ACCTG 215 Fall 2013 Practice Quiz 1 Solutions Name Student Number TA Quiz Section Time Instructions There are 10 multiple choice questions and 5 quantitative questions on the following pages Your final answers must be entered in the spaces provided on this cover page in order to be graded Code of Conduct By signing below you acknowledge that you are a member of a learning community at the Foster School of Business that is committed to the highest academic standards and that you adhered to these standards while completing this quiz Specific to this quiz by signing below you acknowledge that you did not receive or give help to others nor did you witness others receiving or giving help to others during the quiz By signing below I affirm that I have not received assistance from any other student that I have not provided assistance to any other students and that I have not witnessed any students acting unethically during the administration of this quiz Signature Signature required Date Multiple Choice Answers 1 2 E 6 3 B 7 A 8 D 12 14 15 5 C B 9 E Quantitative Answers 11 12 300 4 200 4 B 10 A D 13 6 800 25 800 20 000 1 ACCTG 215 Fall 2013 Multiple Choice Questions 1 point each Be sure to record your answers in the spaces provided on the cover sheet 1 IASB stands for which of the following a b c d e International Accounting Statements and Bylaws Internal Audit Standards Board Institutional Accounting Standards Board Internal Accounting Statements and Bylaws None of the above Answer E Lecture 1 and Chapter 1 2 GoGo Company recorded the following transaction 1 14 13 Cash 2 000 Unearned Revenue 2 000 Which of the following best describes the above transaction a b c d e Revenue was earned and cash was received Cash was received for goods services to be provided in the future Cash was paid out to pay for the liability Unearned Revenue The Revenue account was decreased and cash was paid out None of the above Answer B Lectures 3 4 and Chapter 3 3 Uknow Company s Stockholders Equity totaled 55 000 at the beginning of fiscal 2012 During fiscal 2012 Uknow issued new stock for 5 000 cash and declared and paid a cash dividend totaling 10 000 At the end of fiscal 2012 Uknow reported net income of 15 000 What is the balance of Uknow s Stockholders Equity at the beginning of fiscal 2013 a b c d e 55 000 65 000 75 000 85 000 None of the above Answer B Lecture 4 and Chapter 3 2 ACCTG 215 Fall 2013 4 On November 1 2011 UCan Company prepaid 60 000 of rent to use an office building for 5 years The building is the only place that UCan rents On the December 31 2011 financial statements prepaid rent was 58 000 What is prepaid rent on the December 31 2012 Balance Sheet a b c d e 48 000 12 000 46 000 0 None of the above Answer C Lecturer 4 and Chapter 3 5 A current asset is defined as a An asset to be consumed sold or converted to cash within one year or the firm s operating cycle whichever is shorter b An asset to be consumed sold or converted to cash within one year or the firm s operating cycle whichever is longer c An asset that is linked to a specific current liability account d An asset to be consumed sold or converted to cash within 90 days e Cash and other highly liquid investments Answer B Lecture 4 and Chapter 3 6 Which accounts increase when debited a b c d e Accounts Receivable Utilities Expense and Equipment Cash Accounts Payable and Utilities Expense Service Revenue Notes Payable and Stockholders Equity Prepaid Rent Stockholders Equity and Service Revenue Accounts Payable Prepaid Rent and Utilities Expense Answer A Lecturers 3 4 and Chapter 2 7 On the Statement of Cash Flows which of the following is a financing activity and is a cash inflow a b c d e Pay employee salaries of 9 500 Pay cash dividends to shareholders of 1 200 Purchase machinery for production for 15 700 Sell shares of common stock for 20 000 Receive cash from customer to pay off account receivable of 3 000 3 ACCTG 215 Fall 2013 Answer D Chapter 4 8 On June 1 2012 BumpIt Studios provided music recording services to Johnny and billed Johnny 5 000 BumpIt debited the total amount to Accounts Receivable At the end of the month BumpIt received a payment of 2 500 from the customer What is the journal entry BumpIt will record at the end of the month when the company receives the payment a Cash b c d e Revenue Accounts Receivable Revenue Cash Accounts Receivable Accounts Receivable Unearned Revenue Cash Accounts Receivable 5 000 5 000 5 000 5 000 5 000 5 000 2 500 2 500 2 500 2 500 Answer E Lecture 4 and Chapter 3 9 Which of the following is one of the five components of internal control provided by the Committee of Sponsoring Organizations COSO a b c d e Information and communication Organization Separation of duties Performance reviews Preparing financial statements Answer A Lecture 6 and Chapter 4 10 Which of the following does not adjust a company s cash balance when doing a bank reconciliation a b c d e NSF Check Note Received Service Fee Deposit s Outstanding All of the above are adjustments that would be made to a company s cash balance when doing a bank reconciliation 4 ACCTG 215 Fall 2013 Answer D Lecture 6 and Chapter 4 Numeric Questions 1 point each Be sure to record your final answers in the spaces provided on the cover sheet Use the following information for the next two questions VeryNear is a new company that opened for business on January 1 2012 On September 20 2012 VeryNear paid out dividends of 700 At the end of the year on December 31 2012 VeryNear reported Net Income of 3 000 and prepared the following trial balance all of VeryNear s accounts are shown Accounts Common Stock Accounts Payable Retained earnings Accounts Receivable Land Equipment Salaries Payable Cash Supplies Debits Credits 10 000 4 000 5 000 2 000 2 000 1 500 3 000 11 What amount will VeryNear report as total Owners Equity on its December 31 2012 balance sheet Answer 12 300 0 700 3 000 10 000 12 What is VeryNear s Land account balance on December 31 2012 Answer 6 800 Given the answer to 11 liabilities and owners equity add up to 18 300 The assets listed add up to 11 500 Since assets must be equal to liabilities plus owners equity land must be 6 800 5 ACCTG 215 Fall 2013 Use the following information for the next two questions On March 1 2012 HusKey Company had Accounts Receivable of 5 200 Cash of 12 000 and Unearned Revenue of 2 000 HusKey recorded the following transactions during …