ACC 291 Final Exam

Topics: Balance sheet, Generally Accepted Accounting Principles, Expense Pages: 10 (2547 words) Published: November 11, 2014
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ACC 291 Final Exam 100% Correct
1.The Sarbanes-Oxley Act requires that all publicly traded companies maintain a system of internal controls. Internal controls can be defined as a plan to A.safeguard assets
B.monitor balance sheets
C.control liabilities
D.evaluate capital stock
2. The purchase of treasury stock
A. decreases common stock authorized
B. decreases common stock issued
C. decreases common stock outstanding
D. has no effect on common stock outstanding
3. Marsh Company has other operating expenses of $240,000. There has been an increase in prepaid expenses of $16,000 during the year, and accrued liabilities are $24,000 lower than in the prior period. Using the direct method of reporting cash flows from operating activities, what were Marsh's cash payments for operating expenses? A. $228,000

B. $232,000
C. $200,000
D. $280,000
4. In performing a vertical analysis, the base for cost of goods sold is A. total selling expenses
B. net sales
C. total revenues
D. total expense
5. Blanco, Inc. has the following income statement (in millions): BLANCO, INC.
Income Statement
For the Year Ended December 31, 2011
Net Sales .............................. $200
Cost of Goods Sold .............................. 120
Gross Profit .............................. 80
Operating Expenses .............................. 44
Net Income .............................. $ 36
Using vertical analysis, what percentage is assigned to Net Income? A. 100%
B. 82%
C. 18%
D. 25%
6. Where would the event purchased land for cash appear, if at all, on the indirect statement of cash flows? A. Operating activities section
B. Investing activities section
C. Financing activities section
D. Does not represent a cash flow
7. Dawson Company issued 500 shares of no-par common stock for $4,500. Which of the following journal entries would be made if the stock has a stated value of $2 per share? A.
Cash ........................................................... $4,500 Common Stock 4,500
B.
Cash .................................... $4,500
Common Stock 1,000
Paid-In Capital in Excess of Par 3,500
C.
Cash ...................... $4,500
Common Stock 1,000
Paid-In Capital in Excess of Stated Value 3,500
D.
Common Stock ........................................................... $4,500 Cash 4,500
8. Andrews, Inc. paid $45,000 to buy back 9,000 shares of its $1 par value common stock. This stock was sold later at a selling price of $6 per share. The entry to record the sale includes a A. credit to Paid-In Capital from Treasury Stock for $9,000

B. credit to Retained Earnings for $9,000
C. debit to Pain-In Capital from Treasury Stock for $45,000
D. debit to Retained Earnings for $45,000
9. Which of the following is a fundamental factor in having an effective, ethical corporate culture? A. Efficient oversight by the company’s Board of Directors B. Workplace ethics
C. Code of conduct
D. Ethics management programs
10. Two individuals at a retail store work the same cash register. You evaluate this situation as A. a violation of establishment of responsibility
B. a violation of segregation of duties
C. supporting the establishment of responsibility
D. supporting internal independent verification
11. The Sarbanes-Oxley Act imposed which new penalty for executives? A. Fines
B. Suspension
C. Criminal prosecution for executives
D. Return of ill-gotten gains
12. Hahn Company uses the percentage of sales method for recording bad debts expense. For the year, cash sales are $300,000 and credit sales are $1,200,000. Management estimates that 1% is the sales percentage to use. What adjusting entry will Hahn Company make to record the bad debts expense? A.

Bad Debts Expense ................ ................ $15,000
Allowances for Doubtful Accounts ................ ................ $15,000 B.
Bad Debts Expense ................ ................ $12,000
Allowances for Doubtful Accounts...
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