D103 OA2 Intermediate Accounting I (Units 5–7) Quiz 202… 2026 Update • Verified Answers
✓ VERIFIED • 2026 UPDATE • 100% ACCURATE
D103 OA2 Intermediate Accounting I (Units 5–7)
Quiz 2026 UPDATE
Actual Exam Questions & Verified Answers
with Detailed Rationales
Document Type: Exam (Elaborations)
Academic Year:
Total Questions: 50 Multiple Choice
Includes: Correct Answers + Full Rationales
Status: Verified & Updated for 2026
Exam (Elaborations) • Actual Questions & Rationales Page 1
,D103 OA2 Intermediate Accounting I (Units 5–7) Quiz 202… 2026 Update • Verified Answers
Questions & Verified Answers
1. Which inventory method generally results in the highest ending inventory during a period of
rising prices?
A. FIFO
B. LIFO
C. Weighted-average cost
D. Specific identification
Answer: A
Rationale: FIFO assumes the earliest goods purchased are the first ones sold. In periods of rising prices, the
remaining inventory consists of the most recent, higher-cost purchases. Exam questions often test the ability to
distinguish this concept from closely related distractors, making a clear rationale essential for mastery.
2. When applying the lower-of-cost-or-net-realizable-value (LCNRV) rule, net realizable value is
defined as:
A. Selling price minus costs to complete and dispose
B. Selling price plus costs to complete and dispose
C. Replacement cost
D. Selling price
Answer: A
Rationale: Net realizable value (NRV) is the estimated selling price in the ordinary course of business, less
reasonably predictable costs of completion and disposal. This is an important clinical concept because
selecting the correct answer (A) requires understanding both the pathophysiology and the practical nursing
implications. Recognizing this principle allows the nurse to prioritize care, anticipate complications, and provide
accurate patient education.
3. Which of the following costs should be capitalized as part of the cost of land?
A. Fencing and parking lots
B. Excavation costs for a new building
C. Back taxes paid by the buyer at the time of purchase
D. Depreciation on the building
Answer: C
Rationale: Costs necessary to get the land ready for its intended use, such as title fees and back taxes, are
capitalized to the Land account. This is an important clinical concept because selecting the correct answer (C)
requires understanding both the pathophysiology and the practical nursing implications. Recognizing this
principle allows the nurse to prioritize care, anticipate complications, and provide accurate patient education.
Exam (Elaborations) • Actual Questions & Rationales Page 2
, D103 OA2 Intermediate Accounting I (Units 5–7) Quiz 202… 2026 Update • Verified Answers
4. Under the periodic inventory system, how is the cost of goods sold (COGS) determined?
A. By recording it at the time of each sale
B. By performing a physical count of items sold
C. By adding purchases to the beginning inventory
D. By subtracting ending inventory from the cost of goods available for sale
Answer: D
Rationale: In a periodic system, COGS is a residual amount calculated at the end of the period: Beginning
Inventory + Purchases - Ending Inventory. Exam questions often test the ability to distinguish this concept from
closely related distractors, making a clear rationale essential for mastery. Applying this knowledge in clinical
settings supports safe, evidence-based practice and improves patient outcomes.
5. Which depreciation method does not use salvage value in its initial calculation of the
depreciation base for each period?
A. Straight-line
B. Sum-of-the-years’-digits
C. Double-declining balance
D. Units-of-production
Answer: C
Rationale: Double-declining balance applies a constant rate to the book value (Cost minus Accumulated
Depreciation) without subtracting salvage value first, though the asset is not depreciated below its salvage
value. Recognizing this principle allows the nurse to prioritize care, anticipate complications, and provide
accurate patient education.
6. A company exchanges an old machine for a new one. The transaction lacks commercial
substance. If a loss is indicated, the company should:
A. Recognize the loss only if boot is received
B. Defer the loss and adjust the cost of the new machine
C. Recognize the loss immediately
D. Ignore the loss
Answer: C
Rationale: Losses on nonmonetary exchanges are always recognized immediately, regardless of whether the
transaction has commercial substance. Applying this knowledge in clinical settings supports safe,
evidence-based practice and improves patient outcomes. This is an important clinical concept because
selecting the correct answer (C) requires understanding both the pathophysiology and the practical nursing
implications.
Exam (Elaborations) • Actual Questions & Rationales Page 3
✓ VERIFIED • 2026 UPDATE • 100% ACCURATE
D103 OA2 Intermediate Accounting I (Units 5–7)
Quiz 2026 UPDATE
Actual Exam Questions & Verified Answers
with Detailed Rationales
Document Type: Exam (Elaborations)
Academic Year:
Total Questions: 50 Multiple Choice
Includes: Correct Answers + Full Rationales
Status: Verified & Updated for 2026
Exam (Elaborations) • Actual Questions & Rationales Page 1
,D103 OA2 Intermediate Accounting I (Units 5–7) Quiz 202… 2026 Update • Verified Answers
Questions & Verified Answers
1. Which inventory method generally results in the highest ending inventory during a period of
rising prices?
A. FIFO
B. LIFO
C. Weighted-average cost
D. Specific identification
Answer: A
Rationale: FIFO assumes the earliest goods purchased are the first ones sold. In periods of rising prices, the
remaining inventory consists of the most recent, higher-cost purchases. Exam questions often test the ability to
distinguish this concept from closely related distractors, making a clear rationale essential for mastery.
2. When applying the lower-of-cost-or-net-realizable-value (LCNRV) rule, net realizable value is
defined as:
A. Selling price minus costs to complete and dispose
B. Selling price plus costs to complete and dispose
C. Replacement cost
D. Selling price
Answer: A
Rationale: Net realizable value (NRV) is the estimated selling price in the ordinary course of business, less
reasonably predictable costs of completion and disposal. This is an important clinical concept because
selecting the correct answer (A) requires understanding both the pathophysiology and the practical nursing
implications. Recognizing this principle allows the nurse to prioritize care, anticipate complications, and provide
accurate patient education.
3. Which of the following costs should be capitalized as part of the cost of land?
A. Fencing and parking lots
B. Excavation costs for a new building
C. Back taxes paid by the buyer at the time of purchase
D. Depreciation on the building
Answer: C
Rationale: Costs necessary to get the land ready for its intended use, such as title fees and back taxes, are
capitalized to the Land account. This is an important clinical concept because selecting the correct answer (C)
requires understanding both the pathophysiology and the practical nursing implications. Recognizing this
principle allows the nurse to prioritize care, anticipate complications, and provide accurate patient education.
Exam (Elaborations) • Actual Questions & Rationales Page 2
, D103 OA2 Intermediate Accounting I (Units 5–7) Quiz 202… 2026 Update • Verified Answers
4. Under the periodic inventory system, how is the cost of goods sold (COGS) determined?
A. By recording it at the time of each sale
B. By performing a physical count of items sold
C. By adding purchases to the beginning inventory
D. By subtracting ending inventory from the cost of goods available for sale
Answer: D
Rationale: In a periodic system, COGS is a residual amount calculated at the end of the period: Beginning
Inventory + Purchases - Ending Inventory. Exam questions often test the ability to distinguish this concept from
closely related distractors, making a clear rationale essential for mastery. Applying this knowledge in clinical
settings supports safe, evidence-based practice and improves patient outcomes.
5. Which depreciation method does not use salvage value in its initial calculation of the
depreciation base for each period?
A. Straight-line
B. Sum-of-the-years’-digits
C. Double-declining balance
D. Units-of-production
Answer: C
Rationale: Double-declining balance applies a constant rate to the book value (Cost minus Accumulated
Depreciation) without subtracting salvage value first, though the asset is not depreciated below its salvage
value. Recognizing this principle allows the nurse to prioritize care, anticipate complications, and provide
accurate patient education.
6. A company exchanges an old machine for a new one. The transaction lacks commercial
substance. If a loss is indicated, the company should:
A. Recognize the loss only if boot is received
B. Defer the loss and adjust the cost of the new machine
C. Recognize the loss immediately
D. Ignore the loss
Answer: C
Rationale: Losses on nonmonetary exchanges are always recognized immediately, regardless of whether the
transaction has commercial substance. Applying this knowledge in clinical settings supports safe,
evidence-based practice and improves patient outcomes. This is an important clinical concept because
selecting the correct answer (C) requires understanding both the pathophysiology and the practical nursing
implications.
Exam (Elaborations) • Actual Questions & Rationales Page 3
