ACC 101 Midterm Practice Exam # 1

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Quiz by , created over 5 years ago

ACC 101 Midterm Practice Exam # 1

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Created by smjackson7 over 5 years ago
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Question 1

Question
Stockholders’ equity is affected by the ____________________
Answer
  • a. Purchase of an asset for cash
  • b. Payment of a liability
  • c. Collection of accounts receivable
  • d. Declaration and payment of a dividend

Question 2

Question
2. Which of the following accounts has a normal debit balance?
Answer
  • a. Utilities Expense
  • b. Retained Earnings
  • c. Design Revenue
  • d. Accounts Payable

Question 3

Question
3. Platt Realty Corporation had the following balance sheet accounts and balances: Accounts Payable $6,000 Common Stock ? Accounts Receivable ? Equipment $7,000 Building 1,000 Land 7,000 Cash 3,000 Retained Earnings 2,000 If the balance in the Accounts Receivable was $17,000, what would be the total liabilities and stockholders’ equity?
Answer
  • a. $17,000
  • b. $27,000
  • c. $32,000
  • d. $35,000

Question 4

Question
4. Which of the following accounts is decreased with a credit
Answer
  • a. Salaries Payable
  • b. Unearned Management Fees
  • c. Accounts Receivable
  • d. Retained Earnings

Question 5

Question
5. Dexter Company accepts an advance fee of $500 for services to be performed next year. The entry to record this transaction would include a:
Answer
  • a. Debit to Accounts Receivable
  • b. Credit to Unearned Service Fees
  • c. Credit to Cash
  • d. Credit to Service Fees Earned

Question 6

Question
The primary purpose of the trial balance is to test the:
Answer
  • a. Equality of debit and credit entries in the journal
  • b. Recording of transactions
  • c. Equality of debit and credit balances in the ledger
  • d. Analysis of transactions.

Question 7

Question
7. Which of the following accounts probably would need to be adjusted at year end?
Answer
  • a. Supplies
  • b. Land
  • c. Dividends
  • d. Notes Payable

Question 8

Question
8. Which of the following is most likely to appear on the balance sheet as a current asset?
Answer
  • Buildings
  • Merchandise Inventory
  • Accumulated Depreciation
  • Common Stock

Question 9

Question
9. If Accounts Receivable has debit posting of $29,000, credit postings of $22,000, and a normal ending balance of $24,000, which of the following was its beginning balance?
Answer
  • $17,000 debit
  • $31,000 credit
  • $31,000 debit
  • $17,000 credit

Question 10

Question
10. A $4,000 machine is purchased by paying $1,000 cash and issuing a promissory note for the remainder. The entry should include a:
Answer
  • Credit to Notes Payable
  • Debit to Cash
  • Credit to Notes Receivable
  • d. Credit to Machinery

Question 11

Question
11. After all closing entries have been posted, which of the following accounts is most likely to have a non zero balance?
Answer
  • Income Summary
  • Service Revenue
  • Wages Payable
  • Interest Expense

Question 12

Question
12. Which of the following transactions is most likely not to result in an adjusting entry at the end of the period?
Answer
  • Purchase of a two year insurance policy
  • Payment of this month’s rent
  • Purchase of office equipment
  • Performance of a service for which payment was received in advance.

Question 13

Question
13. When a company receives an electric bill but does not pay it right away it should
Answer
  • Debit Utilities Expense and credit Accounts Receivable
  • Make no entry until the bill is paid
  • Debit Utilities Expense and credit Accounts Payable
  • Debit Accounts Payable and credit Utilities Expense

Question 14

Question
14. The entry for the expiration of prepaid advertising, originally recorded as an asset, consists of a debit to
Answer
  • Advertising Expense and a credit to Prepaid Advertising
  • Prepaid Advertising and a credit to Cash
  • Advertising expense and a credit to Cash
  • Prepaid Advertising and a credit to Advertising Expense

Question 15

Question
15. Which of the following could not possibly be a closing entry?
Answer
  • Debit Income Summary and credit Dividends
  • Debit Income Summary and credit Retained Earnings
  • Debit Retained Earnings and credit Dividends
  • Debit Retained Earnings and credit Income Summary

Question 16

Question
16. Current assets divided by current liabilities is known as the
Answer
  • Profit margin
  • Current ratio
  • Working capital
  • Asset turnover

Question 17

Question
17. Gross margin equals the difference between net sales and:
Answer
  • Net income
  • Cost of goods sold plus operating expenses
  • Operating expenses
  • Cost of goods sold

Question 18

Question
Cailor Corporation provides food services to universities. Its account balances (all normal) are provided below in alphabetical order for the month ended July 31, 2007. The Cailor Corporation, Retained Earnings account balance represents the balance as of June 30, 2007; all other account balances are as of July 31, 2007. ------------------------------------------------------------------
Answer
  • A) Income Statement B)Statement of Retained Earnings c) Balance Sheet (unclassified)
  • Do Above Work

Question 19

Question
Depreciation Expense appears on the Balance Sheet
Answer
  • True
  • False

Question 20

Question
Buildings appear on the balance sheet as a current asset?
Answer
  • True
  • False

Question 21

Question
Merchandise Inventory appears on the balance sheet as a current asset.
Answer
  • True
  • False