1 | Page Downloaded by: alinemutua2 ()
ACCT 301 – Intermediate Accounting | A+ Graded
Exam Material (2025/2026)
The method of inventory usually provides a better match of expenses with
revenues a-LIFO b-FIFO a-Weighted Average d- all of the above -
SOLUTION=LIFO
A company's market value is generally less than its book value
TRUE
FALSE - SOLUTION=false
what is the effect of the adjusting journal entry to write down inventory to its net
realizable value? a-Decrease net income. b-Decrease total assets.
c-Decrease total assets and net income. d-Increase retained earnings. -
SOLUTION=Decrease total assets and net income.
when a seller offers a right of return, which is true:
a-sales are net of estimated returns b-sales
are gross returns, returns are expenses c-sales
are net of actual returns
d-sales are gross of returns, returns are ignored - SOLUTION=sales are net of
estimated returns
which financial statement shows information for a point in time ONLY?
a-balance sheet b-income statement c- statement of cash flows
d-statement of shareholders equity - SOLUTION=balance sheet
Document shared on https://www.docsity.com/en/docs/acct-301-intermediate-accounting-or-a-graded-exam-material-wxu9wcmkwf/15109880/
,2 | Page
A company receiving a donated will record a(n):
a- increase in liabilities b-increase in revenue c-decrease in
assets d-decrease in liabilities - SOLUTION=an increase in
revenue
Collections of accounts receivable that previously have been written off result in
an increase in cash and an increase in:
a- accounts receivable b- bad debt expense c-allowance for
uncollectible accounts d- retained earnings - SOLUTION=Allowance for
uncollectible accounts
Jo paid $840 to Tot co. for a 6 month course that started on June 1. As of August 1,
the financial records would show:
a-$560 Revenue; $280 Accounts Receivable b-
$560 revenue; $280 Deferred Revenue c-$280
Revenue; $560 Accounts Receivable d-$280
Revenue; $280 Deferred Revenue -
SOLUTION=280 Revenue; $280 Deferred
Revenue
when FASB issues new accounting standards, they call them:
Document shared on https://www.docsity.com/en/docs/acct-301-intermediate-accounting-or-a-graded-exam-material-wxu9wcmkwf/15109880/
,3 | Page Downloaded by: alinemutua2 ()
a-Financial Technical Bulletins b-Financial Accounting Standards c-
Accounting Standards Updates d-Accounting Research Bulletins -
SOLUTION=Accounting Standards Updates
Which of the following is recorded by a credit to accounts receivable?
a-write off of bad debts b-sale of inventory on account c-estimating
the annual allowance for uncollectible accounts d-estimating annual
sales returns - SOLUTION=write off of bad debts
operating cash outflows would include:
a-Purchases of inventory b-Purchases of equipment c-payments
of cash dividends d-Purchase of investments -
SOLUTION=Purchases of inventory
When selling PP&E for cash, the seller recognizes:
a-The seller recognizes a gain or loss for the difference between cash received and
the fair value of the asset sold
b-The seller recognizes a gain or loss for the difference between cash received and
the book value of the asset sold c-The seller recognizes losses, but not gains
d-None of these choices are correct - SOLUTION=The seller recognizes a gain or
loss for the difference between cash received and the book value of the asset sold
The exclusion right to use a company's name and sell its product within a specified
geographic area is called:
Document shared on https://www.docsity.com/en/docs/acct-301-intermediate-accounting-or-a-graded-exam-material-wxu9wcmkwf/15109880/
, 4 | Page Downloaded by: alinemutua2 ()
a-trademark b-copyright c-
franchise - SOLUTION=franchise
The practice of using the lower cost or market to value inventory reflects what
accounting principle? a-matching principle b-revenue recognition c-
conservatism d-Materiality - SOLUTION=Conservatism
This is the fair value of consideration given in excess of the fair value of the
identifiable net assets: a- earnings quality b-amortization c-depreciation d-
goodwill - SOLUTION=goodwill
in a periodic inventory system, the cost of purchases is debited to:
a-inventory b-accounts payable c-purchases
d-cost of goods sold - SOLUTION=purchases
The management's discussion & analysis section of the annual report can best be
described as:
a-independent but precise b-biased but informative c-
legalistic and lengthy d- Frank but objective -
SOLUTION=biased but informative
Koss Co. purchased a machine for $45,000 on 1/1/24. 4 years life, $5000 residual.
What is the DDB depreciation in year 1?
Document shared on https://www.docsity.com/en/docs/acct-301-intermediate-accounting-or-a-graded-exam-material-wxu9wcmkwf/15109880/
ACCT 301 – Intermediate Accounting | A+ Graded
Exam Material (2025/2026)
The method of inventory usually provides a better match of expenses with
revenues a-LIFO b-FIFO a-Weighted Average d- all of the above -
SOLUTION=LIFO
A company's market value is generally less than its book value
TRUE
FALSE - SOLUTION=false
what is the effect of the adjusting journal entry to write down inventory to its net
realizable value? a-Decrease net income. b-Decrease total assets.
c-Decrease total assets and net income. d-Increase retained earnings. -
SOLUTION=Decrease total assets and net income.
when a seller offers a right of return, which is true:
a-sales are net of estimated returns b-sales
are gross returns, returns are expenses c-sales
are net of actual returns
d-sales are gross of returns, returns are ignored - SOLUTION=sales are net of
estimated returns
which financial statement shows information for a point in time ONLY?
a-balance sheet b-income statement c- statement of cash flows
d-statement of shareholders equity - SOLUTION=balance sheet
Document shared on https://www.docsity.com/en/docs/acct-301-intermediate-accounting-or-a-graded-exam-material-wxu9wcmkwf/15109880/
,2 | Page
A company receiving a donated will record a(n):
a- increase in liabilities b-increase in revenue c-decrease in
assets d-decrease in liabilities - SOLUTION=an increase in
revenue
Collections of accounts receivable that previously have been written off result in
an increase in cash and an increase in:
a- accounts receivable b- bad debt expense c-allowance for
uncollectible accounts d- retained earnings - SOLUTION=Allowance for
uncollectible accounts
Jo paid $840 to Tot co. for a 6 month course that started on June 1. As of August 1,
the financial records would show:
a-$560 Revenue; $280 Accounts Receivable b-
$560 revenue; $280 Deferred Revenue c-$280
Revenue; $560 Accounts Receivable d-$280
Revenue; $280 Deferred Revenue -
SOLUTION=280 Revenue; $280 Deferred
Revenue
when FASB issues new accounting standards, they call them:
Document shared on https://www.docsity.com/en/docs/acct-301-intermediate-accounting-or-a-graded-exam-material-wxu9wcmkwf/15109880/
,3 | Page Downloaded by: alinemutua2 ()
a-Financial Technical Bulletins b-Financial Accounting Standards c-
Accounting Standards Updates d-Accounting Research Bulletins -
SOLUTION=Accounting Standards Updates
Which of the following is recorded by a credit to accounts receivable?
a-write off of bad debts b-sale of inventory on account c-estimating
the annual allowance for uncollectible accounts d-estimating annual
sales returns - SOLUTION=write off of bad debts
operating cash outflows would include:
a-Purchases of inventory b-Purchases of equipment c-payments
of cash dividends d-Purchase of investments -
SOLUTION=Purchases of inventory
When selling PP&E for cash, the seller recognizes:
a-The seller recognizes a gain or loss for the difference between cash received and
the fair value of the asset sold
b-The seller recognizes a gain or loss for the difference between cash received and
the book value of the asset sold c-The seller recognizes losses, but not gains
d-None of these choices are correct - SOLUTION=The seller recognizes a gain or
loss for the difference between cash received and the book value of the asset sold
The exclusion right to use a company's name and sell its product within a specified
geographic area is called:
Document shared on https://www.docsity.com/en/docs/acct-301-intermediate-accounting-or-a-graded-exam-material-wxu9wcmkwf/15109880/
, 4 | Page Downloaded by: alinemutua2 ()
a-trademark b-copyright c-
franchise - SOLUTION=franchise
The practice of using the lower cost or market to value inventory reflects what
accounting principle? a-matching principle b-revenue recognition c-
conservatism d-Materiality - SOLUTION=Conservatism
This is the fair value of consideration given in excess of the fair value of the
identifiable net assets: a- earnings quality b-amortization c-depreciation d-
goodwill - SOLUTION=goodwill
in a periodic inventory system, the cost of purchases is debited to:
a-inventory b-accounts payable c-purchases
d-cost of goods sold - SOLUTION=purchases
The management's discussion & analysis section of the annual report can best be
described as:
a-independent but precise b-biased but informative c-
legalistic and lengthy d- Frank but objective -
SOLUTION=biased but informative
Koss Co. purchased a machine for $45,000 on 1/1/24. 4 years life, $5000 residual.
What is the DDB depreciation in year 1?
Document shared on https://www.docsity.com/en/docs/acct-301-intermediate-accounting-or-a-graded-exam-material-wxu9wcmkwf/15109880/
