Quiz for Chapters 1,2 & 3

Instructions
Please read the questions carefully.

This assessment is worth 15 points.

  1. The FASB's standard-setting process included, in the following order:
       (1 point)

    a.  
    b.  
    c.  
    d.  

  2. CPAs are licensed by:
       (1 point)

    a.  
    b.  
    c.  
    d.  

  3. The conceptual framework's qualitative characteristic of relevance includes:
       (1 point)

    a.  
    b.  
    c.  
    d.  

  4. Financial reporting objectives do not include providing information:
       (1 point)

    a.  
    b.  
    c.  
    d.  

  5. Mega Loan Company has very stringent credit requirements and, accordingly, has negligible losses from uncollectible accounts. The company's independent accountants did not protest when, contrary to GAAP, the company recorded bad debts expense only when specific accounts were determined to be uncollectible, rather than use an allowance for uncollectible accounts. The concept demonstrated is:
       (1 point)

    a.  
    b.  
    c.  
    d.  

  6. Which of the following accounts has a debit balance?
       (1 point)

    a.  
    b.  
    c.  
    d.  

  7. Bland Foods purchased a two-year fire and extended coverage insurance policy on August 1, 2003, and charged the $4,200 premium to Insurance expense. At its December 31, 2003, year-end, Bland Foods would record which of the following adjusting entries?
       (1 point)

    a.  
    b.  
    c.  
    d.  

  8. On September 1, 2003, Time Magazine sold 600 one-year subscriptions for $81 each. The total amount received was credited to Unearned subscriptions revenue. What would be the required adjusting entry at December 31, 2003?
       (1 point)

    a.  
    b.  
    c.  
    d.  

  9. In its first year of operations Acme Corp. had income before tax of $400,000. Acme made income tax payments totaling $150,000 during the year and has an income tax rate of 40%. What would be the balance in income tax payable at the end of the year?
       (1 point)

    a.  
    b.  
    c.  
    d.  

  10. Cal Farms reported supplies expense of $2,000,000 this year. The supplies account decreased by $200,000 during the year to an ending balance of $400,000. What was the cost of supplies the Cal Farms purchased during the year?
       (1 point)

    a.  
    b.  
    c.  
    d.  

  11. Current assets include cash and all other assets expected to become cash or be consumed:
       (1 point)

    a.  
    b.  
    c.  
    d.  

  12. Accrued expenses:
       (1 point)

    a.  
    b.  
    c.  
    d.  

  13. Working capital is equal to:
       (1 point)

    a.  
    b.  
    c.  
    d.  

  14. The following is a partial balance sheet ($$$ in thousands) for Paisano Seafood Inc. is shown below.

    Reference: Ref. 3-7

    The acid-test ratio is:
       (1 point)

    a.  
    b.  
    c.  
    d.  

  15. Listed below are account balances (in $millions) taken from the records of Symphony Stores. All of these are permanent accounts, except the last two that have yet to be closed. The installment receivables are current. Symphony uses a perpetual inventory system.

    Reference: Ref. 3-9

    What is the amount of working capital for Symphony?
       (1 point)

    a.  
    b.  
    c.  
    d.  



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