Exam 1 Study Guide
Midterm 1 Practice Questions (Acct 201 Fall 2012)
1. Retained earnings at the end of the period is equal to a. retained earnings at the beginning of the period plus net income minus liabilities. b. retained earnings at the beginning of the period plus net income minus dividends. c. net income. d. assets plus liabilities.
2. Pinson Company began the year with retained earnings of $550,000. During the year, the company recorded revenues of $600,000, expenses of $380,000, and paid dividends of $140,000. What was Pinson’s retained earnings at the end of the year? a. $910,000 b. $630,000 c. $1,010,000 d. $480,000
3. Patent would appear in which balance sheet section?
a. Intangible assets
b. Investments
c. Property, plant, and equipment
d. Current assets
4. A balance sheet shows a. revenues, liabilities, and stockholders’ equity. b. expenses, dividends, and stockholders’ equity. c. revenues, expenses, and dividends. d. assets, liabilities, and stockholders’ equity.
5. For 2012 Fielder Corporation reported net income of $30,000; net sales $400,000; and average share outstanding 12,000. There were no preferred stock dividends. What was the 2012 earnings per share?
a. $2.33
b. $0.40
c. $33.33
d. $2.50
6. Use the following data to determine the total dollar amount of assets to be classified as current assets. Koonce Office Supplies Balance Sheet December 31, 2012 Cash $ 130,000 Accounts Payable $ 140,000 Prepaid Insurance 60,000 Salaries Payable 20,000 Accounts Receivable 100,000 Mortgage Payable 160,000 Inventory 140,000 Total Liabilities $320,000 Land held for Investment 150,000 Land 180,000 Buildings $200,000 Common Stock $240,000 Less Accumulated Retained Earnings 500,000 Depreciation (40,000) 160,000
1. Retained earnings at the end of the period is equal to a. retained earnings at the beginning of the period plus net income minus liabilities. b. retained earnings at the beginning of the period plus net income minus dividends. c. net income. d. assets plus liabilities.
2. Pinson Company began the year with retained earnings of $550,000. During the year, the company recorded revenues of $600,000, expenses of $380,000, and paid dividends of $140,000. What was Pinson’s retained earnings at the end of the year? a. $910,000 b. $630,000 c. $1,010,000 d. $480,000
3. Patent would appear in which balance sheet section?
a. Intangible assets
b. Investments
c. Property, plant, and equipment
d. Current assets
4. A balance sheet shows a. revenues, liabilities, and stockholders’ equity. b. expenses, dividends, and stockholders’ equity. c. revenues, expenses, and dividends. d. assets, liabilities, and stockholders’ equity.
5. For 2012 Fielder Corporation reported net income of $30,000; net sales $400,000; and average share outstanding 12,000. There were no preferred stock dividends. What was the 2012 earnings per share?
a. $2.33
b. $0.40
c. $33.33
d. $2.50
6. Use the following data to determine the total dollar amount of assets to be classified as current assets. Koonce Office Supplies Balance Sheet December 31, 2012 Cash $ 130,000 Accounts Payable $ 140,000 Prepaid Insurance 60,000 Salaries Payable 20,000 Accounts Receivable 100,000 Mortgage Payable 160,000 Inventory 140,000 Total Liabilities $320,000 Land held for Investment 150,000 Land 180,000 Buildings $200,000 Common Stock $240,000 Less Accumulated Retained Earnings 500,000 Depreciation (40,000) 160,000