the day and you are trying to figure out what her last entry in the
journal could be for. Unfortunately, she only recorded the debit side of the transaction as $4,400
to Accounts Payable. It is possible that this debit could correspond to correct answers a payment
of $4,400 to a supplier to settle a balance due.
Which one of the following items is correct concerning the time element of financial statements?
correct answers The statement of retained earnings explains changes during a particular period.
Which the following organizations is primarily responsible for establishing GAAP today? correct
answers FASB (financial accounting standards board)
The accountant for Busch Corp. was preparing a bank reconciliation as of February 28, 2017.
The following items were identified:
Busch's book balance $15,000
Outstanding checks $2,500
Service charge $15
Customer's NSF check returned by the bank $100
What amount will Busch report as its adjusted cash balance at February 28, 2017? $15,000
(Book balance) - $100 (NSF check) - $15 (Service charge) = correct answers $14,885
Floors, Inc. offers terms of 2/10, n/30 to credit customers. Tile Magic Corp. purchased 100 tile
cutters with a list price of $20 each on August 5, 2017, on account. Tile Magic Corp. paid the
invoice on August 31, 2017. How much sales discount will Floors recognize? correct answers $0
Murphy Corporation's end-of-year balance sheet consisted of the following amounts:
Cash $ 35,000
Accounts receivable $46,000
Property, plant, and equipment $69,000
Long-term debt $41,000
Capital stock $107,000
Accounts payable $22,000
Retained earnings ?
Inventory 33,000
What is Murphy's owners' equity balance at the end of the current year? Assets: $35,000 +
$69,000 + $46,000 + $33,000 = $183,000Liabilities: $41,000 + $22,000 = $63,000Owners'
equity: $183,000 - $63,000 = correct answers $120,000
Which of the following accounts are normally reported as long-term liabilities on a classified
balance sheet? correct answers Notes payable due in five years and bonds payable
, Which of the following events (transactions) is an internal event for a business entity? correct
answers Periodically, the historical cost of the computer equipment used by an accountant is
recorded as depreciation expenses.
If a work sheet is used, it is prepared correct answers before preparing financial statements.
Which of the following includes only current assets? correct answers Accounts receivable, cash,
inventory, office supplies
Which of the following statements regarding cost of goods available for sale is true? correct
answers Cost of goods available for sale is a "pool" of costs to be distributed between what was
sold and what was not sold during a period.
Which of the following transactions affects the liabilities for Gravette, Inc.? correct answers
Payment is made on a bank loan which Gravette had obtained six months ago.
If a company has $152,000 of revenues, declares and pays $55,000 in dividends, and has net
income of $89,000, how much were expenses for the year? $152,000 (Revenues) - $89,000 (Net
income) = (Expenses) correct answers $63,000
The balance sheet of Jobston, Inc. includes the following items:
Cash$22,400
Accounts receivable $11,700
Inventory $23,300
Prepaid insurance $1,040
Land $80,000
Accounts payable $47,500
Salaries payable$1,200
Capital stock $84,040
Retained earnings $5,700
Read the information about Jobston, Inc. What is Jobston's working capital? Working Capital =
Current Assets - Current Liabilities = ($22,400 + $11,700 + $23,300 + $1,040) - ($47,500 +
$1,200) = $58,440 - $48,700 = correct answers $9,740
Which pair of accounts has the same set of rules for debit and credit entries? correct answers
Common Stock (Capital Stock) and Accounts Payable
The correct term for an entry made to the left side of an account is correct answers debit
Which of the following statements regarding inventory is true? correct answers Wholesalers and
retailers incur a single type of cost, the purchase price, of the inventory they sell.
