ACCTG 215 Fall 2013 Quiz 1 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 C 6 3 A 7 E 8 E 12 14 15 5 B D 9 D Quantitative Answers 11 10 500 6 500 4 B 10 B C 13 3 500 50 000 8 800 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 Which of the following bodies enforces GAAP A B C D E Internal Revenue Service Financial Accounting Standards Board Securities and Exchange Commission International Financial Reporting Standards None of the above Answer C 2 Which of the following best defines stockholders equity A B C D E The residual interest in the assets once all liabilities are satisfied The total investment in other companies stocks Economic resources owned by the company The sum of assets and liabilities None of the above Answer A 3 Transactions of a company that include getting a loan from a bank are referred to as A B C D E Investing Activities Financing Activities Expenditure Activities Operating Activities None of the above Answer B 2 ACCTG 215 Fall 2013 4 Pumpkin Inc sold 500 in pumpkins to a customer on account on August 1 2013 On August 11 2013 Pumpkin collected the cash from that customer What is the impact on Pumpkin s accounting equation on August 11th from the collection of cash A B C D E Assets decrease by 500 and liabilities increase by 500 No net effect on the accounting equation Assets increase by 500 and liabilities increase by 500 Assets decrease by 500 and stockholders equity decreases by 500 Stockholders equity increases by 500 and assets increase by 500 Answer B 5 The Dividends Payable account appears in which financial statement A B C D E Statement of Cash Flows Income Statement Statement of Liabilities Balance Sheet Statement of Stockholders Equity Answer D 6 Squash Inc recorded the following transaction 9 23 13 Accounts Receivable Service Revenue 17 000 17 000 Which of the following best describes the above transaction A Revenue was earned for a cash payment made earlier in the year B A service was provided to a customer for cash C A service will be provided to a customer in the future when cash is received D Accounts Receivable decreased and a service was provided to a customer E A service was provided to a customer on account Answer E 3 ACCTG 215 Fall 2013 7 Which of the following is not a criteria for the revenue recognition principal A B C D E Delivery has occurred or services have been rendered There is persuasive evidence of an arrangement for customer payment The price is fixed or determinable Collection is reasonably assured The customer has a pre existing contract with the company Answer E 8 On December 31 2012 Mashed Company paid 12 000 for insurance that covers January 1 2013 through June 30 2013 What is the journal entry that Mashed Company recorded on December 31 2012 A Insurance Expense Cash B Prepaid Insurance Cash C Insurance Expense Cash D Prepaid Insurance Cash E No Entry 2 000 2 000 2 000 2 000 12 000 12 000 12 000 12 000 Answer D 9 On 12 1 12 Potato Bakery s Accounts Receivable balance is 20 000 On 12 4 12 Potato Bakery purchases 2 000 of baking supplies on account On 12 10 12 Potato Bakery sells 4 000 of cakes on account On 12 17 12 Potato Bakery receives 3 000 cash for sales made in the past If no other transactions occur in the month of December what will Potato Bakery s Accounts Receivable balance be at 12 31 2012 A B C D E 23 000 21 000 19 000 26 000 24 000 Answer B 4 ACCTG 215 Fall 2013 10 On September 1 2013 Onion Inc owned land with a value of 400 000 recorded on the balance sheet On September 15 2013 Onion sells this land for 480 000 cash What is the journal entry Onion will record on September 15 A Cash 480 000 Land B Cash Gain 480 000 400 000 80 000 Land C Cash 480 000 480 000 Land Gain D Cash Revenue Land E None of the above 400 000 80 000 400 000 80 000 480 000 Answer C 5 ACCTG 215 Fall 2013 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 three questions Turkey Inc has the following trial balance as of January 1 2013 Accounts Common Stock Accounts Payable Retained Earnings Accounts Receivable Inventory Land Buildings Loan Payable Salaries Payable Cash Supplies to be used in 3 months Debits Credits 7 000 34 000 4 000 2 500 40 000 10 000 2 000 8 000 3 000 500 Turkey has the following transactions during the month of January assume no other transactions take place 1 On January 16 2013 Turkey purchases inventory for 1 500 on account 2 On January 20 2013 Turkey pays 500 of its loan payable balance 3 On January 26 2013 customers pay Turkey 1 000 cash for services that were provided in 2012 11 What is Turkey s Accounts Payable balance on January 31 2013 Answer 10 500 9 000 1 500 12 What is Turkey s Cash balance on January 31 2013 Answer 3 500 3 000 500 1 000 13 What is Turkey s total non current asset balance on January 31 2013 Answer 50 000 40 000 10 000 6 ACCTG 215 Fall 2013 14 On April 1 2013 Zucchini Inc issued 2 000 shares of stock with a par value of 0 50 per share to one investor for 7 500 cash What does Zucchini Inc record as additional paid in capital for this transaction Answer 6 500 7 500 0 50 2 000 15 The following events occurred in the month of September for Carrot Company 1 On September 2 2013 Carrot Company sold and delivered carrots to Stu for 3 500 on account 2 On September 6 …