ACC 311 Exam #2 Questions And
Answers Already Graded A+
How should an unusual event that is material be disclosed in the financial statements?
A. Shown as a separate item in operating revenues or expenses and supplemented by
a footnote if deemed appropriate.
B. Shown after ordinary net earnings but before extraordinary items.
C. Shown in operating revenues or expenses but not shown as a separate item.
D. Shown after extraordinary items net of income tax but before net earnings
CORRECT ANSWERS A. Shown as a separate item in operating revenues or expenses
and supplemented by a footnote if deemed appropriate.
Quarry Company enters into a contract with Eclipse Manufacturing to purchase a large
piece of machinery. Thecontract includes both the machine and installation for a single
total contract sales price. Quarry does not havethe specialized expertise to install the
machine, and Eclipse commonly includes installation as part of the singlecontract price
it quotes its customers. How should Eclipse allocate the contract price to the
performanceobligation(s)?
A. The contract price should be allocated to the installation and the machine should be
capitalized.
B. The entire sales price for the contract should be allocated to a single performance
obligation.
C. The sales price for the contract should be split between the machine and the
installation based on the proportion of service hours represented by each. CORRECT
ANSWERS B. The entire sales price for the contract should be allocated to a single
performance obligation.
Intraperiod tax allocation is used for all of the following except:
A. unusual gains/losses.
B. results of operations of a component that has been disposed of.
C. changes in accounting principle.
D. gain or loss from the disposal of a component of a business CORRECT ANSWERS
A. unusual gains/losses.
Gains and losses that bypass net income but affect stockholders' equity are referred to
as:
A. prior period income.
B. unusual gains and losses.
C. other comprehensive income.
D. prior period adjustments CORRECT ANSWERS C. other comprehensive income.
Which of the following is not classified as an unusual and infrequent gain or loss?
A. A discontinued operation.
B. Impairment losses on intangible assets.
, C. Flood damage losses to property.
D. Losses from inventory write-downs CORRECT ANSWERS A. A discontinued
operation.
A company is not required to report a per share amount on the face of the income
statement for which one ofthe following items?
A. Net income
B. Prior period adjustment
C. Continuing operations
D. Discontinued operations CORRECT ANSWERS B. Prior period adjustment
A statement of stockholders' equity can include a column for each of the following
except
A. accumulated other comprehensive income.
B. common stock.
C. net income.
D. retained earnings. CORRECT ANSWERS C. net income.
For Ivanhoe Company, the following information is available:Cost of goods sold
$394,550 Dividend revenue 19,100 Income tax expense 37,700 Operating expenses
147,000 Sales revenue 607,000 In Ivanhoe's single-step income statement, gross profit
A. should be reported at $231,550.
B. should not be reported.
C. should be reported at $212,450.
D. should be reported at $56,800 CORRECT ANSWERS B. should not be reported.
Carla Vista Co.'s 2025 income from continuing operations before income taxes was
$279,000. Carla Vista Co.reported before-tax income on discontinued operations of
$90,000. All tax items are subject to a 20% tax rate.Carla Vista's 2025 income
statement would report income tax expense of
A. $18,000.
B. $73,800.
C. $55,800.
D. $37,800. CORRECT ANSWERS C. $55,800.
Oriole Company reported the following information for 2025:Sales revenue $2,039,000
Cost of goods sold 1,400,000 Operating expenses 230,000 Unrealized holding gain on
available-for-sale debt securities 118,100 Cash dividends received on the securities
7,800 For 2025, Oriole would report other comprehensive income (ignoring tax effects)
A. $125,900.
B. $409,000.
C. $416,800.
D. $118,100 CORRECT ANSWERS D. $118,100
Which of the following would be added back to net income in the operating activities
section of the statement ofcash flows?
Answers Already Graded A+
How should an unusual event that is material be disclosed in the financial statements?
A. Shown as a separate item in operating revenues or expenses and supplemented by
a footnote if deemed appropriate.
B. Shown after ordinary net earnings but before extraordinary items.
C. Shown in operating revenues or expenses but not shown as a separate item.
D. Shown after extraordinary items net of income tax but before net earnings
CORRECT ANSWERS A. Shown as a separate item in operating revenues or expenses
and supplemented by a footnote if deemed appropriate.
Quarry Company enters into a contract with Eclipse Manufacturing to purchase a large
piece of machinery. Thecontract includes both the machine and installation for a single
total contract sales price. Quarry does not havethe specialized expertise to install the
machine, and Eclipse commonly includes installation as part of the singlecontract price
it quotes its customers. How should Eclipse allocate the contract price to the
performanceobligation(s)?
A. The contract price should be allocated to the installation and the machine should be
capitalized.
B. The entire sales price for the contract should be allocated to a single performance
obligation.
C. The sales price for the contract should be split between the machine and the
installation based on the proportion of service hours represented by each. CORRECT
ANSWERS B. The entire sales price for the contract should be allocated to a single
performance obligation.
Intraperiod tax allocation is used for all of the following except:
A. unusual gains/losses.
B. results of operations of a component that has been disposed of.
C. changes in accounting principle.
D. gain or loss from the disposal of a component of a business CORRECT ANSWERS
A. unusual gains/losses.
Gains and losses that bypass net income but affect stockholders' equity are referred to
as:
A. prior period income.
B. unusual gains and losses.
C. other comprehensive income.
D. prior period adjustments CORRECT ANSWERS C. other comprehensive income.
Which of the following is not classified as an unusual and infrequent gain or loss?
A. A discontinued operation.
B. Impairment losses on intangible assets.
, C. Flood damage losses to property.
D. Losses from inventory write-downs CORRECT ANSWERS A. A discontinued
operation.
A company is not required to report a per share amount on the face of the income
statement for which one ofthe following items?
A. Net income
B. Prior period adjustment
C. Continuing operations
D. Discontinued operations CORRECT ANSWERS B. Prior period adjustment
A statement of stockholders' equity can include a column for each of the following
except
A. accumulated other comprehensive income.
B. common stock.
C. net income.
D. retained earnings. CORRECT ANSWERS C. net income.
For Ivanhoe Company, the following information is available:Cost of goods sold
$394,550 Dividend revenue 19,100 Income tax expense 37,700 Operating expenses
147,000 Sales revenue 607,000 In Ivanhoe's single-step income statement, gross profit
A. should be reported at $231,550.
B. should not be reported.
C. should be reported at $212,450.
D. should be reported at $56,800 CORRECT ANSWERS B. should not be reported.
Carla Vista Co.'s 2025 income from continuing operations before income taxes was
$279,000. Carla Vista Co.reported before-tax income on discontinued operations of
$90,000. All tax items are subject to a 20% tax rate.Carla Vista's 2025 income
statement would report income tax expense of
A. $18,000.
B. $73,800.
C. $55,800.
D. $37,800. CORRECT ANSWERS C. $55,800.
Oriole Company reported the following information for 2025:Sales revenue $2,039,000
Cost of goods sold 1,400,000 Operating expenses 230,000 Unrealized holding gain on
available-for-sale debt securities 118,100 Cash dividends received on the securities
7,800 For 2025, Oriole would report other comprehensive income (ignoring tax effects)
A. $125,900.
B. $409,000.
C. $416,800.
D. $118,100 CORRECT ANSWERS D. $118,100
Which of the following would be added back to net income in the operating activities
section of the statement ofcash flows?
