ACC 210 Final Exam Practice Questions
With Complete Answers
/Impairment of an operating asset (PP & E) should be recognized when - Answer-The
sum of the estimated future cash flows is below the book value
/.Assume we have a machine with a current book value of $110000. We estimate that it
will produce a $30000 cash flow each year for the next 4 years. WE estimate its fair
value to be $105000. Impaired or not? - Answer-No, since the sum of the future cash
flows, $120000 (30000 x 4 years) exceeds the $110000 book value
/.Sales discount... - Answer-A credit to a customer's account when they pay promptly
/.When an actual Accounts Receivable is written off as uncollectible - Answer-The net
receivable value of accounts receivable is unchanged.
/.Asset purchased on 7/1/17 for $300,000.
Useful life=5 years.
Salvage value=$30000
DDB depreciation expense in 2017 equals - Answer-$60,000
/.Writing off a specific Accounts Receivable as uncollectible involves - Answer-Debiting
Allowance for Doubtful Accounts
/.Gambit Stores accepts from Leonard Co. a $3400, 3-month, 6% note dated May 10.
The note matures 3 months late.
The journal entry on August 10 is - Answer-A credit to Interest Revenue of $51
/.Which of the following would be classified as an investing activity? - Answer-
Purchasing new piece of equipment for cash
/.Which of the following would be classified as a financing activity? - Answer-Borrowing
cash from a bank to be used as land
/.Which section of the Statement of Cash Flows appears first? - Answer-Operating
activities
/.Cash dividend payments are reported as..... - Answer-a financing activity in cash flow
/.If Prepaid Rent = $5000 at 1/1/17 and $8000 at 12/31, what kind of adjustment to Net
Income (NI) is needed to convert Net Income to Cash Flows from operating activities? -
Answer-Subtract out $300 from Net Income (NI)
With Complete Answers
/Impairment of an operating asset (PP & E) should be recognized when - Answer-The
sum of the estimated future cash flows is below the book value
/.Assume we have a machine with a current book value of $110000. We estimate that it
will produce a $30000 cash flow each year for the next 4 years. WE estimate its fair
value to be $105000. Impaired or not? - Answer-No, since the sum of the future cash
flows, $120000 (30000 x 4 years) exceeds the $110000 book value
/.Sales discount... - Answer-A credit to a customer's account when they pay promptly
/.When an actual Accounts Receivable is written off as uncollectible - Answer-The net
receivable value of accounts receivable is unchanged.
/.Asset purchased on 7/1/17 for $300,000.
Useful life=5 years.
Salvage value=$30000
DDB depreciation expense in 2017 equals - Answer-$60,000
/.Writing off a specific Accounts Receivable as uncollectible involves - Answer-Debiting
Allowance for Doubtful Accounts
/.Gambit Stores accepts from Leonard Co. a $3400, 3-month, 6% note dated May 10.
The note matures 3 months late.
The journal entry on August 10 is - Answer-A credit to Interest Revenue of $51
/.Which of the following would be classified as an investing activity? - Answer-
Purchasing new piece of equipment for cash
/.Which of the following would be classified as a financing activity? - Answer-Borrowing
cash from a bank to be used as land
/.Which section of the Statement of Cash Flows appears first? - Answer-Operating
activities
/.Cash dividend payments are reported as..... - Answer-a financing activity in cash flow
/.If Prepaid Rent = $5000 at 1/1/17 and $8000 at 12/31, what kind of adjustment to Net
Income (NI) is needed to convert Net Income to Cash Flows from operating activities? -
Answer-Subtract out $300 from Net Income (NI)
