ACCT 301A Exam 1 with all Correct & 100% Verified
Answers |Latest Version |Already Graded A+
Which of the following is not transferred to Retained Earnings at the end of the period?
Revenues.
Dividends.
Common stock.
Expenses ✔Correct Answer-Common Stock
When a corporation purchases a computer for cash, total assets are unchanged (because one asset is
exchanged for another) and there are no changes to liabilities or stockholders' equity. When a
purchase is made for cash, the cash account is credited.
When a corporation purchases a computer for cash, ✔Correct Answer-Cash will be credited
A trial balance proves ✔Correct Answer-Debits and credits are equal in a ledger
The difference between the cost of a depreciable asset and its related contra account, Accumulated
Depreciation is referred to as the asset's ✔Correct Answer-Book value
The adjusting entry to record an accrued expense includes a debit to: ✔Correct Answer-an expense
account and a credit to a liability account.
What 3 things make an income statement useful? ✔Correct Answer-1. Evaluate the past
performance of the company
2. Provide a basis for predicting future
performance
3. Help assess the risk or uncertainty of achieving future cash flows
What are the 3 limitations of an income statement? ✔Correct Answer-1. Companies omit items
from the income statement that they cannot measure reliably
2. Income numbers are affected by the accounting methods employed.
3. Income measurement involves judgment.
Income attributed to controlling stockholders = ✔Correct Answer-(Net income - Income attributed
to the non-controlling interest)
Unusual and infrequent gains and losses
A. are reported net of tax.
B. include restructuring charges.
C. include the elimination of a component of the
business.
D. include restructuring charges and are reported
net of tax. ✔Correct Answer-B.
, Which of the following would be reported in a separate income statement category, separately from
continuing operations, on the income statement?
Which of the following would be reported in a separate income statement category, separately from
continuing operations, on the income statement?
A. Unusual Gains
B. Unusual Losses
C. Income Tax Expense
D. Discontinued Operations ✔Correct Answer-D.
Noncontrolling interest
A. Is shown in a separate section of the income statement after discontinued operations, net of tax.
B. Is reported as a separate item below net income or loss.
C. Is shown in a separate section of the income statement after continuing operations but before
discontinued operations net of tax.
D. Is not shown on the face of the income statement. ✔Correct Answer-A.
Barger Enterprises has an unusual or infrequent loss of $300,000, an unusual gain of $700,000, and a
tax rate of 30%. At what amount should Barger report each item?
Unusual loss Unusual gain
1. $(300,000) $700,000
2. (300,000) 490,000
3. (210,000) 700,000
4. (210,000) 490,000 ✔Correct Answer-1.
When a company transfers an amount of restricted retained earnings into a different account, that
account is titled ✔Correct Answer-Appropriated Retained Earnings
Gains and losses that bypass net income but affect stockholders' equity are referred to as:
✔Correct Answer-Other Comprehensive Net Income
Which limitation of an income statement occurs when one company uses an accelerated
depreciation method while another company uses straight-line depreciation?
A. Companies omit from the income statement
items they cannot measure reliably.
B, Income measurement involves judgment.
C. Income numbers are affected by the
accounting methods employed.
D. All of these answer choices are correct. ✔Correct Answer-C.
The major elements of the income statement are ✔Correct Answer-Revenues, Expenses, Gains,
Losses
A multiple-step income statement
Answers |Latest Version |Already Graded A+
Which of the following is not transferred to Retained Earnings at the end of the period?
Revenues.
Dividends.
Common stock.
Expenses ✔Correct Answer-Common Stock
When a corporation purchases a computer for cash, total assets are unchanged (because one asset is
exchanged for another) and there are no changes to liabilities or stockholders' equity. When a
purchase is made for cash, the cash account is credited.
When a corporation purchases a computer for cash, ✔Correct Answer-Cash will be credited
A trial balance proves ✔Correct Answer-Debits and credits are equal in a ledger
The difference between the cost of a depreciable asset and its related contra account, Accumulated
Depreciation is referred to as the asset's ✔Correct Answer-Book value
The adjusting entry to record an accrued expense includes a debit to: ✔Correct Answer-an expense
account and a credit to a liability account.
What 3 things make an income statement useful? ✔Correct Answer-1. Evaluate the past
performance of the company
2. Provide a basis for predicting future
performance
3. Help assess the risk or uncertainty of achieving future cash flows
What are the 3 limitations of an income statement? ✔Correct Answer-1. Companies omit items
from the income statement that they cannot measure reliably
2. Income numbers are affected by the accounting methods employed.
3. Income measurement involves judgment.
Income attributed to controlling stockholders = ✔Correct Answer-(Net income - Income attributed
to the non-controlling interest)
Unusual and infrequent gains and losses
A. are reported net of tax.
B. include restructuring charges.
C. include the elimination of a component of the
business.
D. include restructuring charges and are reported
net of tax. ✔Correct Answer-B.
, Which of the following would be reported in a separate income statement category, separately from
continuing operations, on the income statement?
Which of the following would be reported in a separate income statement category, separately from
continuing operations, on the income statement?
A. Unusual Gains
B. Unusual Losses
C. Income Tax Expense
D. Discontinued Operations ✔Correct Answer-D.
Noncontrolling interest
A. Is shown in a separate section of the income statement after discontinued operations, net of tax.
B. Is reported as a separate item below net income or loss.
C. Is shown in a separate section of the income statement after continuing operations but before
discontinued operations net of tax.
D. Is not shown on the face of the income statement. ✔Correct Answer-A.
Barger Enterprises has an unusual or infrequent loss of $300,000, an unusual gain of $700,000, and a
tax rate of 30%. At what amount should Barger report each item?
Unusual loss Unusual gain
1. $(300,000) $700,000
2. (300,000) 490,000
3. (210,000) 700,000
4. (210,000) 490,000 ✔Correct Answer-1.
When a company transfers an amount of restricted retained earnings into a different account, that
account is titled ✔Correct Answer-Appropriated Retained Earnings
Gains and losses that bypass net income but affect stockholders' equity are referred to as:
✔Correct Answer-Other Comprehensive Net Income
Which limitation of an income statement occurs when one company uses an accelerated
depreciation method while another company uses straight-line depreciation?
A. Companies omit from the income statement
items they cannot measure reliably.
B, Income measurement involves judgment.
C. Income numbers are affected by the
accounting methods employed.
D. All of these answer choices are correct. ✔Correct Answer-C.
The major elements of the income statement are ✔Correct Answer-Revenues, Expenses, Gains,
Losses
A multiple-step income statement
