These are the automatically computed results of your exam Grades for essay questions and comments from your instructor are in the Details section below Date Taken Time Spent Points Received 42 min 22 secs 145 5 150 Of Questions Correct 30 2 30 N A Grading Summary Question Type Multiple Choice Essay Grade Details Page 1 2 3 1 Question TCO A B C External users want answers to all of the following questions except Student Answer Is the company earning satisfactory income Will the company be able to pay its debts as they come due Did the company use a budget to plan its expenses How does the company compare in profitability with competitors Chapter 1 page 6 3 of 3 Instructor Explanation Points Received Comments 2 Question Student Answer delivering activity investing activity financing activity operating activity Instructor Explanation Chapter 1 page 9 Points Received Comments 3 of 3 TCO C Issuing shares of stock in exchange for cash is an example of a n 3 Question TCO C Which activities involve putting the resources of the business into action to generate a profit 4 Question TCO A Resources owned by a business are referred to as Student Answer stockholders equity Student Answer Delivering Financing Investing Instructor Explanation Operating Chapter 1 page 10 Points Received Comments 3 of 3 liabilities assets revenues Chapter 1 page 9 3 of 3 Instructor Explanation Points Received Comments 5 Question TCO C Jamie Company recorded the following cash transactions for the year Paid 70 000 for salaries Paid 20 000 to purchase office equipment Paid 6 000 for utilities Paid 7 000 in dividends Collected 130 000 from customers What was Jamie s net cash provided by operating activities Student Answer 47 000 54 000 27 000 33 000 Instructor Explanation 130 000 70 000 6 000 54 000 Chapter 1 page 10 Points Received Comments 3 of 3 6 Question Student Answer TCO A On a classified balance sheet prepaid insurance is classified as an intangible asset property plant and equipment a current asset a long term investment Instructor Explanation Chapter 2 page 49 Points Received Comments 3 of 3 7 Question TCO A Which of the following should not be classified as a current asset Student Answer Supplies Short term Marketable securities Prepaid insurance that will expire next year A Note Receivable that will mature after 21 months Instructor Explanation Chapter 2 page 49 Points Received Comments 3 of 3 8 Question TCO A These are selected account balances on December 31 2007 Land location of the corporation s office building 200 000 Land held for future use 300 000 Corporate Office Building 1 200 000 Inventory 400 000 Equipment 900 000 Office Furniture 200 000 Accumulated Depreciation 600 000 What is the total NET amount of property plant and equipment that will appear on the balance sheet Student Answer 1 900 000 2 600 000 2 200 000 3 200 000 Instructor Explanation Gross cost of plant assets utilized accumulated depreciation Chapter 2 page 51 Points Received Comments 3 of 3 9 Question Student Answer TCO B For 2010 Mossland Corporation reported net income of 28 000 net sales 400 000 and average share outstanding 6 000 There were no preferred stock dividends What was the 2010 earnings per share Instructor Explanation 28 000 6 000 4 67 Chapter 2 page 56 Points Received Comments 3 of 3 10 Question Student Answer TCO B At December 31 2010 Shorts Company had retained earnings of 2 184 000 During 2010 they issued stock for 98 000 and paid dividends of 34 000 Net income for 2010 was 402 000 The retained earnings balance at the beginning of 2010 was 4 67 0 25 66 67 14 86 2 552 000 1 816 000 1 914 000 2 454 000 Instructor Explanation 2 184 000 402 000 34 000 1 816 000 Chapter 2 page 57 Points Received Comments 3 of 3 11 Question TCO D On March 1 2010 Dillon Company hires a new employee who will start the work on March 6 The employee will be paid on the last day of each month Should a journal entry be made on March 6 Why or why not Student Answer Yes the company is now obligated to pay the employee thus that event must be recorded on March 6 No hiring an employee is an important event however it is not an economic event that should be recorded on March 6 Yes failure to record the event on March 6 would cause the financial statements to be misleading No the journal entry should be made on March 1 which is the 12 Question TCO D Which one of the following is not a part of an account Student Answer Instructor Explanation Chapter 3 page 108 date of hiring Points Received Comments 3 of 3 Credit side Trial balance Debit side Title Instructor Explanation Chapter 3 page 111 Points Received Comments 3 of 3 13 Question Student Answer TCO D The classification and normal balance of the dividend account is a revenue with a credit balance an expense with a debit balance a liability with a credit balance under stockholders equity with a debit balance Instructor Explanation Chapter 3 page 116 Points Received Comments 3 of 3 14 Question TCO D A debit is not the normal balance for which account listed below Student Answer Dividends Cash Accounts Receivable Service Revenue Instructor Explanation Chapter 3 page 116 Points Received Comments 3 of 3 15 Question Student Answer Instructor Explanation Chapter 3 page 111 Points Received Comments 3 of 3 TCO D Which of the following is not always true of the terms debit and credit They can be abbreviated as Dr and Cr Debit means increase and Credit means decrease They can be used to describe the balance of an account They can be interpreted to mean left and right of an account Page 1 2 3 Grading Summary Question Type Multiple Choice Essay Grade Details Page 1 2 3 1 Question These are the automatically computed results of your exam Grades for essay questions and comments from your instructor are in the Details section below Date Taken Time Spent Points Received 42 min 22 secs 145 5 150 Of Questions Correct 30 2 28 N A TCO E The time period assumption states that Student Answer a transaction can only affect one period of time estimates should not be made if a transaction affects more than one time period adjustments to the enterprise s accounts can only be made in the time period when the business terminates its operations the economic life of a business can be divided into artificial time 2 Question TCO E In a service type business revenue is considered earned Instructor Explanation Chapter 4 page 164 periods 3 of 3 Points Received Comments Student Answer Instructor Explanation Chapter 4 page 164 Points