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Title : Webster MC Graw COnnect BUSN 5600 QUiz 1
Multiple choice Questions and Calculations - Accounting
• BUSN 5600 QUIZ 1. Current U.S. Generally Accepted Accounting Principles and auditing standards require the financial statements of an entity for the reporting period to include: a. Earnings and gross receipts of cash for the period. b. Projected earnings for the subsequent period. c. Financial position at the end of the period. d. Current fair values of all assets at the end of the period. 2. Which of the following statements about the Financial Accounting Standards Board is correct? a. The FASB is an agency of the Federal government. b. The FASB has the authority to fine a noncompliant firm. c. The FASB follows a due process procedure that permits input from interested parties before a standard is issued. d. The FASB is controlled by the American Institute of CPA's. e. None of the above statements is correct. 3. Major classifications of accounting activity would not include: a. financial accounting, internal auditing, public accounting. b. internal auditing, governmental accounting, managerial accounting. c. financial accounting, national accounting, cost accounting. d. auditing, income tax accounting, governmental accounting. 4. The distinction between a current asset and other assets: a. is based on how long the asset has been owned. b. is based on amounts that will be paid to other entities within a year. c. is based on the ability to determine the current fair value of the asset. d. is based on when the asset is expected to be converted to cash, or used to benefit the entity. 5. Accumulated depreciation on a balance sheet: a. is part of stockholders' equity. b. represents the portion of the cost of an asset that is assumed to have been "used up" in the process of operating the business. c. represents cash that will be used to replace worn out equipment. d. recognizes the economic loss in value of an asset because of its age or use. 6. The provisions of the Sarbanes-Oxley Act of 2002 had the following components: a. Enforce auditing. b. Attestation. c. Quality control. d. None of the above are provisions. 7. Which of the following entities would not require accounting information pertaining to their economic activities? a. Social clubs. b. Not-for-profit entities. c. State governments. d. All of the above require accounting information. e. None of the above requires accounting information. 8. Total assets were $76,000 and total liabilities were $41,000 at the beginning of the year. Net income for the year was $15,000, and dividends of $4,500 were declared and paid during the year. Required: Calculate total stockholders’ equity at the end of the year. (Deductible amounts should be indicated by a minus sign.) 9. Stockholders’ equity totaled $94,000 at the beginning of the year. During the year, net income was $24,000, dividends of $9,000 were declared and paid, and $22,000 of common stock was issued at par value. Required: Calculate total stockholders’ equity at the end of the year. (Deductible amounts should be indicated by a minus sign.) 10. During the year, net sales were $137,000; gross profit was $56,000; net income was $23,000; income tax expense was $5,600; and selling, general, and administrative expenses were $25,000. Required: Calculate cost of goods sold, income from operations, income before taxes, and interest expense. 11. During the year, cost of goods sold was $49,000; income from operations was $47,000; income tax expense was $8,900; interest expense was $6,900; and selling, general, and administrative expenses were $31,000. Required: Calculate net sales, gross profit, income before taxes, and net income.