ACCT 201A Final Exam Review CSUF-
Questions with Verified Solutions
The original cost of a piece of equipment was $100,000. The equipment was depreciated using
the straight-line method with annual depreciation of $20,000. After two years, the fair value of
the equipment is $82,000. How much is the book value of the equipment at the end of the second
year? Correct Ans-60,000
The asset's cost less accumulated depreciation is called: Correct Ans-Book Value
What intangible asset is not amortized? Correct Ans-Goodwill
If equipment is retired, which of the following accounts would be debited? Correct Ans-
Accumulated depreciation.
Common shareholders usually have all of the following rights except: Correct Ans-To
participate in the day-to-day operations.
The advantages of a corporation compared to a sole proprietorship or partnership include
Correct Ans-Limited liability
The disadvantages of a corporation compared to a sole proprietorship or partnership include:
Correct Ans-Double taxation.
, What features could Preferred stock have Correct Ans-Can have features of both liabilities
and stockholders' equity
A stock dividend occurs when: Correct Ans-A company distributes to shareholders additional
shares of its own stock.
What is the primary reason for declaring a stock split? Correct Ans-Lower the trading price of
a stock into a more acceptable trading range.
What is the effect of a stock dividend on total stockholders' equity? Correct Ans-
Stockholders' equity does not change.
Salaries expense for the year equals $240,000. Salaries payable at the beginning of the year were
$25,000, and at the end of the year were $15,000. Calculate cash paid for salaries during the year.
Correct Ans-$250,000
The balance of cash at the beginning of the year was $120,000, and at the end of the year was
$140,000. Assuming operating cash flows equal $90,000 and investing cash flows equal
$(40,000), calculate financing cash flows for the year. Correct Ans-$(30,000).
What is an example of a cash outflow from a financing activity? Correct Ans-Payment of
cash dividend
Questions with Verified Solutions
The original cost of a piece of equipment was $100,000. The equipment was depreciated using
the straight-line method with annual depreciation of $20,000. After two years, the fair value of
the equipment is $82,000. How much is the book value of the equipment at the end of the second
year? Correct Ans-60,000
The asset's cost less accumulated depreciation is called: Correct Ans-Book Value
What intangible asset is not amortized? Correct Ans-Goodwill
If equipment is retired, which of the following accounts would be debited? Correct Ans-
Accumulated depreciation.
Common shareholders usually have all of the following rights except: Correct Ans-To
participate in the day-to-day operations.
The advantages of a corporation compared to a sole proprietorship or partnership include
Correct Ans-Limited liability
The disadvantages of a corporation compared to a sole proprietorship or partnership include:
Correct Ans-Double taxation.
, What features could Preferred stock have Correct Ans-Can have features of both liabilities
and stockholders' equity
A stock dividend occurs when: Correct Ans-A company distributes to shareholders additional
shares of its own stock.
What is the primary reason for declaring a stock split? Correct Ans-Lower the trading price of
a stock into a more acceptable trading range.
What is the effect of a stock dividend on total stockholders' equity? Correct Ans-
Stockholders' equity does not change.
Salaries expense for the year equals $240,000. Salaries payable at the beginning of the year were
$25,000, and at the end of the year were $15,000. Calculate cash paid for salaries during the year.
Correct Ans-$250,000
The balance of cash at the beginning of the year was $120,000, and at the end of the year was
$140,000. Assuming operating cash flows equal $90,000 and investing cash flows equal
$(40,000), calculate financing cash flows for the year. Correct Ans-$(30,000).
What is an example of a cash outflow from a financing activity? Correct Ans-Payment of
cash dividend
