GB518 Unit3 Midterm Exam
Midterm exam covering business and finance topics.
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GB518 Unit3 Midterm Exam
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1. What would be the appropriate entry for the following transaction?
Bill Co. performed $5,200 in consulting services on account (Points : 2)
Credit to Cash, Debit to Accounts Receivable
Debit to Revenue, Debit to Cash
Debit to Accounts Receivable, Credit to Cash
Debit to Revenue, Credit to Cash
Debit to Accounts Receivable, Credit to Revenue
2. Technological advancement (Points : 2)
Has replaced accounting
Has not changed the work that accountants do
Has freed accounting professionals to concentrate more on the analysis and interpretation of
information
In accounting has replaced the need for decision makers
In accounting is only available to large corporations
3.Which of the following elements are found on the Balance Sheet? (Points : 2)
Service Revenue
Net Income
Operating Activities
Utilities Expense
Retained Earnings
4.Increases in retained earnings from a company's earnings activities are: (Points : 2)
Assets
Revenues
Liabilities
Stockholder's Equity
Expenses
5. An asset created by prepayment of an expense is: (Points : 2)
Recorded as a debit to an unearned revenue account
Recorded as a debit to a prepaid expense account
Recorded as a credit to an unearned revenue account
Recorded as a credit to a prepaid expense account
Not recorded in the accounting records until the earnings process is complete
6.Unearned revenues are: (Points : 2)
Revenues that have been earned and received in cash
Report this Question as Inappropriate
1. What would be the appropriate entry for the following transaction?
Bill Co. performed $5,200 in consulting services on account (Points : 2)
Credit to Cash, Debit to Accounts Receivable
Debit to Revenue, Debit to Cash
Debit to Accounts Receivable, Credit to Cash
Debit to Revenue, Credit to Cash
Debit to Accounts Receivable, Credit to Revenue
2. Technological advancement (Points : 2)
Has replaced accounting
Has not changed the work that accountants do
Has freed accounting professionals to concentrate more on the analysis and interpretation of
information
In accounting has replaced the need for decision makers
In accounting is only available to large corporations
3.Which of the following elements are found on the Balance Sheet? (Points : 2)
Service Revenue
Net Income
Operating Activities
Utilities Expense
Retained Earnings
4.Increases in retained earnings from a company's earnings activities are: (Points : 2)
Assets
Revenues
Liabilities
Stockholder's Equity
Expenses
5. An asset created by prepayment of an expense is: (Points : 2)
Recorded as a debit to an unearned revenue account
Recorded as a debit to a prepaid expense account
Recorded as a credit to an unearned revenue account
Recorded as a credit to a prepaid expense account
Not recorded in the accounting records until the earnings process is complete
6.Unearned revenues are: (Points : 2)
Revenues that have been earned and received in cash
Revenues that have been earned but not yet collected in cash
Liabilities created when a customer pays in advance for products or services before the revenue
is earned
Recorded as an asset in the accounting records
7.The debt ratio is used: (Points : 2)
To measure the amount of equity relative to the expenses
To reflect the risk associated with a company's debts
Only by banks when a business applies for a loan
To determine how much debt a firm should pay off
8.The principle that (1) requires revenue to be recognized at the time it is earned, (2) allows the
inflow of assets associated with revenue to be in a form other than cash and (3) measures the
amount of revenue as the cash plus the cash equivalent value of any non-cash assets received
from customers in exchange for goods or services is called the: (Points : 2)
Going-concern principle
Cost principle
Revenue recognition principle
Objectivity principle
Business entity principle
9.An example of an operating activity is: (Points : 2)
Paying wages
Purchasing office equipment
Borrowing money from a bank
Selling stock
Paying off a loan
10.Which of the following statements best describes the relationship of U.S. GAAP and IFRS?
(Points : 2)
They are identical
They are entirely different conceptual frameworks
They are similar but not identical
Neither has anything to do with accounting
They both relate only to publicly traded companies
11.The financial statement that shows: beginning and ending retained earnings balances and the
effects of net income (loss) and a dividend for the period is the: (Points : 2)
Statement of financial position
Statement of cash flows
Balance sheet
Liabilities created when a customer pays in advance for products or services before the revenue
is earned
Recorded as an asset in the accounting records
7.The debt ratio is used: (Points : 2)
To measure the amount of equity relative to the expenses
To reflect the risk associated with a company's debts
Only by banks when a business applies for a loan
To determine how much debt a firm should pay off
8.The principle that (1) requires revenue to be recognized at the time it is earned, (2) allows the
inflow of assets associated with revenue to be in a form other than cash and (3) measures the
amount of revenue as the cash plus the cash equivalent value of any non-cash assets received
from customers in exchange for goods or services is called the: (Points : 2)
Going-concern principle
Cost principle
Revenue recognition principle
Objectivity principle
Business entity principle
9.An example of an operating activity is: (Points : 2)
Paying wages
Purchasing office equipment
Borrowing money from a bank
Selling stock
Paying off a loan
10.Which of the following statements best describes the relationship of U.S. GAAP and IFRS?
(Points : 2)
They are identical
They are entirely different conceptual frameworks
They are similar but not identical
Neither has anything to do with accounting
They both relate only to publicly traded companies
11.The financial statement that shows: beginning and ending retained earnings balances and the
effects of net income (loss) and a dividend for the period is the: (Points : 2)
Statement of financial position
Statement of cash flows
Balance sheet
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Document Details
University
Purdue Global University
Subject
Business Management