Practice Exam
BCOR201
Practice Exam I with Answers
Problem 1 Multiple Choice Questions (2 Points each)
1. If assets are $99,000 and liabilities are $32,000, then equity equals:
A) $ 32,000. B) $ 99,000. C) $ 67,000. D) $131,000. E) $198,000.
Answer: C Calculation: Equity = $99,000 - $32,000 = $67,000
2. A debit is:
A) An increase in an account. B) The right-hand side of a T-account. C) A decrease in an account. D) The left-hand side of a T-account. E) An increase to a liability account.
Answer: D
3. Accounting is an information and measurement system that:
A) Identifies business activities. B) Records business activities. C) Communicates business activities. D) Helps people make better decisions. E) All of the above.
Answer: E
4. The primary objective of financial accounting is:
A) To provide financial statements to help external users analyze and interpret an organization's activities. B) To serve the decision-making needs of internal users. C) To monitor and control company activities. C) To provide information on both the costs and benefits of managing products and services. D) To know what, when, and how much to produce. E) None of the above.
Answer: A
5. Jan 15, Wal-mart sold a sofa to customer Danna on credit. The price of the sofa is $200. According to financing contract, Danna will pay $200 to Wal-mart 6 month later. Which accounting principle would prescribe that Wal-mart record $200 sale price as sales revenue on Jan 15?
A) Matching principle. B) Going-concern principle. C) Revenue recognition principle. D) All of the above. E) None of the above.
Answer: C
6. The area of accounting aimed at serving the decision making needs of internal users is:
A) Financial accounting. B) Managerial accounting. C) External auditing. D) SEC reporting. E) Governmental accounting.
Answer: B
Practice Exam I with Answers
Problem 1 Multiple Choice Questions (2 Points each)
1. If assets are $99,000 and liabilities are $32,000, then equity equals:
A) $ 32,000. B) $ 99,000. C) $ 67,000. D) $131,000. E) $198,000.
Answer: C Calculation: Equity = $99,000 - $32,000 = $67,000
2. A debit is:
A) An increase in an account. B) The right-hand side of a T-account. C) A decrease in an account. D) The left-hand side of a T-account. E) An increase to a liability account.
Answer: D
3. Accounting is an information and measurement system that:
A) Identifies business activities. B) Records business activities. C) Communicates business activities. D) Helps people make better decisions. E) All of the above.
Answer: E
4. The primary objective of financial accounting is:
A) To provide financial statements to help external users analyze and interpret an organization's activities. B) To serve the decision-making needs of internal users. C) To monitor and control company activities. C) To provide information on both the costs and benefits of managing products and services. D) To know what, when, and how much to produce. E) None of the above.
Answer: A
5. Jan 15, Wal-mart sold a sofa to customer Danna on credit. The price of the sofa is $200. According to financing contract, Danna will pay $200 to Wal-mart 6 month later. Which accounting principle would prescribe that Wal-mart record $200 sale price as sales revenue on Jan 15?
A) Matching principle. B) Going-concern principle. C) Revenue recognition principle. D) All of the above. E) None of the above.
Answer: C
6. The area of accounting aimed at serving the decision making needs of internal users is:
A) Financial accounting. B) Managerial accounting. C) External auditing. D) SEC reporting. E) Governmental accounting.
Answer: B