# Final Quiz Practice

Pages: 7 (1684 words) Published: February 20, 2013
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1. A company receives a 10%, 90-day note for \$1,500. The total interest due upon the maturity date is: (Points : 1) |        \$37.50
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2. A company receives a 6.2%, 60-day note for \$9,650. The total amount of cash due on the maturity date is: (Points : 1) |
\$9,749.72
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3. The amount due on the date of maturity for a \$6,000, 60-day 8%, note receivable is: (Points : 1) |           \$6,080
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4. Plant assets are: (Points : 1) |

Used in operations
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5. Once the estimated depreciation expense for an asset is calculated: (Points : 1) |        It may be revised based on new information
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6. When originally purchased, a vehicle had an estimated useful life of 8 years. The vehicle cost \$23,000 and its estimated salvage value is \$1,500. After 4 years of straight-line depreciation, the asset's total estimated useful life was revised from 8 years to 6 years and there was no change in the estimated salvage value. The depreciation expense in year 5 equals: (Points : 1) |        \$5,375.00

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7. A company's annual accounting period ends on December 31. During the current year a depreciable asset which cost \$24,000 was purchased on October 1. The asset has a \$1,000 estimated salvage value. The company uses straight-line depreciation and expects the asset to have a 6-year life. What is the total depreciation expense for the current year? (Points : 1) |             \$958.33|

8. Both the straight-line depreciation method and the double-declining-balance depreciation method: (Points : 1) |        Produce the same total depreciation over an asset's useful life      | 9. Total asset turnover is used to evaluate: (Points : 1) |        The efficiency of management's use of assets to generate sales| 10. Dell had net sales of \$35,404 million. Its average total assets for the period were \$14,502 million. Dell's total asset turnover is equal to: (Points : 1) |              2.44|

11. A depreciation method in which a plant asset's depreciation expense for a period is determined by applying a constant depreciation rate each period to the asset's beginning book value is called: (Points : 1) |              Declining-balance depreciation|

12. A company purchased a machine for \$970,000. The machine has a useful life of 12 years and a residual value of \$4,500. It is estimated that the machine could produce 1,000,000 units over its useful life. In the first year, 200,000 units were produced. In the second year, production increased to 300,000 units. Using the units-of-production method, what is the book value of this asset at the end of the second year of operations? (Points : 1) |

\$487,250
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13. Another name for a capital expenditure is: (Points : 1) |              Balance sheet expenditure
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14. A company issued 60 shares of \$100 par value stock for \$7,000 cash. The total amount of contributed capital in excess of par is: (Points : 1) |
\$1,000|
15. A discount on bonds payable: (Points : 1) |
Occurs when a company issues bonds with a contract rate less than the market rate| 16. Which of the following is true regarding the effective interest amortization method? (Points : 1) |              Allocates bond interest expense using a constant interest rate| 17. Stockholders' equity consists of: (Points : 1) |

Contributed capital and retained earnings|
18. Preferred stock on which the right to receive dividends is forfeited for any year that the dividends are not declared is referred to as: (Points : 1) |              Noncumulative preferred stock

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19. Shamrock Company had net income of \$30,000. On January 1, there were 8,000 shares of common stock outstanding. On April 1, the company issued an additional 2,000 shares of common stock. The company declared a \$2,700 dividend on its noncumulative, nonparticipating preferred...

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