ACC 290 Sample Final Exam Questions & Answers 100% correct | 2022 update

ACC 290 Sample Final Exam 1) Which financial statement is used to determine cash generated from operations? Answer: Statement of cash flows 2) In terms of sequence, in what order must the four basic financial statements be prepared? Answer: Income statement, capital statement, balance sheet, and statement of cash flows 3. In classifying transactions, which of the following is true in regard to assets? Answer: Normal balances and increases are debits 4. An increase in an expense account must be Answer: debited 5. ABC Corporation issues 100 shares of $1 par common stock at $5 per share, which of the following is the correct journal entry? Answer: Cash $500, Paid-in-Capital, Excess of Par 400, Common Stock $ 500 6. In the first month of operations, the total of the debit entries to the cash account amounted to $1,400 and the total of the credit entries to the cash account amounted to $600. The cash account has a Answer: $800 debit balance 7. Which ledger contains control accounts? Answer: General ledger 8. Smith is a customer of ABC Corporation. Smith typically purchases merchandise from ABC on account. Which ledger would ABC use to keep track of the details of Smith’s account? Answer: Accounts receivable subsidiary ledger 9. Under the cash basis of accounting Answer: cash must be received before revenue is recognized 10. Under the accrual basis of accounting Answer: events that change a company’s financial statements are recognized in the period they occur rather than in the period in which the cash is paid or received 11. The Vintage Laundry Company purchased $6,500 worth of laundry supplies on June 2 and recorded the purchase as an asset. On June 30, an inventory of the laundry supplies indicated only $2,000 on hand. The adjusting entry that should be made by the company on June 30 is Answer: debit Laundry Supplies Expense, $4,500; credit Laundry Supplies, $4,500 12. Greese Company purchased office supplies costing $4,000 and debited Office Supplies for the full amount. At the end of the accounting period, a physical count of office supplies revealed $1,100 still on hand. The appropriate adjusting journal entry to be made at the end of the period would be This study source was downloaded by from CourseH on :16:13 GMT -06:00 Answer: debit Office Supplies Expense, $2,900; credit Office Supplies, $2,900 13. Based on the account balance below, what is the total of the debit and credit columns of the adjusted trial balance? Service Revenue = $3300 Cash 1525 Unearned Revenue = 5320 Salary = 1050 Common Stock = 390 Equipment = $6400 Prepaid Insurance = 1225 Depreciated expenses = 640 Accumulated Depreciation = 1280 Retained Earnings = 550 Answer: $ 10, 840 14. An adjusted trial balance Answer: proves the equality of the total debit balances and total credit balances of ledger accounts after all adjustments have been made 15. Given the following adjusted trial balance: Debit Credit Cash 781 Accounts receivable 1,049 Inventory 1,562 Prepaid Rent 43 Property, Plant& Equipment 150 Accumulated depreciation 23 Accounts Payable 41 Unearned Revenue 21 Common Stock 60 Retained earnings 3,305 Service revenue 177 Interest revenue 43 Salary expense 113 Total $3,698 $3,698 Net income for the year is Answer: $135 16. Given the following adjusted trial balance, what will be the totals for the debit and credit columns of the post-closing trial balance? Answer: $7,170 17. Given the following adjusted trial balance: Answer: $3,354 This study source was downloaded by from CourseH on :16:13 GMT -06:00 18. Net income is recorded on the work sheet under the Answer: debit column of the income statement and the credit column of the balance sheet 19. At the beginning of the year, Uptown Athletic had an inventory of $400,000. During the year, the company purchased goods costing $1,500,000. If Uptown Athletic reported ending inventory of $600,000 and sales of $2,000,000, their cost of goods sold and gross profit rate would be Answer: $1,300,000 and 35% 20. During the year, Sarah’s Pet Shop’s merchandise inventory decreased by $30,000. If the company’s cost of goods sold for the year was $450,000, purchases would have been Answer: $420,000 21. At the beginning of the year, Wildcat Athletic had an inventory of $200,000. During the year, the company purchased goods costing $700,000. If acc 290 final exam Wildcat Athletic reported ending inventory of $300,000 and sales of $1,000,000, their cost of goods sold and gross profit rate would be Answer: $600,000 and 40% 22. The entry to record of sale of $900 with terms of 2/10, n/30 will include a Answer: credit to Sales Revenue for $900 23.Dobler Company uses a periodic inventory system. Details for the inventory account for the month of January 2012 are as follows: An end of the month (1/31/2012), inventory showed that 140 units were on hand. If the company uses LIFO, what is the value of the ending inventory? Answer: $700 24. The difference between ending inventory using LIFO and ending inventory using FIFO is referred to as Answer: LIFO reserve 25. A consistent application of an inventory costing method enhances Answer: comparability 26. The accountant at Patton Company has determined that income before income taxes amounted to $11,000 using the FIFO costing assumption. If the income tax rate is 30% and the amount of income taxes paid would be $300 acc290 final exam greater if the LIFO assumption were used, what would be the amount of income before taxes under the LIFO assumption? Answer: $12,000 27. A very small company would have the most difficulty in implementing which of the following internal control activities? Answer: Separation of duties This study source was downloaded by from CourseH on :16:13 GMT -06:00 28. A system of internal control Answer: can be rendered ineffective by employee collusion 29. The custodian of a company asset should Answer: not have access to the accounting record for that asset 30. The Sarbanes Oxley Act (2002) applies to Answer: U.S. and international companies This study source was downloaded by from CourseH on :16:13 GMT -06:00 Powered by TCPDF ()