ASU ACC 231 EXAM 2 -USES OF ACCOUNTING
INFORMATION I |ACTUAL QUESTIONS AND
VERIFIED ANSWERS|BRAND NEW 2026-2027
UPDATE|GRADED A+
Question 1
Which of the following indicates the shipment is free on board and the buyer pays all of
the shipping and freight costs?
-Cash on deliver
-FOB destination
-2/10, n/30
-FOB shipping point
CORRECT ANSWER
FOB shipping point
Question 2
On December 1, Macy Company sold merchandise with a selling price of $9000 on account
to Mrs. Jorgenson, with terms 4/10, n/30. On December 3, Mrs. Jorgenson returned
merchandise with a selling price of $700. Mrs. Jorgenson paid the amount due on
December 9. What journal entry did Macy Company prepare on December 9 assuming the
gross method is used?
CORRECT ANSWER
Debit Cash for $7968, debit Sales Discounts for $332, and credit Accounts Receivable for
$8300
[$9000 - $700 (returned amount)]
[$8300 * 0.96 (4/10)]
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@THE STUDY VAULT
, [$7968]
Question 3
The following account balances were extracted from the accounting records of Thomas
Corporation at the end of the year:
Accounts Receivable: $1,105,000
Allowance for Uncollectible Accounts (Credit): $37,000
Uncollectible-Account Expense: $60,000
What is the net realizable value of the accounts receivable?
CORRECT ANSWER
$1,068,000
[Accounts Receivable - Allowance for Uncollectible Accounts]
Question 4
If the interest rate on a note is 12.5% and the principal was $57,000, what is the maturity
value of the note, if the term of the note is 5 months?
CORRECT ANSWER
$59,969
[5 months = 5/12]
[5/12 * 12.5 = 5.208%]
[$57,000 * 5.208%]
[59,969]
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@THE STUDY VAULT
,Question 5
If both current ratio and quick ratio have improved, has a company's liquidity improved?
CORRECT ANSWER
Yes
Question 6
A company has $28,000 in cash and cash equivalents, $88,000 in short-term investments,
$122,000 in net current receivables, $64,000 in inventory, $14,000 of prepaid insurance
and $11,000 of supplies. The total current liabilities of the firm are $304,000. The quick
ratio of the company is:
CORRECT ANSWER
0.78
[28,000 + 88,000 + 122,000 = 238,000]
[238,000/304,000]
[0.78]
Question 7
A company has sales revenue of $131,000, cost of goods sold of $63,000, operating
expenses of $34,000, and other expenses of $2,000. The company's gross profit is:
CORRECT ANSWER
$68,000
[131,000 - 63,000]
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@THE STUDY VAULT
, Question 8
Gross Profit and Gross Profit Margin Formula
CORRECT ANSWER
Gross Profit = Revenue - COGS
Gross Profit Margin = (Revenue - COGS)/Revenue
Question 9
Quick Ratio Formula
CORRECT ANSWER
Quick Assets/Current Liabilities
Question 10
A company has sales revenue of $133,000, cost of goods sold of $63,000, operating
expenses of $37,000, and other expenses of $4,000. The company's operating income is:
CORRECT ANSWER
$33,000
[133,000 - 63,000 - 37,000}
Question 11
Operating Income Formula
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@THE STUDY VAULT
INFORMATION I |ACTUAL QUESTIONS AND
VERIFIED ANSWERS|BRAND NEW 2026-2027
UPDATE|GRADED A+
Question 1
Which of the following indicates the shipment is free on board and the buyer pays all of
the shipping and freight costs?
-Cash on deliver
-FOB destination
-2/10, n/30
-FOB shipping point
CORRECT ANSWER
FOB shipping point
Question 2
On December 1, Macy Company sold merchandise with a selling price of $9000 on account
to Mrs. Jorgenson, with terms 4/10, n/30. On December 3, Mrs. Jorgenson returned
merchandise with a selling price of $700. Mrs. Jorgenson paid the amount due on
December 9. What journal entry did Macy Company prepare on December 9 assuming the
gross method is used?
CORRECT ANSWER
Debit Cash for $7968, debit Sales Discounts for $332, and credit Accounts Receivable for
$8300
[$9000 - $700 (returned amount)]
[$8300 * 0.96 (4/10)]
1
@THE STUDY VAULT
, [$7968]
Question 3
The following account balances were extracted from the accounting records of Thomas
Corporation at the end of the year:
Accounts Receivable: $1,105,000
Allowance for Uncollectible Accounts (Credit): $37,000
Uncollectible-Account Expense: $60,000
What is the net realizable value of the accounts receivable?
CORRECT ANSWER
$1,068,000
[Accounts Receivable - Allowance for Uncollectible Accounts]
Question 4
If the interest rate on a note is 12.5% and the principal was $57,000, what is the maturity
value of the note, if the term of the note is 5 months?
CORRECT ANSWER
$59,969
[5 months = 5/12]
[5/12 * 12.5 = 5.208%]
[$57,000 * 5.208%]
[59,969]
2
@THE STUDY VAULT
,Question 5
If both current ratio and quick ratio have improved, has a company's liquidity improved?
CORRECT ANSWER
Yes
Question 6
A company has $28,000 in cash and cash equivalents, $88,000 in short-term investments,
$122,000 in net current receivables, $64,000 in inventory, $14,000 of prepaid insurance
and $11,000 of supplies. The total current liabilities of the firm are $304,000. The quick
ratio of the company is:
CORRECT ANSWER
0.78
[28,000 + 88,000 + 122,000 = 238,000]
[238,000/304,000]
[0.78]
Question 7
A company has sales revenue of $131,000, cost of goods sold of $63,000, operating
expenses of $34,000, and other expenses of $2,000. The company's gross profit is:
CORRECT ANSWER
$68,000
[131,000 - 63,000]
3
@THE STUDY VAULT
, Question 8
Gross Profit and Gross Profit Margin Formula
CORRECT ANSWER
Gross Profit = Revenue - COGS
Gross Profit Margin = (Revenue - COGS)/Revenue
Question 9
Quick Ratio Formula
CORRECT ANSWER
Quick Assets/Current Liabilities
Question 10
A company has sales revenue of $133,000, cost of goods sold of $63,000, operating
expenses of $37,000, and other expenses of $4,000. The company's operating income is:
CORRECT ANSWER
$33,000
[133,000 - 63,000 - 37,000}
Question 11
Operating Income Formula
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@THE STUDY VAULT
