CSUF ACCT 201A (Hoffman) Final Exam
Solved Correctly To Score A+
Generally accepted accounting principles are: CORRECT ANSWERS a set of
standards and rules that are recognized as a general guide for financial reporting.
Which is an advantage of corporations relative to partnerships and sole proprietorships?
CORRECT ANSWERS Reduced legal liability for investors.
Kam Company has the following units and costs.
Inventory, Jan. 1 8,000 $11
Purchase, Jun. 19 13,000 $12
Purchase, Nov. 8 5,000 $13
If 9,000 units are on hand at December 31, what is the cost of the ending inventory
under FIFO? CORRECT ANSWERS $113,000
(total 309,000 - ((8,000*11)+(remaining 9,000*12))
To record the sale of goods for cash in a perpetual inventory system: CORRECT
ANSWERS two journal entries are necessary: one to record the receipt of cash and
sales revenue, and one to record the cost of goods sold and reduction of inventory.
Which is not one of the three primary business activities? CORRECT ANSWERS
Advertising.
A trial balance: CORRECT ANSWERS will not balance if a correct journal entry is
posted twice.
Which accounts normally have debit balances? CORRECT ANSWERS Assets,
dividends, and expenses.
Which account will have a zero balance after a company has journalized and posted
closing entries? CORRECT ANSWERS Service Revenue.
Adjustments for prepaid expenses: CORRECT ANSWERS decrease assets and
increase expenses.
Queenan Company computes depreciation on delivery equipment at $1,000 for the
month of June. The adjusting entry to record this depreciation is as follows: CORRECT
ANSWERS Depreciation Expense dr 1,000. Accumulated Depreciation-Equipment cr
1,000
A ledger: CORRECT ANSWERS is a record of all accounts maintained by a company
and their amounts.
, Net income will result during a time period when: CORRECT ANSWERS revenues
exceed expenses.
Davidson Electronics has the following:
Inventory, Jan. 1 5,000 $8
Purchase, April 2 15,000 $10
Purchase, Aug. 28 20,000 $12
If Davidson has 7,000 units on hand at December 31, the cost of ending inventory under
the average-cost method is: CORRECT ANSWERS $75,250
40,000+ 150,000+ 240,000 = 430,000
40,000 units
430,000/40,000 = 10.75
10.75 * 7,000
The element of a corporation's annual report that describes the corporation's accounting
methods is: CORRECT ANSWERS notes to the financial statements.
Gross profit will result if: CORRECT ANSWERS net sales are greater than cost of
goods sold.
As a result of a thorough physical inventory, Railway Company determined that it had
inventory worth $180,000 at December 31, 2022. This count did not take into
consideration the following facts. Rogers Consignment Store currently has goods worth
$35,000 on its sales floor that belong to Railway but are being sold on consignment by
Rogers. The selling price of these goods is $50,000. Railway purchased $13,000 of
goods that were shipped on December 27, FOB destination, that will be received by
Railway on January 3. Determine the correct amount of inventory that Railway should
report. CORRECT ANSWERS $215,000
(180,000+ 35,000)
The lower-of-cost-or-net realizable value rule for inventory is an example of the
application of: CORRECT ANSWERS the conservatism convention.
All of the following are required steps in the accounting cycle except: CORRECT
ANSWERS prepare financial statements from the unadjusted trial balance.
Which statement presents information as of a specific point in time? CORRECT
ANSWERS Balance sheet.
The following ratios are available for Reilly Inc. and O'Hare Inc.
Reily: Current Ratio 2:1 | Debt to Assets Ratio 75% | EPS $3.50
O'Hare: Curent Ratio 1.5:1 | Debt to Assets Ratio 40% | EPS $2.75
Compared to O'Hare Inc., Reilly Inc. has: CORRECT ANSWERS higher liquidity and
lower solvency, but profitability cannot be compared based on information provided.
Solved Correctly To Score A+
Generally accepted accounting principles are: CORRECT ANSWERS a set of
standards and rules that are recognized as a general guide for financial reporting.
Which is an advantage of corporations relative to partnerships and sole proprietorships?
CORRECT ANSWERS Reduced legal liability for investors.
Kam Company has the following units and costs.
Inventory, Jan. 1 8,000 $11
Purchase, Jun. 19 13,000 $12
Purchase, Nov. 8 5,000 $13
If 9,000 units are on hand at December 31, what is the cost of the ending inventory
under FIFO? CORRECT ANSWERS $113,000
(total 309,000 - ((8,000*11)+(remaining 9,000*12))
To record the sale of goods for cash in a perpetual inventory system: CORRECT
ANSWERS two journal entries are necessary: one to record the receipt of cash and
sales revenue, and one to record the cost of goods sold and reduction of inventory.
Which is not one of the three primary business activities? CORRECT ANSWERS
Advertising.
A trial balance: CORRECT ANSWERS will not balance if a correct journal entry is
posted twice.
Which accounts normally have debit balances? CORRECT ANSWERS Assets,
dividends, and expenses.
Which account will have a zero balance after a company has journalized and posted
closing entries? CORRECT ANSWERS Service Revenue.
Adjustments for prepaid expenses: CORRECT ANSWERS decrease assets and
increase expenses.
Queenan Company computes depreciation on delivery equipment at $1,000 for the
month of June. The adjusting entry to record this depreciation is as follows: CORRECT
ANSWERS Depreciation Expense dr 1,000. Accumulated Depreciation-Equipment cr
1,000
A ledger: CORRECT ANSWERS is a record of all accounts maintained by a company
and their amounts.
, Net income will result during a time period when: CORRECT ANSWERS revenues
exceed expenses.
Davidson Electronics has the following:
Inventory, Jan. 1 5,000 $8
Purchase, April 2 15,000 $10
Purchase, Aug. 28 20,000 $12
If Davidson has 7,000 units on hand at December 31, the cost of ending inventory under
the average-cost method is: CORRECT ANSWERS $75,250
40,000+ 150,000+ 240,000 = 430,000
40,000 units
430,000/40,000 = 10.75
10.75 * 7,000
The element of a corporation's annual report that describes the corporation's accounting
methods is: CORRECT ANSWERS notes to the financial statements.
Gross profit will result if: CORRECT ANSWERS net sales are greater than cost of
goods sold.
As a result of a thorough physical inventory, Railway Company determined that it had
inventory worth $180,000 at December 31, 2022. This count did not take into
consideration the following facts. Rogers Consignment Store currently has goods worth
$35,000 on its sales floor that belong to Railway but are being sold on consignment by
Rogers. The selling price of these goods is $50,000. Railway purchased $13,000 of
goods that were shipped on December 27, FOB destination, that will be received by
Railway on January 3. Determine the correct amount of inventory that Railway should
report. CORRECT ANSWERS $215,000
(180,000+ 35,000)
The lower-of-cost-or-net realizable value rule for inventory is an example of the
application of: CORRECT ANSWERS the conservatism convention.
All of the following are required steps in the accounting cycle except: CORRECT
ANSWERS prepare financial statements from the unadjusted trial balance.
Which statement presents information as of a specific point in time? CORRECT
ANSWERS Balance sheet.
The following ratios are available for Reilly Inc. and O'Hare Inc.
Reily: Current Ratio 2:1 | Debt to Assets Ratio 75% | EPS $3.50
O'Hare: Curent Ratio 1.5:1 | Debt to Assets Ratio 40% | EPS $2.75
Compared to O'Hare Inc., Reilly Inc. has: CORRECT ANSWERS higher liquidity and
lower solvency, but profitability cannot be compared based on information provided.
