ACCT 2113 1st Edition Final Exam Self-Study QuestionsChapters 1 - 121. Independent, private-sector group that is primarily responsible for setting financial reporting standards in the United States.a. FASB. c. SECb. IASB. d. IRS2. Consider the following account balances of Rexing & Rexroat Liquidators as of December31, 2009. Accounts Payable $ 4,400Cash 1,700Common Stock 2,400Office Supplies 4,300Customer Advances 2,300Retained Earnings 1,100Salaries Expense 12,800Service Revenue 8,300Utilities Expense 5,000How many of these accounts would appear on the company’s 2009 income statement?a. Five d. Twob. Four e. Sixc. ThreeThese notes represent a detailed interpretation of the professor’s lecture. GradeBuddy is best used as a supplement to your own notes, not as a substitute.3. From 2005 through 2009, Dexter Consulting Services reported the following annual net income and dividend amounts:Year Net Income Dividends2005 $22,000 $2,0002006 17,000 2,000 2007 9,000 1,0002008 14,000 3,000 2009 25,000 4,000If Dexter had Retained Earnings of $88,000 at the end of 2009, what was the company’s Retained Earnings at the beginning of 2005?a. $13,000 d. $41,000b. $23,000 e. some other amountc. $37,0004. Consider the following account balances of the Alfonso Bunker Company (ABC) as of December 31, 2009. Accounts Payable $ 4,400Cash 1,700Common Stock 2,400Equipment 4,300Retained Earnings 1,100Land 12,800Long-term Debt 8,300Construction Revenue 5,000Salaries Expense 4,200How many of these accounts would appear on ABC’s December 31, 2009 balance sheet?a. Fiveb. Fourc. Threed. Sixe. Seven5. Consider the following cash flow items: Pay amount owed to bank for previous borrowing.Pay utility costs.Purchase equipment to be used in operations.Purchase office supplies to be used the next month.Purchase one year of rent in advance.Pay workers salaries.Pay for research and development costs.Pay taxes to the IRS.Sell common stock to investors.How many of these cash flow items involve investing activities?a. Noneb. Onec. Twod. Threee. Four6. Refer to the list of cash items in Question 5. How many of those items involve financing activities? a. None c. Two e. Fourb. One d. Three7. Consider the following accounts:Common Stock Research ExpenseInterest Payable Salaries PayableLand Service RevenuePrepaid Rent Utilities ExpenseHow many of the above accounts are temporary accounts?a. Two c. Four e. Sixb. Three d. Five8. A trial balance can best be explained as a list of:a. The income statement accounts used to calculate net income.b. Revenue, expense, and dividend accounts used to show the balances of the components of retained earnings. c. The balance sheet accounts used to show the equality of the accounting equation.d. All accounts and their balances at a particular date.9. Assume that Youmba Surfboards had a retained earnings balance of $10,000 on April 1, 2009, and that the company had the following transactions during April 2009.Issued common stock for cash, $5,000.Provided services to customers on account, $2,000.Provided services to customers in exchange for cash, $900.Paid April rent, $800.Paid workers salaries for April, $700.What was Youmba’s retained earnings at the end of April?a. $11,400 c. $16,400b. $12,100 d. Some other amount10. Consider the follow list of accounts. Cash Retained EarningsService Revenue Utilities ExpenseAccounts Payable Common StockEquipment Treasury StockHow many of these accounts have a normal debit balance?a. Four c. Six e. Eightb. Five d. Seven11. Consider the follow list of accounts. Notes Payable Additional Paid-In CapitalSalaries Expense Retained EarningsAccounts Receivable Bonds PayableDepreciation ExpenseHow many of these accounts have a normal debit balance?a. Two c. Four e. Sixb. Three d. Five12. Consider the following accounts:Insurance Expense CashInterest Receivable Service RevenueAccumulated DepreciationHow many of these accounts are increased with credits?a. One c. Three e. Fiveb. Two d. Four13. Following are transactions of Cary & Conwell, Inc., a new company, during the month of January 2010.A. Issued 10,000 shares of common stock for $15,000 cash.B. Purchased land for $12,000, signing a note payable for the full amount.C. Purchased office equipment for $1,200 cash.D. Received cash of $14,000 for services provided to customers during the month.E. Purchased $300 of office supplies on account.F. Paid employees $10,000 for their first month’s salaries.How many of these transactions decreased this company’s total assets? a. One c. Three e. Fiveb. Two d. Four14. Which of the following transactions causes a decrease in stockholders’ equity?a. Pay dividends to stockholdersb. Obtain cash by borrowing from a local bank c. Provide services to customers on accountd. Write off an account receivablee. a & d15. Which best describes the purpose(s) of closing entries?a. Adjust the balances of asset and liability accounts for unrecorded activity during the period.b. Transfer the balances of temporary accounts to common stock.c. Reduce the balances of the temporary accounts to zero to prepare them for measuring activity in the next period.d. Both b and c.16. Which of the following accounts is not listed in a post-closing trial balance?a. Equipmentb. Allowance for Uncollectible Accountsc. Retained Earningsd. Accumulated Depreciation, Equipmente. All of the above are included in a post-closing trial balance17. “Received a $300 telephone bill in July 2009. The bill was for the month of June 2009. The bill was paid in August 2009.” This transaction resulted in an expense being recognized in July 2009.a. True b. FalseFacts for Questions 18-21: Pollard, Inc., prepares monthly financial statements for its bank. The company’s November 30 and December 31 adjusted trial balances included the following amounts. November 30 December 31 Debit Credit Debit CreditSupplies 2,200 2,800Prepaid Insurance 9,600 8,400Salaries Payable 4,000 5,000 Unearned Rent Revenue 5,000 4,000 18. Assume that Pollard purchased supplies of $1,700 during December. The company’s adjusting entry for supplies used during the month of December included aa.