Fall2011 Test2
Name ___________________________________________
Accounting 201 Unit Test II
Instructor: Tracy Gillis VERSION ONE Fall 2011 * You can take the exam apart if you wish, but return ALL pages, even if unused. * There are six multiple choice questions and four problems for a total of 35 marks. * Watch your time, 1.8 minutes per mark * Show all of your work on the blank pages provided. Do not crowd your work.
1. ___ | 2. ___ | 3. ___ | 4. ___ | 5. ___ | 6 ___ |
Multiple Choice (1.5 marks each – put the letter of the best answer in the box above) 1. In order for accounting information to be relevant, it must a. have very little cost. b. be used by a lot of different firms. c. not be reported to the public. d. have predictive or confirmatory value.
2. Current liabilities are usually listed a. after long-term debt on the balance sheet. b. in order of liquidity on the balance sheet. c. in order of maturity on the balance sheet. d. in increasing order of magnitude on the balance sheet.
3. Under Canadian GAAP for Private Enterprises (ASPE), if a contingent loss is deemed unlikely to occur, it should be a. recorded as a liability in the financial statements. b. disclosed in the notes to the financial statements. c. disclosed in the notes if the loss would result in a substantial negative effect on the company’s financial position. d. The potential loss should never be recorded or disclosed as its outcome is determined to be unlikely.
4. The accounting for warranty costs is based on the concept of matching expenses with revenues, which requires that the estimated cost of honouring warranty contracts should be recognized as an expense a. when the product is brought in for repairs. b. in the period in which the product was sold. c. at the end of the warranty period. d. only if the repairs are expected
Accounting 201 Unit Test II
Instructor: Tracy Gillis VERSION ONE Fall 2011 * You can take the exam apart if you wish, but return ALL pages, even if unused. * There are six multiple choice questions and four problems for a total of 35 marks. * Watch your time, 1.8 minutes per mark * Show all of your work on the blank pages provided. Do not crowd your work.
1. ___ | 2. ___ | 3. ___ | 4. ___ | 5. ___ | 6 ___ |
Multiple Choice (1.5 marks each – put the letter of the best answer in the box above) 1. In order for accounting information to be relevant, it must a. have very little cost. b. be used by a lot of different firms. c. not be reported to the public. d. have predictive or confirmatory value.
2. Current liabilities are usually listed a. after long-term debt on the balance sheet. b. in order of liquidity on the balance sheet. c. in order of maturity on the balance sheet. d. in increasing order of magnitude on the balance sheet.
3. Under Canadian GAAP for Private Enterprises (ASPE), if a contingent loss is deemed unlikely to occur, it should be a. recorded as a liability in the financial statements. b. disclosed in the notes to the financial statements. c. disclosed in the notes if the loss would result in a substantial negative effect on the company’s financial position. d. The potential loss should never be recorded or disclosed as its outcome is determined to be unlikely.
4. The accounting for warranty costs is based on the concept of matching expenses with revenues, which requires that the estimated cost of honouring warranty contracts should be recognized as an expense a. when the product is brought in for repairs. b. in the period in which the product was sold. c. at the end of the warranty period. d. only if the repairs are expected