Managerial Accounting
Quiz Questions for Chapter 1
1. Waverly Company paid $5,000 cash for wages of production workers. This business event would: a. increase total assets and total equity. b. increase one asset account and decrease another asset account. c. decrease total assets and total equity. d. decrease one asset account and increase an equity account.
2. Warren Company makes candy. During the most recent accounting period, Warren paid $3,000 for raw materials, $4,000 for labor, and $2,000 for overhead costs that were incurred to make candy. Warren started and completed 10,000 units of candy, of which 7,000 were sold. Based on this information, Warren would recognize which of the following amounts of expense on the income statement? a. $2,700 b. $6,300 c. $7,200 d. $9,000.
3. Bandera Manufacturing Company paid cash for wages of production workers. Which of the following choices accurately reflects how this event would affect the company’s financial statements?
| |Assets |= |Liab. |+ |Equity | |Rev. |- |Exp. |= |Net Inc. | | |a. | |+ ( | |NA | |NA | |NA | |+ | |( | | |b. | |( | |NA | |( | |NA | |+ | |( | | |c. | |+ ( | |NA | |NA | |NA | |NA | |NA | | |d. | |( | |NA | |( | |NA | |NA | |NA | | | | | | | | | | | | | | | | | |
4. Carson Manufacturing Company paid cash for commissions paid to sales staff. Which of the following choices accurately reflects how this event would affect the company’s financial statements?
| |Assets |= |Liab. |+ |Equity | |Rev. |( |Exp. |= |Net Inc. | | |a. | |+ ( | |NA | |NA | |NA | |NA | |NA | | |b. | |( | |NA | |( | |NA | |+ | |( | | |c. | |( | |NA | |( | |NA | |NA | |NA | | |d. | |+ ( | |NA | |NA | |NA | |+ | |( | | | | | | | | | | | | | | | | | |
5. Shelling Company owns $30,000 of manufacturing equipment. The equipment has a 10-year useful life and a $6,000 salvage value. Shelling uses straight-line depreciation. During the most recent annual accounting period the
1. Waverly Company paid $5,000 cash for wages of production workers. This business event would: a. increase total assets and total equity. b. increase one asset account and decrease another asset account. c. decrease total assets and total equity. d. decrease one asset account and increase an equity account.
2. Warren Company makes candy. During the most recent accounting period, Warren paid $3,000 for raw materials, $4,000 for labor, and $2,000 for overhead costs that were incurred to make candy. Warren started and completed 10,000 units of candy, of which 7,000 were sold. Based on this information, Warren would recognize which of the following amounts of expense on the income statement? a. $2,700 b. $6,300 c. $7,200 d. $9,000.
3. Bandera Manufacturing Company paid cash for wages of production workers. Which of the following choices accurately reflects how this event would affect the company’s financial statements?
| |Assets |= |Liab. |+ |Equity | |Rev. |- |Exp. |= |Net Inc. | | |a. | |+ ( | |NA | |NA | |NA | |+ | |( | | |b. | |( | |NA | |( | |NA | |+ | |( | | |c. | |+ ( | |NA | |NA | |NA | |NA | |NA | | |d. | |( | |NA | |( | |NA | |NA | |NA | | | | | | | | | | | | | | | | | |
4. Carson Manufacturing Company paid cash for commissions paid to sales staff. Which of the following choices accurately reflects how this event would affect the company’s financial statements?
| |Assets |= |Liab. |+ |Equity | |Rev. |( |Exp. |= |Net Inc. | | |a. | |+ ( | |NA | |NA | |NA | |NA | |NA | | |b. | |( | |NA | |( | |NA | |+ | |( | | |c. | |( | |NA | |( | |NA | |NA | |NA | | |d. | |+ ( | |NA | |NA | |NA | |+ | |( | | | | | | | | | | | | | | | | | |
5. Shelling Company owns $30,000 of manufacturing equipment. The equipment has a 10-year useful life and a $6,000 salvage value. Shelling uses straight-line depreciation. During the most recent annual accounting period the