Devry ACCT 504 Midterm Exam Latest
ACCT 504 keller
Acct Fin: Managerial Use,Anlys 11091
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: 6/1/2014
Time Spent: 2 h , 28 min , 30 secs
Points Received: 140 / 150 (93.3%)
Question Type: # Of Questions: # Correct:
Multiple Choice 10 9
Essay 4 N/A
Grade Details – All Questions
Question 1. Question : (TCOs A, B, and C) Which of the following statements concerning users of accounting information is incorrect?
The marketing vice president is considered an internal user.
Present and prospective creditors are considered external users.
Regulatory authorities, such as the SEC, are considered internal users.
The IRS is considered an external user.
Question 2. Question : (TCO C) Paying back long-term debt is an example of a(n)
non-cash investing activity.
Question 3. Question : (TCO A) Resources owned by a business are referred to as
Question 4. Question : (TCO A) On a classified balance sheet, prepaid expenses are classified as
property, plant, and equipment.
Question 5. Question : (TCO B) For 2012, LBJ Corporation reported net income of $40,000; net sales $1,400,000; and weighted average shares outstanding of 10,000. There were no preferred stock dividends. What was the 2012 earnings per share?
Question 6. Question : (TCO D) Which of the following describes the normal balance and classification of the dividends account?
debit, Stockholders’ equity
Question 7. Question : (TCO E) The accrual accounting term used to indicate an item paid in advance or the receipt of cash in advance is
Question 8. Question : (TCOs A and B) A perpetual inventory system would most likely be used by a(n)
mom and pop convenience store.
Question 9. Question : (TCOs A and B) LBJ Company recorded the following events involving a recent purchase of merchandise.
– Received goods for $100,000, terms 2/10, n/30
– Returned $5,000 of the shipment for a credit due to damaged goods
– Paid $1,500 for freight in
– Paid the invoice within the discount period
As a result of these events, the company’s merchandise inventory
increased by $96,500.
increased by $95,000.
increased by $94,500.
increased by $94,600.
Question 10. Question : (TCO A) In periods of rising prices, which of the following inventory methods results in the lowest income taxes?
Average cost method
Cannot determine based on the information given
Question 11. Question : (TCO D) Describe the process of preparing a trial balance. What is the purpose of preparing a trial balance? If a trial balance does not balance, identify what might be the reasons why it does not balance. If the trial balance does balance, does that ensure that the ledger accounts are correct? Explain.
Question 12. Question : (TCOs B and E) The Caltor Company gathered the following condensed data for the Year Ended December 31, 2010.
Cost of goods sold $ 710,000
Net sales 1,279,000
Administrative expenses 239,000
Interest expense 68,000
Dividends paid 38,000
Selling expenses 45,000
1: Prepare a multiple-step income statement for the year ended December 31, 2010.
2: Compute the profit margin ratio and gross profit rate. Caltor Company’s assets at the beginning of the year were $770,000 and were $830,000 at the end of the year. To qualify for full credit, you must state the formula you are using, show your computations, and explain your findings.
Question 13. Question : (TCO D and E) Please prepare the following journal entries. Indicate which account should be debited and which account should be credited, along with the dollar amount of the debit and credit.
a: Investors invest $600,000 in exchange for 30,000 shares of common stock.
b: Company paid rent of $3,000.
c: Company billed $5,000 for services performed.
d: Company purchased supplies of $3,000.
e: Company received $20,000 for services not yet performed.
Question 14. Question : (TCO D) Your friend Dean has hired you to evaluate the following internal control procedures.
a: Explain to your friend whether each of the numbered items below is an internal control strength or weakness. You must also state which principle relates to each of the internal controls.
b: For the weaknesses, you also need to state a recommendation for improvement.
1: Bonding of the cashiers is not required because all of the cashiers have significant experience.
2: The treasurer is the only one allowed to sign checks.
3: All employees may operate cash registers.
4: Blank checks are stored in the safe.
5: Supervisors count cash receipts daily.
Devry ACCT 504 Midterm Exam Latest