Accounting 200 Final Exam Verified Questions And
Answers Rated A+
How to find how many Common Stock shares are outstanding? ANS C/S Outstanding= ( # of C.S.
shares issued/$per share ) - ( Treasury Stock/ CS shares )
How to Calculate Ending Retained Earnings? ANS End R.E. = ( Beg R.E. ) + ( Net Income ) - ( Cash
Dividends ) - ( Stock Dividends )
How to Calculate Stockholder Equity? ANS S.E. =
( C/S ) + ( Excess of par value C/S ) + ( P/S )
+ ( Excess of par value P/S ) + ( End R.E. ) - (Treasury Stock )
What are the effects of a 2:1 Stock split of Common Stock? ANS New Par Value = Old par value / 2
New Market Value = Old market value / 2
New # of Outstanding Shares = ( C.S. Outstanding ) x ( 2 )
Dollar value change to S.E. = None!
Operating Cash Flows: ANS Income Statement Items:
Cash Inflows: Sale of goods/services, interest/dividends received
Cash Outflows: to supplier for inventory, government for taxes, employees for services, lenders for
interest paid, others for expenses
Examples:
(-) Maintenance expense,
(-) Inventory bought,
,(-) Payment of interest,
(+) Cash sales
(+) Receipt of dividend income,
(-) Payment of income tax,
(-) Payment of merchandise,
(-) Wages Payable
(+) Receipt of interest income
Investing Cash Flows ANS Changes in Investments & Long-Term Assets:
Cash Inflows: Sale of PPE, sales of investments, collection on principle on loans to other entities
Cash Outflows: To purchase PPE, purchase in investments, making loans to other entities
Examples:
(-) Purchasing Land
(+) Proceeds from sale of vehicle
(-) Purchase of stocks in another company
(-) Purchase of equipment
(+) Proceeds from sale of investments
Financing Cash Flows: ANS Changes in Long-Term liabilities & stockholder equity:
Cash Inflows: sale of stocks, insurance of bad debt (Bonds/Notes)
Cash Outflows: payments to shareholders as dividends paid, redeem long term debt, required stock
(Treasury stock)
Examples:
(+) Sale of preferred stock
, (-) Repaid Long term Notes payable
(+) Proceeds from issuing a bond
(+) Proceeds from issuing common stock
(-) Repayment of bond principle
(-) Reacquire capital stock ( treasury stock )
How to find cash collected or paid in A/R & A/P: ANS +Beginning A/R or A/P
+Sales or Purchases
-Ending A/R or A/P
= Cash collected/paid of a year
Contract (stated or coupon) Rate > Market (discount or effective) Rate is considered a... ANS Bond is
issued at a Premium
Contract (stated or coupon) Rate < Market (discount or effective) Rate is considered a... ANS Bond is
issued at a Discount
Contract (stated or coupon) Rate = Market (discount or effective) Rate is considered a... ANS Bond is
issued at Face Value
Journal Entry to issue a Bond that SELLS at 103% is what... ANS Dr. Cash (=principle x 1.03)
Cr. Bonds Payable (=principle)
Cr. Premium on B/P (difference)
Journal Entry to issue a Bond that SELLS at 97% is what... ANS Dr. Cash (principle x 0.97)
Dr. Discount on B/P (difference)
Cr. Bonds Payable (principle)
Journal Entry for a Cash Dividend declared at declaration, record, and payment dates: ANS
Declaration Date: ( Liabilities ↑ ) ( Equity ↓ )
Answers Rated A+
How to find how many Common Stock shares are outstanding? ANS C/S Outstanding= ( # of C.S.
shares issued/$per share ) - ( Treasury Stock/ CS shares )
How to Calculate Ending Retained Earnings? ANS End R.E. = ( Beg R.E. ) + ( Net Income ) - ( Cash
Dividends ) - ( Stock Dividends )
How to Calculate Stockholder Equity? ANS S.E. =
( C/S ) + ( Excess of par value C/S ) + ( P/S )
+ ( Excess of par value P/S ) + ( End R.E. ) - (Treasury Stock )
What are the effects of a 2:1 Stock split of Common Stock? ANS New Par Value = Old par value / 2
New Market Value = Old market value / 2
New # of Outstanding Shares = ( C.S. Outstanding ) x ( 2 )
Dollar value change to S.E. = None!
Operating Cash Flows: ANS Income Statement Items:
Cash Inflows: Sale of goods/services, interest/dividends received
Cash Outflows: to supplier for inventory, government for taxes, employees for services, lenders for
interest paid, others for expenses
Examples:
(-) Maintenance expense,
(-) Inventory bought,
,(-) Payment of interest,
(+) Cash sales
(+) Receipt of dividend income,
(-) Payment of income tax,
(-) Payment of merchandise,
(-) Wages Payable
(+) Receipt of interest income
Investing Cash Flows ANS Changes in Investments & Long-Term Assets:
Cash Inflows: Sale of PPE, sales of investments, collection on principle on loans to other entities
Cash Outflows: To purchase PPE, purchase in investments, making loans to other entities
Examples:
(-) Purchasing Land
(+) Proceeds from sale of vehicle
(-) Purchase of stocks in another company
(-) Purchase of equipment
(+) Proceeds from sale of investments
Financing Cash Flows: ANS Changes in Long-Term liabilities & stockholder equity:
Cash Inflows: sale of stocks, insurance of bad debt (Bonds/Notes)
Cash Outflows: payments to shareholders as dividends paid, redeem long term debt, required stock
(Treasury stock)
Examples:
(+) Sale of preferred stock
, (-) Repaid Long term Notes payable
(+) Proceeds from issuing a bond
(+) Proceeds from issuing common stock
(-) Repayment of bond principle
(-) Reacquire capital stock ( treasury stock )
How to find cash collected or paid in A/R & A/P: ANS +Beginning A/R or A/P
+Sales or Purchases
-Ending A/R or A/P
= Cash collected/paid of a year
Contract (stated or coupon) Rate > Market (discount or effective) Rate is considered a... ANS Bond is
issued at a Premium
Contract (stated or coupon) Rate < Market (discount or effective) Rate is considered a... ANS Bond is
issued at a Discount
Contract (stated or coupon) Rate = Market (discount or effective) Rate is considered a... ANS Bond is
issued at Face Value
Journal Entry to issue a Bond that SELLS at 103% is what... ANS Dr. Cash (=principle x 1.03)
Cr. Bonds Payable (=principle)
Cr. Premium on B/P (difference)
Journal Entry to issue a Bond that SELLS at 97% is what... ANS Dr. Cash (principle x 0.97)
Dr. Discount on B/P (difference)
Cr. Bonds Payable (principle)
Journal Entry for a Cash Dividend declared at declaration, record, and payment dates: ANS
Declaration Date: ( Liabilities ↑ ) ( Equity ↓ )
