Acct 212 Mid Term
Multiple choice
When preparing a bank reconciliation, which of the following items should be added to the book balance?
EFT receipts deposits in transit collection items both EFT receipts and collection items
Which of the following must be added to beginning Retained Earnings to compute ending Retained Earnings? net income expenses dividends all of these answers are correct
The use of the FIFO method increases taxable income: when prices are constant when prices are declining when prices are increasing under all circumstances
A company mistakenly destroys a unit of inventory that originally cost $12. The company included the cost of the destroyed unit in cost of goods sold on the income statement, rather than recognizing it as a loss. This action is justifiable based on: the revenue concept accounting conservatism the materiality concept none of the above answers. All of them are incorrect; according to GAAP, a separate loss must be recognized
When applying the lower-of-cost-or-market rule, market value generally refers to: fifo cost using the periodic method lifo cost using the periodic method current sales price of the inventory current replacement cost
A company performed services for a customer on account. This transaction increased assets and _______. decreased equity increased liabilities increased expenses increased revenues
The two methods of estimating uncollectible receivables are the: aging-of-receivables method and direct write-off method percent of sales method and the aging-of-receivables method allowance method and the direct write-off method percent of sales method and the direct write-off method
The use of the allowance method of accounting for bad debts is preferred over the direct write-off method because of the: matching principle historical cost principle revenue recognition principle full disclosure principle
For which form of business ownership are the owners of a business
When preparing a bank reconciliation, which of the following items should be added to the book balance?
EFT receipts deposits in transit collection items both EFT receipts and collection items
Which of the following must be added to beginning Retained Earnings to compute ending Retained Earnings? net income expenses dividends all of these answers are correct
The use of the FIFO method increases taxable income: when prices are constant when prices are declining when prices are increasing under all circumstances
A company mistakenly destroys a unit of inventory that originally cost $12. The company included the cost of the destroyed unit in cost of goods sold on the income statement, rather than recognizing it as a loss. This action is justifiable based on: the revenue concept accounting conservatism the materiality concept none of the above answers. All of them are incorrect; according to GAAP, a separate loss must be recognized
When applying the lower-of-cost-or-market rule, market value generally refers to: fifo cost using the periodic method lifo cost using the periodic method current sales price of the inventory current replacement cost
A company performed services for a customer on account. This transaction increased assets and _______. decreased equity increased liabilities increased expenses increased revenues
The two methods of estimating uncollectible receivables are the: aging-of-receivables method and direct write-off method percent of sales method and the aging-of-receivables method allowance method and the direct write-off method percent of sales method and the direct write-off method
The use of the allowance method of accounting for bad debts is preferred over the direct write-off method because of the: matching principle historical cost principle revenue recognition principle full disclosure principle
For which form of business ownership are the owners of a business