Rutgers Intro to Financial Accounting Final exam questions with answers.

Rutgers Intro to Financial Accounting |\ |\ |\ |\ |\




Final exam questions with answers
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What is the Accounting Equation? Also what are the respective normal
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balances? - CORRECT ANSWERS ✔✔Assets = Liabilities + Owner's
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Equity
debit credit credit
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Under assets what 3 types are there? - CORRECT ANSWERS
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✔✔Current Assets, Investments, Property Plant and Equipment
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Under liabilities what 2 types are there? - CORRECT ANSWERS
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✔✔Current and Long-Term liabilities |\ |\ |\




Under Owner's equity what 3 sections are there? - CORRECT
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ANSWERS ✔✔Common Stock, Preferred Stock, Retained Earnings
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What is included in the Income Statement? Also what is the normal
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balance? What is the product of those two items?And where does that
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amount go? - CORRECT ANSWERS ✔✔Revenues and expenses
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credit debit
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revenues- expenses = Net income/loss which is added to retained
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earnings

,What is a worksheet and is it required? What are the steps in
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preparation? - CORRECT ANSWERS ✔✔Optional multiple column tool |\ |\ |\ |\ |\ |\ |\ |\



to help in making financial Statements
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1) Prepare a trial balance on the worksheet
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2) Enter adjusting entries (keying)
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3) Adjust balances and extend correct amount to place in income
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statement column or balance sheet column |\ |\ |\ |\ |\




4) Total columns and calculate net income/loss
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5) Close the books, close temporary accounts and keep permanent
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accounts. |\




6) Post closing trial balance shows about after
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What are the closing entries to close the books? - CORRECT ANSWERS
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✔✔a)Debit revenue accounts and credit income summary
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b)credit expense accounts and debit income summary
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c)debit/credit (whichever is more) income summary and do the |\ |\ |\ |\ |\ |\ |\ |\ |\



opposite to retained earnings |\ |\ |\




d)credit dividends and debit retained earnings
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What are correcting entries? - CORRECT ANSWERS ✔✔Not adjusting
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entries, but fixing entries whenever an issue is found
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, What is the formula for COGS? - CORRECT ANSWERS ✔✔Beginning
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Inventory + Purchases - ending inventory
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extra: Sales revenue - COGS = Gross profit - Operating Expenses = Net
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Income


beginning inventory + COGS = Goods available for sale
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True or false, Service Companies have longer operating cycles. -
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CORRECT ANSWERS ✔✔False |\ |\




What are the 2 types of inventory systems? - CORRECT ANSWERS
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✔✔Periodic and Perpetual |\ |\




Characteristics of a periodic system: - CORRECT ANSWERS ✔✔Per |\ |\ |\ |\ |\ |\ |\ |\ |\



period inventory count
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Uses purchases account and discount account
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Characteristics of a perpetual system - CORRECT ANSWERS ✔✔every |\ |\ |\ |\ |\ |\ |\ |\ |\



change in inventory is recorded
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Uses inventory and cash and COGS
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Stuff is often purchased and sold on account
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