ACCT 2000 Final Exam EOC Practice Lowe-Ardoin ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
(Questions with verified answers) ||\\|//|| ||\\|//|| ||\\|//||
Chapter 1-2 ||\\|//|| ||\\|//||
What is the basic accounting equation? - correct answer✔✔Assets = Liabilities +
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
Stockholders' Equity ||\\|//||
Which is an advantage of corporations relative to partnerships and sole proprietorships? -
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
correct answer✔✔Reduced legal liability for investors ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
Which forms of business organization are considered to be separate accounting entities? -
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
correct answer✔✔Sole Proprietorship, Corporations, and Partnerships.
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
Which of the following did NOT result from the Sarbanes-Oxley Act? - correct
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔Tax rates on corporations increased. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
The payment of dividends is an example of a(n) - correct answer✔✔financing activity
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
What kind of classification is cost of goods sold? - correct answer✔✔expense
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
What section of cash flow statement shows the cash spent on new equipment during the
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
past accounting period? - correct answer✔✔The investing section
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
If total liabilities decreased by $15,000 and stockholders' equity increased by $5,000 during
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
a period of time, then total assets must change by what amount and direction during that
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
same period? - correct answer✔✔$10,000 decrease
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
,(Assets = Liabilities + Stockholders' Equity) ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
Which is NOT one of the three forms of business organizations? - correct ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔Creditorship
Ease of transferring ownership is a characteristic of which form of business organization? -
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
correct answer✔✔Corporation ||\\|//||
In which forms of business organization are the owners personally liable for all the debts
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
of the business? - correct answer✔✔Sole proprietorships and Partnerships
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
The sole proprietorship form of business organization? - correct answer✔✔Generally,
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
receives favorable tax treatment relative to a corporation ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
To which of the following questions will internal users want answers? - correct
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔All of the answer choices are correct. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
- what selling price for our product will maximize the company's net income?
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
- which product line is most profitable?
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
- is cash sufficient to pay dividend to stockholders?
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
Which of the following is NOT an external user of accounting data? - correct ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔Chief Financial Officer ||\\|//|| ||\\|//||
Which statement about users of accounting information is INCORRECT? - correct ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔Regulatory authorities are considered internal users. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
, Which of the following is the most appropriate definition of accounting? - correct
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔The information system that identifies, records, and communicates the ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
economic events of an organization to interested users. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
Paying interest expense and receiving interest revenue are examples of - correct
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔Operating activates ||\\|//||
Which of the following is NOT one of the three primary business activities? - correct
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔Advertising
Which of the following is an example of a financing activity? - correct answer✔✔Issuing
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
shares of common stock ||\\|//|| ||\\|//|| ||\\|//||
Resources owned by a business are referred to as - correct answer✔✔assets ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
In terms of the principal types of business activities, paying salaries expense is an example
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
of an - correct answer✔✔operating activity
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
On Jan. 10, Novis Company purchased manufacturing equipment for $80,000 cash. What
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
kind of activity is this? - correct answer✔✔Investing activity
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
In what section of the statement of cash flows would the purchase of office equipment for
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
$10,000 cash appear? - correct answer✔✔Investing activities ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
Which of the following is NOT one of the primary types of the financing activities in the
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
statement of cash flows? - correct answer✔✔Buying equipment ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
Which of the following would NOT appear on the income statement? - correct
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔Dividends paid ||\\|//||
(Questions with verified answers) ||\\|//|| ||\\|//|| ||\\|//||
Chapter 1-2 ||\\|//|| ||\\|//||
What is the basic accounting equation? - correct answer✔✔Assets = Liabilities +
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
Stockholders' Equity ||\\|//||
Which is an advantage of corporations relative to partnerships and sole proprietorships? -
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
correct answer✔✔Reduced legal liability for investors ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
Which forms of business organization are considered to be separate accounting entities? -
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
correct answer✔✔Sole Proprietorship, Corporations, and Partnerships.
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
Which of the following did NOT result from the Sarbanes-Oxley Act? - correct
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔Tax rates on corporations increased. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
The payment of dividends is an example of a(n) - correct answer✔✔financing activity
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
What kind of classification is cost of goods sold? - correct answer✔✔expense
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
What section of cash flow statement shows the cash spent on new equipment during the
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
past accounting period? - correct answer✔✔The investing section
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
If total liabilities decreased by $15,000 and stockholders' equity increased by $5,000 during
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
a period of time, then total assets must change by what amount and direction during that
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
same period? - correct answer✔✔$10,000 decrease
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
,(Assets = Liabilities + Stockholders' Equity) ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
Which is NOT one of the three forms of business organizations? - correct ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔Creditorship
Ease of transferring ownership is a characteristic of which form of business organization? -
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
correct answer✔✔Corporation ||\\|//||
In which forms of business organization are the owners personally liable for all the debts
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
of the business? - correct answer✔✔Sole proprietorships and Partnerships
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
The sole proprietorship form of business organization? - correct answer✔✔Generally,
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
receives favorable tax treatment relative to a corporation ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
To which of the following questions will internal users want answers? - correct
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔All of the answer choices are correct. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
- what selling price for our product will maximize the company's net income?
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
- which product line is most profitable?
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
- is cash sufficient to pay dividend to stockholders?
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
Which of the following is NOT an external user of accounting data? - correct ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔Chief Financial Officer ||\\|//|| ||\\|//||
Which statement about users of accounting information is INCORRECT? - correct ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔Regulatory authorities are considered internal users. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
, Which of the following is the most appropriate definition of accounting? - correct
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔The information system that identifies, records, and communicates the ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
economic events of an organization to interested users. ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
Paying interest expense and receiving interest revenue are examples of - correct
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔Operating activates ||\\|//||
Which of the following is NOT one of the three primary business activities? - correct
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔Advertising
Which of the following is an example of a financing activity? - correct answer✔✔Issuing
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
shares of common stock ||\\|//|| ||\\|//|| ||\\|//||
Resources owned by a business are referred to as - correct answer✔✔assets ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
In terms of the principal types of business activities, paying salaries expense is an example
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
of an - correct answer✔✔operating activity
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
On Jan. 10, Novis Company purchased manufacturing equipment for $80,000 cash. What
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
kind of activity is this? - correct answer✔✔Investing activity
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
In what section of the statement of cash flows would the purchase of office equipment for
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
$10,000 cash appear? - correct answer✔✔Investing activities ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
Which of the following is NOT one of the primary types of the financing activities in the
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
statement of cash flows? - correct answer✔✔Buying equipment ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
Which of the following would NOT appear on the income statement? - correct
||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//|| ||\\|//||
answer✔✔Dividends paid ||\\|//||
