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Accounting 2000 - Exam 2 questions with answers, Exams of Accounting

Louisiana State University (LSU) - EuniceAccounting

Accounting 2000 - Exam 2 questions with answers

Typology: Exams

2024/2025

Available from 07/05/2025

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Accounting |\2000 |\- |\Exam |\2 |\questions |\with |\
answers
Current |\Assets |\- |\CORRECT |\ANSWERS |\✔✔- |\cash
- |\accts |\receivable
- |\inventory
- |\prepaids
Internal |\Control |\System |\- |\CORRECT |\ANSWERS |\✔✔set |\of |\policies |\and
|\procedures |\established |\by |\company |\to |\provide |\reasonable |\
assurance |\that |\firm's |\objectives |\will |\be |\met
2 |\common |\internal |\controls |\over |\cash |\- |\CORRECT |\ANSWERS |\✔✔1. |\
segregation |\of |\duties
2. |\prepare |\bank |\reconciliations
Segregation |\of |\duties |\- |\CORRECT |\ANSWERS |\✔✔- |\authorization: |\
approving |\transactions |\& |\decisions
- |\recording: |\maintaining |\journals |\& |\ledgers
- |\custody: |\handling |\cash, |\maintaining |\an |\inventory |\storeroom, |\
receiving |\incoming |\customer |\checks, |\writing |\checks |\on |\an |\org's |\
bank |\acct
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Accounting |\ 2000 |- |\Exam |\ 2 |\questions |\with |\

answers

Current |\Assets |- |\CORRECT |\ANSWERS |\✔✔- |\cash

  • |\accts |\receivable
  • |\inventory
  • |\prepaids Internal |\Control |\System |- |\CORRECT |\ANSWERS |\✔✔set |\of |\policies |\and |\procedures |\established |\by |\company |\to |\provide |\reasonable |
    assurance |\that |\firm's |\objectives |\will |\be |\met 2 |\common |\internal |\controls |\over |\cash |- |\CORRECT |\ANSWERS |\✔✔1. |
    segregation |\of |\duties
  1. |\prepare |\bank |\reconciliations Segregation |\of |\duties |- |\CORRECT |\ANSWERS |\✔✔- |\authorization: |
    approving |\transactions |& |\decisions
  • |\recording: |\maintaining |\journals |& |\ledgers
  • |\custody: |\handling |\cash, |\maintaining |\an |\inventory |\storeroom, |
    receiving |\incoming |\customer |\checks, |\writing |\checks |\on |\an |\org's |
    bank |\acct

collusion |- |\CORRECT |\ANSWERS |\✔✔when |\ 2 |\or |\more |\people |\work |
together |\to |\commit |\fraud deposits |\in |\transit |- |\CORRECT |\ANSWERS |\✔✔deposits |\recorded |\by |
company |\but |\not |\bank outstanding |\checks |- |\CORRECT |\ANSWERS |\✔✔withdrawals |\recorded |
by |\company |\but |\not |\bank interest |\earned |- |\CORRECT |\ANSWERS |\✔✔deposits |\recorded |\by |\bank |
but |\not |\company bank |\service |\charge/NSF |\checks |- |\CORRECT |\ANSWERS |
✔✔withdrawals |\recorded |\by |\bank |\but |\not |\company 5 |\reasons |\bank |\balance |& |\gender |\ledger |\balance |\are |\not |\the |\same |- |\CORRECT |\ANSWERS |\✔✔1. |\deposits |\in |\transit

  1. |\outstanding |\checks
  2. |\interest |\earned
  3. |\bank |\service |\charge/NSF |\checks
  4. |\errors

What |\does |\it |\mean |\that |\a |\sales |\discount |\is |\a |\contra-revenue |
account? |- |\CORRECT |\ANSWERS |\✔✔- |\results |\in |\a |\DECREASE |\to |
REVENUES |\on |\the |\income |\statement |\and |\thus |\a |\DECREASE |\to |\NET |
INCOME Bad |\debt |\expense |- |\CORRECT |\ANSWERS |\✔✔- |\record |\in |\same |\year |\as |\sale |\occurs |(matching |\concept)

  • |\estimate
  • |\requires |\adjusting |\entry
  • |\expense |\account |\on |\income |\statement
  • |\reduces |\net |\income Balance |\Sheet |- |\CORRECT |\ANSWERS |\✔✔- |\Assets
  • |\Liabilities
  • |\Equity Income |\Statement |- |\CORRECT |\ANSWERS |\✔✔1. |\Revenues
  1. |\Expenses Longterm |\assets |- |\CORRECT |\ANSWERS |\✔✔- |\PPE |(Plant |\property |
    equipment)
  • |\Intangibles |(trademark, |\patent, |\copyright)

Historical |\Cost |\concept |- |\CORRECT |\ANSWERS |\✔✔Assets |\on |\balance |
sheet |\are |\shown |\at |\price |\they |\were |\purchased |\at Current |\liabilities |- |\CORRECT |\ANSWERS |\✔✔- |\accounts |\payable

  • |\short |\term |\notes |\payable
  • |\salaries |\payable
  • |\income |\taxes |\payable
  • |\utilities |\payable Long-term |\liabilities |- |\CORRECT |\ANSWERS |\✔✔- |\long |\term |\notes |
    payable
  • |\mortgage |\payable Equity |- |\CORRECT |\ANSWERS |\✔✔- |\capital |\stock |(contributed |\capital)
  • |\retained |\earnings Retained |\earnings |- |\CORRECT |\ANSWERS |\✔✔- |\net |\income |\kept |\in |
    company |\for |\expansion Revenues |- |\CORRECT |\ANSWERS |\✔✔- |\sales |\revenue
  • |\service |\revenue
  • |\rental |\revenue

Total |\equity |\equation |- |\CORRECT |\ANSWERS |\✔✔contributed |\capital |+ |
retained |\earnings |= |\total |\equity EPS |(earnings |\per |\share) |\ratio |- |\CORRECT |\ANSWERS |\✔✔Net |\income |/ |# |\shares |\outstanding |
higher |\is |\better ROE |(return |\on |\equity) |\ratio |- |\CORRECT |\ANSWERS |\✔✔Net |\income |/ |
avg. |\equity avg |\equity |= |\equity |\beginning |+ |\equity |\at |\end |/ |\ 2 higher |\is |\better ROI |(return |\on |\investment) |\ratio |- |\CORRECT |\ANSWERS |\✔✔margin |\X |
turnover margin: |\net |\income/sales turnover: |(sales/avg |\total |\assets) net |\income/avg |\total |\assets Working |\capital |- |\CORRECT |\ANSWERS |\✔✔current |\assets |- |\current |
liabilities

Current |\ratio |- |\CORRECT |\ANSWERS |\✔✔current |\assets |/ |\current |
liabilities Acid-test |\ratio |(Quick |\ratio) |- |\CORRECT |\ANSWERS |\✔✔(cash |+ |\acct |
receivable) |/ |\current |\liabilities Gain |- |\CORRECT |\ANSWERS |\✔✔recorded |\when |\you |\sell |\an |\asset |
OTHER |\than |\inventory |\for |\more |\than |\its |\cost |\to |\you |\or |\LESS |\if |\it |\is |
a |\loss selling |\price |- |\cost |= |\gain/loss Deferrals |- |\CORRECT |\ANSWERS |\✔✔transactions |\where |\cash |\is |\paid |
or |\received |\BEFORE |\action Accruals |- |\CORRECT |\ANSWERS |\✔✔transactions |\for |\which |\cash |\has |
NOT |\been |\received |\or |\paid |\but |\action |\HAS |\occurred Aging |\method |- |\CORRECT |\ANSWERS |\✔✔- |\used |\to |\calculate |\bad |\debt |\expense |\estimate

  • |\put |\account |\receivable |\in |\categories |\by |\age |\and |\assigns |\a |% |\to |\be |\uncollectible |\to |\each |\category
  • |\cost |\of |\MOST |\RECENT |\inventory |\items |\makeup |\cost |\of |\goods |\sold |
    on |\income |\statement
  • |\cost |\of |\OLDEST |\inventory |\items |\is |\on |\ending |\inventory Weighted |\average |- |\CORRECT |\ANSWERS |\✔✔- |\assumes |\all |\inventory |
    has |\same |\cost
  • |\same |\cost |\is |\weighted |\avg., |\cost |\per |\unit (cost |\of |\beg. |\inventory |+ |\cost |\of |\purchases) |/ |(units |\in |\beg. |
    inventory |+ |\units |\purchased)