Urgent help needed please!!Questions about the upcoming accounting exam!Explanation preferred please:)?

1.In the beginning of the year, Retained Earning balance was 40,000, during the year recognized revenue was 200,000, expenses was 150,000, dividends 30,000, what's the ending retained earning?

a.40,000

b.60,000

c.10,000

d.Can't be determined

#2. A General Journal

a.Contains one record for each of asset,liability,ect,acounts

b.Contains a list of transactions and other events,expenses in terms of debits and credits

#3.Harward Corp.purchased products from Connect Inc FBO shipping point, what transaction should be recorded?

a.Harward Freight in

b.Connect Freight out

c.Both A and B

#4.Company A :

Cash $100

A/R $500

Stock Equity $700

A/P $200

Equipment $300

What's the working capital and current ratio??

#5.Sequl company has the record showing: Account receivable(Dr)60,000 Allowance for uncollection account(Cr) 2000 Net sales(Cr) 500,000, the uncollectable amount is 2% of net sale,Allowance for uncollection account has a credit balance of $2000, what's the uncollectable account expense for this year?

#6.Lower of cost or market basis of valuing inventories is an example of:

a.Matching Principle

b.Consistency

c.The cost principle

d.Comparability

e.Conservatism

#7. A corporation is going to pay dividends to their shareholers, preferred stock is being 5%$100 par value, preferred stock and there are 100,000 shares authorized and 10,000 is issued.

a.Each share of authorized preferred stock will receive 5% of total amount of dividends being paid .

b.Each share of issued preferred stock will receive appropriate amount of dividend if and only if the common share holder's claim to dividends are fully satisfied.

c.Each share of authorized preferred stock will receive the appropriate amount of dividends if and only if common share holders claim to dividends has been fully satisfied.

d.Preferred shareholder will receive the appropriate of dividends to any consideration for common stock.

#8. Sigma Corp has 100,000 authorized stocks 60,000 shares outstanding. The shares were orginally issued at$25 each, assume Sigma requires 6000 shares of their own common stocks to hole in the Treasury $1600 per share, with this purchase, what will be the impact to total stock equity?

a.Decrease

b.Increase

c.No change

d.Can't be determined

#9.On 11/1 Sigma paid $7200 for one year rent in advance,what would appear on adjusted trail balance presented on 12/31?

a.prepaid rent 1200

b.prepaid rent 6000

c. rent expense 1200

d.rent expense 6000

#10.....Revenue be matched to expense is what principle?

#11. ABC company purchased a truck for 1000 in cash, what result is right?

a.Net income reduced by 1000

b.Amount of equity desecrated

#12. "Gains" on sales of treasury stock using the cost method

a.paid-in capital of treasury stock

b.capital stock

c.Retained earning

#13.An increase in inventory balance if use indirect method in reconsecration would be:

a.Cash outflow form investing activity

b.Cash outflow from financing activity

c.Addition to net income

d. Deduction from net income

(**some part of the question might not be complete, i couldn't write down the notes fast enough as the teacher's fast lecture :P so please try to understand :)

2 Answers

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  • 7 years ago
    Best Answer

    1.

    Beginning balance 40,000

    Plus revenue 200,000

    Minus expenses (150,000)

    Minus dividends (30,000)

    Equals ending balance 60,000

    2.

    The answer is b.

    3.

    the answer is (a), because Harward owned the goods as soon as they left Connect.

    4.

    Working capital is cash 100 + A/R 500 = 600

    Current ratio is 600 / 200 = 3:1

    5.

    This year's expense is 500,000 x 2% = 10,000

    6.

    The answer is (e). Lower of cost or market makes sure that inventory is not overvalued.

    7.

    The answer is (d). Preferred stockholders are paid their dividends before the common stockholders.

    8.

    Total stockholders' equity would decrease by 6,000 x 1,600 = 9,600,000. This is more than the original stock issue (60,000 x 25 = 1,500,000). Could the price of the treasury stock have been

    16 per share? That would cause a decrease of 96,000.

    9.

    Both (b) and (c) are correct. 1,200 (two months) rent would have expired and the expense recorded.

    10.

    Matching

    11.

    b. Equity decreased by 1,000

    12.

    The answer is (a). The "gain" is recorded as additional paid-in capital.

    13.

    The answer is (d). The increase in inventory is deducted from net income when reconciling net income to cash flows from operating activities.

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    3 years ago

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