ACCT 330 INTERMEDIATE ACCOUNTING I EXAM 1
- UNIVERSITY OF KANSAS SCHOOL OF BUSINESS -
(30 QUESTIONS) UP-TO-DATE ACTUAL EXAM
QUESTIONS AND 100% ACCURATE SOLUTIONS |
VERIFIED ANSWERS - INSTANT PDF DOWNLOAD
Examiner/Administrator: University of Kansas School of Business
Candidate Name: ____________________________
Candidate ID: ________________________________
Date: ______________________________________
Examination Location: _________________________
Instructions to Candidates:
You are required to complete all questions within the allocated time of 90
minutes. This assessment consists of approximately 30 multiple-choice
questions designed to evaluate your understanding of foundational concepts
in intermediate financial accounting, including recognition, measurement,
and reporting principles. Carefully read each question and select the most
appropriate answer. Calculators are permitted; however, no external
materials are allowed unless specified. Ensure that your responses are clearly
marked. Partial knowledge may not yield credit; accuracy and reasoning are
essential.
Core Competency Areas:
• Conceptual Framework and Financial Reporting
• Revenue Recognition Principles
• Time Value of Money Applications
• Cash and Receivables Accounting
• Inventory Valuation Methods
• Income Statement and Balance Sheet Presentation
,This simulated examination is designed to reflect the structure and rigor of an
Intermediate Accounting I exam. It is intended solely for educational and
preparatory purposes and does not represent actual examination content
administered by the University of Kansas.
This examination assesses your ability to apply accounting principles, analyze
financial scenarios, and interpret reporting standards. You are expected to
demonstrate critical thinking and precision in solving accounting problems
aligned with Generally Accepted Accounting Principles (GAAP). Mastery of
these competencies is essential for progressing in advanced accounting
coursework and professional practice.
Q1. A company recognizes revenue when control of goods transfers to the
customer. In a bill-and-hold arrangement, revenue can be recognized only if
which condition is met?
A. The customer has not yet paid for the goods
B. The goods are complete and ready for shipment, and the customer requests
delayed delivery
C. The seller retains physical possession indefinitely
D. The risks of ownership remain with the seller
Correct Answer: B. The goods are complete and ready for shipment,
and the customer requests delayed delivery
Explanation: Revenue recognition under bill-and-hold requires strict
criteria. The goods must be complete, ready for shipment, and the delay must be
at the customer's request. Option A is irrelevant. Option C violates transfer of
control. Option D contradicts revenue recognition principles since risks must
transfer to the buyer.
,Q2. A firm reports accounts receivable of $500,000 and estimates uncollectible
accounts at 4%. What is the adjusting entry under the allowance method?
A. Debit Bad Debt Expense $20,000
B. Debit Accounts Receivable $20,000
C. Credit Cash $20,000
D. Debit Allowance for Doubtful Accounts $20,000
Correct Answer: A. Debit Bad Debt Expense $20,000
Explanation: The allowance method estimates bad debts as 4% × $500,000
= $20,000. This requires a debit to Bad Debt Expense and a credit to Allowance
for Doubtful Accounts. Other options either misstate accounts or reverse
entries.
Q3. Which inventory costing method results in the highest net income during
periods of rising prices?
A. FIFO
B. LIFO
C. Weighted Average
D. Specific Identification
Correct Answer: A. FIFO
Explanation: FIFO assigns older, lower costs to COGS, resulting in higher
income. LIFO uses higher costs, reducing income. Weighted average smooths
effects, and specific identification depends on actual flow.
Q4. If a company uses LIFO and prices are falling, what happens to cost of
goods sold?
A. It decreases
, B. It increases
C. It remains unchanged
D. It becomes zero
Correct Answer: A. It decreases
Explanation: Under falling prices, newer inventory is cheaper. LIFO
assigns these lower costs to COGS, decreasing expense. Option B applies to
rising prices.
Q5. A company receives $12,000 in advance for services to be performed over
6 months. What is the monthly adjusting entry?
A. Debit Revenue $2,000
B. Credit Unearned Revenue $2,000
C. Debit Unearned Revenue $2,000
D. Credit Cash $2,000
Correct Answer: C. Debit Unearned Revenue $2,000
Explanation: Monthly revenue recognition requires reducing Unearned
Revenue and recognizing earned revenue. Option A is incorrect because
revenue is credited, not debited.
Q6. Which qualitative characteristic ensures financial information is free from
bias?
A. Relevance
B. Faithful representation
C. Comparability
D. Timeliness
Correct Answer: B. Faithful representation
- UNIVERSITY OF KANSAS SCHOOL OF BUSINESS -
(30 QUESTIONS) UP-TO-DATE ACTUAL EXAM
QUESTIONS AND 100% ACCURATE SOLUTIONS |
VERIFIED ANSWERS - INSTANT PDF DOWNLOAD
Examiner/Administrator: University of Kansas School of Business
Candidate Name: ____________________________
Candidate ID: ________________________________
Date: ______________________________________
Examination Location: _________________________
Instructions to Candidates:
You are required to complete all questions within the allocated time of 90
minutes. This assessment consists of approximately 30 multiple-choice
questions designed to evaluate your understanding of foundational concepts
in intermediate financial accounting, including recognition, measurement,
and reporting principles. Carefully read each question and select the most
appropriate answer. Calculators are permitted; however, no external
materials are allowed unless specified. Ensure that your responses are clearly
marked. Partial knowledge may not yield credit; accuracy and reasoning are
essential.
Core Competency Areas:
• Conceptual Framework and Financial Reporting
• Revenue Recognition Principles
• Time Value of Money Applications
• Cash and Receivables Accounting
• Inventory Valuation Methods
• Income Statement and Balance Sheet Presentation
,This simulated examination is designed to reflect the structure and rigor of an
Intermediate Accounting I exam. It is intended solely for educational and
preparatory purposes and does not represent actual examination content
administered by the University of Kansas.
This examination assesses your ability to apply accounting principles, analyze
financial scenarios, and interpret reporting standards. You are expected to
demonstrate critical thinking and precision in solving accounting problems
aligned with Generally Accepted Accounting Principles (GAAP). Mastery of
these competencies is essential for progressing in advanced accounting
coursework and professional practice.
Q1. A company recognizes revenue when control of goods transfers to the
customer. In a bill-and-hold arrangement, revenue can be recognized only if
which condition is met?
A. The customer has not yet paid for the goods
B. The goods are complete and ready for shipment, and the customer requests
delayed delivery
C. The seller retains physical possession indefinitely
D. The risks of ownership remain with the seller
Correct Answer: B. The goods are complete and ready for shipment,
and the customer requests delayed delivery
Explanation: Revenue recognition under bill-and-hold requires strict
criteria. The goods must be complete, ready for shipment, and the delay must be
at the customer's request. Option A is irrelevant. Option C violates transfer of
control. Option D contradicts revenue recognition principles since risks must
transfer to the buyer.
,Q2. A firm reports accounts receivable of $500,000 and estimates uncollectible
accounts at 4%. What is the adjusting entry under the allowance method?
A. Debit Bad Debt Expense $20,000
B. Debit Accounts Receivable $20,000
C. Credit Cash $20,000
D. Debit Allowance for Doubtful Accounts $20,000
Correct Answer: A. Debit Bad Debt Expense $20,000
Explanation: The allowance method estimates bad debts as 4% × $500,000
= $20,000. This requires a debit to Bad Debt Expense and a credit to Allowance
for Doubtful Accounts. Other options either misstate accounts or reverse
entries.
Q3. Which inventory costing method results in the highest net income during
periods of rising prices?
A. FIFO
B. LIFO
C. Weighted Average
D. Specific Identification
Correct Answer: A. FIFO
Explanation: FIFO assigns older, lower costs to COGS, resulting in higher
income. LIFO uses higher costs, reducing income. Weighted average smooths
effects, and specific identification depends on actual flow.
Q4. If a company uses LIFO and prices are falling, what happens to cost of
goods sold?
A. It decreases
, B. It increases
C. It remains unchanged
D. It becomes zero
Correct Answer: A. It decreases
Explanation: Under falling prices, newer inventory is cheaper. LIFO
assigns these lower costs to COGS, decreasing expense. Option B applies to
rising prices.
Q5. A company receives $12,000 in advance for services to be performed over
6 months. What is the monthly adjusting entry?
A. Debit Revenue $2,000
B. Credit Unearned Revenue $2,000
C. Debit Unearned Revenue $2,000
D. Credit Cash $2,000
Correct Answer: C. Debit Unearned Revenue $2,000
Explanation: Monthly revenue recognition requires reducing Unearned
Revenue and recognizing earned revenue. Option A is incorrect because
revenue is credited, not debited.
Q6. Which qualitative characteristic ensures financial information is free from
bias?
A. Relevance
B. Faithful representation
C. Comparability
D. Timeliness
Correct Answer: B. Faithful representation
