Exam (elaborations) Liberty University ACCT 370 Quiz 1 Power answer

Liberty University ACCT 370 Quiz 1 Power answer Liberty University ACCT 370 Quiz 1 Power answer A+ Guarantee: When adjusting accrual earnings to obtain cash flows from operations, an increase in Prepaid Rent Expense is subtracted to arrive at cash flow from operations. The Barden Company provides the following trial balance as of December 31, 20X1. Debit Credit Cash and cash equivalents $345,000 Accounts receivable 115,000 Inventory 120,000 Prepaid insurance 7,500 Prepaid rent 40,000 Equipment 265,000 Accumulated depreciation – Equipment 65,000 Accounts payable 45,000 Accrued liabilities 10,000 Notes payable, due in 2020 135,000 Common stock 300,000 Additional paid-in capital 87,500 Retained earnings 250,000 Total $892,500 $892,500 What would Barden report as total stockholders’ equity on its balance sheet? Which of the following statements is not true regarding the cash flow statement? Which of the following statements is not true? The U.K. Equity account "Hedging reserve" is reported on a U.S. GAAP balance sheet as The balance sheet provides information on all of the following except: Balance sheet amounts would not be measured as: Which of the following statements is not true regarding the adoption of ASC Topic 606 guidance for revenue recognition? Liberty University ACCT 370 Quiz 1 Power answer In accounting for revenue recognition under ASC Topic 606, when there is a modification of a contract, which of the following is correct? Under ASC Topic 606 for revenue recognition, which of the following factors is not an indicator of the principal/agent determination? Under ASC Topic 606 for revenue recognition, which of the following statements is not accurate regarding performance obligations? Payments to a customer for slotting fees: Hargren Publishing offers its Accounting textbooks as e-texts through its online homework management system. Purchase of an access code provides the student with access to the e-text and online learning materials for six months. During that time, students have access to updates to the text and learning materials. Hargren should recognize revenue for purchases of access codes: Under the ASC Topic 606, which of the following statements is not a criteria that may determine whether revenue may be recognized over time? Which of the following statements is not true regarding the software developer example provided in ASC Topic 606 guidance for revenue recognition? Under ASC Topic 606 for revenue recognition, a performance obligation is considered satisfied when control over the goods and services is transferred to the customer. Which of the following is not an indicator that control has transferred? Which of the following statements is true regarding the new ASC Topic 606 for revenue recognition? To get revenue and expense account balances to zero requires a/an: Which of the following statements is correct regarding revenue and expense accounts? A debit does which of the following? Other Comprehensive Income (OCI) is used both in U.S. GAAP and IFRS. Which of the following statements is correct? When actuarial estimates related to defined benefit pension plans are adjusted: When analysts provide basic EPS for income from continuing operations that exclude the effects of special (i.e., nonrecurring) gains or losses and certain other non-cash charges, such earnings are frequently referred to as: Black & Decker decides to discontinue producing toasters in lieu of more versatile toaster ovens. In the process of discontinuing this line, the company disposes of the old production equipment and buys new equipment. The disposal of the old equipment would be reported in the income statement as: A component of an entity may be a/an: When reporting unusual or infrequent items in the income statement which of the following is not correct? The statement, "linkage between these costs and individual sales is difficult to establish," refers to The matching principle requires that expenses be recognized: The Canon Corporation sells ten copiers to the Title Company on October 15 for $40,000. Canon delivers the copiers to Title on October 20 and Title pays $16,000, agreeing to pay the balance on November 10. Under the accrual basis, how much revenue should Canon recognize in November? Which of the following is not correct with respect to accrual accounting? Which of the following does not describe how FASB endeavors to draft pronouncements? Which of the following is not an accurate statement related to the demand for financial reporting? When a company changes from straight-line to the declining balance method of accounting for depreciation, the financial statements lack: Which of the following create a competitive disadvantage according to the full disclosure principle? When financial statements are used by shareholders and investors to evaluate the performance of a company’s top executives it is referred to as the _____________ function of financial reports. Business enterprises enter into many different types of contracts. Examples of such contracts that often contain language that refers to verifiable financial statement numbers include all of the following except: Which of the following may cause fully diluted EPS to differ from basic EPS? Muenster Company sells its network servers with a warranty than includes preventive maintenance. Muenster should account for the warranty as a(n): Losses must be accrued if they are: 1. A 3-for-1 stock split will reduce the per share par value and will 2. accounting errors or irregularities can occur for what reason? 3. Accrual accounting net income can differ from operating cash flows for all of the following reasons except: A) future pension and healthcare benefits. B) estimates of uncollectible accounts. C) useful lives of assets. D) dividend declaration and payment dates. 4. Assuming the requirements for recognizing revenue over time are met, and using the percentage-of-completion method to recognize revenue, the measure of completion is computed by dividing: 5. A balance sheet prepared in accordance with U.S. GAAP typically: 6. The balance sheet provides information on all of the following except: A) where the money came from. B) assessing rates of return. C) how management invested its money. D) the market price of the company’s stock. 7. Balance sheets prepared under IFRS: 8. Being verifiable and neutral is part of what makes financial information 9. The best measure of a firm’s sustainable income is 10. Cash collected from customers can be derived: 11. The cash flow from operating activities: 12. The cash flow statement of the company is in process for 2019. They are reporting the following balances: 12/31/18 12/31/19 Equipment $ 100,000 $ 170,000 Loss on sale of equipment 0 10,000 Accumulated dep.—equipment 75,000 95,000 During 2019, they sold equipment costing $30,000 for $12,000 and made several purchases of new equipment for cash. Equipment purchases in 2019 were: 13. The cash flow statement of the company is in process for 2019. They are reporting the following balances: 12/31/18 12/31/19 Equipment $ 100,000 $ 170,000 Loss on sale of equipment 0 10,000 Accumulated dep.—equipment 75,000 95,000 During 2019, they sold equipment costing $30,000 for $12,000 and made several purchases of new equipment for cash. If these were the only investing activities, the cash flow from investing activities is a net cash: 14. Changes in the balance sheet accounts at June 30, 2018 and 2019 for the Company are presented below: Assets Cash $ 480,000 Accounts receivable 200,000 Inventory 300,000 Long-term investments 200,000 Equipment (200,000 ) Accumulated depreciation (60,000 ) Liabilities and Stockholders’ Equity Accounts payable $ (40,000 ) Dividends payable 400,000 Notes payable—Current (200,000 ) Notes payable—Long-term 400,000 Common stock, $1.00 par 300,000 Additional paid-in capital 100,000 Retained earnings 80,000 Additional Information for 2019: -Net income was $480,000 and dividends of $400,000 were declared. -Common stock was issued for cash. -A new long-term investment was acquired for $360,000. -A long-term investment was sold for $160,000. -Equipment that cost $600,000 was sold for $200,000. -The book value of those assets was $150,000. The cash flow from financing activities for 2019 is a: 15. Changes in the balance sheet accounts at June 30, 2018 and 2019 for the Company are presented below: Assets Cash $ 480,000 Accounts receivable 200,000 Inventory 300,000 Long-term investments 200,000 Equipment (200,000 ) Accumulated depreciation (60,000 ) Liabilities and Stockholders’ Equity Accounts payable $ (40,000 ) Dividends payable 400,000 Notes payable—Current (200,000 ) Notes payable—Long-term 400,000 Common stock, $1.00 par 300,000 Additional paid-in capital 100,000 Retained earnings 80,000 Additional Information for 2019: -Net income was $480,000 and dividends of $400,000 were declared. -Common stock was issued for cash. -A new long-term investment was acquired for $360,000. -A long-term investment was sold for $160,000. -Equipment that cost $600,000 was sold for $200,000. -The book value of those assets was $150,000. The gain on the sale of equipment for 2019 is: 16. Changes in the balance sheet accounts at June 30, 2018 and 2019 for the Company are presented below: Assets Cash $ 480,000 Accounts receivable 200,000 Inventory 300,000 Long-term investments 200,000 Equipment (200,000 ) Accumulated depreciation (60,000 ) Liabilities and Stockholders’ Equity Accounts payable $ (40,000 ) Dividends payable 400,000 Notes payable—Current (200,000 ) Notes payable—Long-term 400,000 Common stock, $1.00 par 300,000 Additional paid-in capital 100,000 Retained earnings 80,000 Additional Information for 2019: -Net income was $480,000 and dividends of $400,000 were declared. -Common stock was issued for cash. -A new long-term investment was acquired for $360,000. -A long-term investment was sold for $160,000. -Equipment that cost $600,000 was sold for $200,000. -The book value of those assets was $150,000. The purchase of equipment during 2019 is: 17. Companies that have projected operating cash flow that are more than sufficient to meet debt payments are: 18. Companies with a history of net operating losses are prone to issue which one of the following to raise money? 19. A company decides to discontinue producing toasters in lieu of more versatile toaster ovens. In the process of discontinuing this line, the company disposes of the old production equipment and buys new equipment. The disposal of the old equipment would be reported in the income statement as: