This quiz works best with JavaScript enabled. Home > Accounting > Intermediate Accounting > Intermediate Accounting – Quiz 22 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Intermediate Accounting Quiz 22 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. A shift of approach to strengthen in the field of accounting. Work hard to achieve the highest quality of reporting possible. A) Principles-based (Objective oriented). B) Rules Based. Show Answer Correct Answer: A) Principles-based (Objective oriented). 2. Dividend payment in the form of return of capital What type of business does it often occur? A) Hotel and resort business. B) Private schools and universities. C) Natural resource concession business. D) Retail businesses such as Tesco Lotus. E) Banking and financial institution business. Show Answer Correct Answer: C) Natural resource concession business. 3. Original transaction value adjusted for depreciation and amortization A) Historical Cost. B) Net realizable value. C) Current cost. D) Present value. E) Fair value. Show Answer Correct Answer: A) Historical Cost. 4. Cash will always get affected by an adjusted entry process A) True. B) False. Show Answer Correct Answer: B) False. 5. The activity of discontinuing a company's product line is called..... A) Stop Operation. B) Continuing Operation. C) Discontinued Operation. D) Other Comprehensive Income. Show Answer Correct Answer: C) Discontinued Operation. 6. The concept that forms the basis of the basic framework for presenting and disclosing financial statements is.....The concept that forms the basis of the basic framework for presenting and disclosing financial statements is..... A) Usefulness in decision making (decision usefulness). B) Ease of information to understand (understandability). C) Information reliability (reliability). D) Comparability of information (comparability). Show Answer Correct Answer: A) Usefulness in decision making (decision usefulness). 7. On June 2, Tom Company sold to Jerry Company merchandise having a sale price $ 5, 000 with terms of 2/10, n/60, f.o.b. shipping point. On June 11, the company received a check for the balance do from Jerry Company. Assuming Tom records sales using the net method. What is the journal entries on Tom Company books to record the sale? A) Dr. Cash $ 4, 900Dr. Sales discounts $ 100Cr. Accounts receivable $ 5, 000. B) Dr. Accounts receivable $ 5, 000Cr. Sales $ 5, 000. C) Dr. Cash $ 4, 900Cr. Accounts receivable $ 4, 900. D) Dr. Cash $ 5, 000Cr. Accounts receivable $ 5, 000. E) Dr. Cash $ 3, 920Cr. Accounts receivable $ 3, 920. Show Answer Correct Answer: C) Dr. Cash $ 4, 900Cr. Accounts receivable $ 4, 900. 8. When a plant asset is acquired by issuance of common stock, the cost of the plant asset is properly measured by the A) Par value of the stock. B) Stated value of the stock. C) Book value of the stock. D) Fair value of the stock. Show Answer Correct Answer: D) Fair value of the stock. 9. On January 1, Santibanez Inc. issued $ 3, 000, 000, 11% nominal interest, raising cash $ 3, 195, 000 (10% effective interest). Interest is payable annually on December 31. Santibanez uses the effective-interest method for premium/discount amortization. At the end of the first year, what is the value of the bonds reported in the financial statements? A) $ 3, 185, 130. B) $ 3, 184, 500. C) $ 3, 173, 550. D) $ 3, 165, 000. Show Answer Correct Answer: B) $ 3, 184, 500. 10. A company days sales outstanding are as follows for 2017, 2018, 2019:40 days, 35 days, 32 days. The Company is healthy A) True. B) False. Show Answer Correct Answer: A) True. 11. The party who needs accounting information to make a decision about whether or not to invest capital in the company is...... A) Creditors. B) Investor. C) Government. D) Employee. Show Answer Correct Answer: B) Investor. 12. Represents obligations created when expenses have been incurred but will not be paid until a subsequent reporting period A) Deferred Revenue. B) Accrued Liabilities. Show Answer Correct Answer: B) Accrued Liabilities. 13. Obtain source documents about external transactions, analyze the transaction, record the transaction in a journal, post from the journal to the general ledger accounts A) During the Accounting Period. B) At the end of the Accounting Period. C) At the end of the year. D) None of above. Show Answer Correct Answer: A) During the Accounting Period. 14. Periodicity A) Business is separate from owners. Economic events identified specifically with an . B) Assumption anticipates that a business entity will continue to operate indefinitely. C) Assumption allows the life of a company to be divided into artificial time periods to provide timely information. D) Transaction and reports stated in dollars. Show Answer Correct Answer: C) Assumption allows the life of a company to be divided into artificial time periods to provide timely information. 15. Which of the following is not treated as a change in accounting principle? A) A change from LIFO to FIFO for inventory valuation. B) A change to a different method of depreciation for plant assets. C) A change from full-cost to successful efforts in the extractive industry. D) A change from completed-contract to percentage-of-completion. Show Answer Correct Answer: B) A change to a different method of depreciation for plant assets. 16. Globally recognized accounting standards are A) IASB. B) IAI. C) IFRS. D) DSAK. Show Answer Correct Answer: C) IFRS. 17. The main objectives of making financial reports include: A) Seeking Profit. B) Maximizing Revenue. C) Provides information for users. D) Ease of Taxation. Show Answer Correct Answer: C) Provides information for users. 18. Earnings per share means A) Net profit or net loss per share of the company's capital. B) Net profit or net loss per common share of the company. C) Net profit or net loss per preferred share of the company. D) Net profit or net loss to total shareholders' equity. E) Net profit or net loss per bond of the company. Show Answer Correct Answer: B) Net profit or net loss per common share of the company. 19. Governmental agencies that regulate public companies. Congress gave ..... the power to regulate GAAP and select delegates for the FASB A) GAAP. B) FASB. C) SEC. D) IASB. E) GASB. Show Answer Correct Answer: C) SEC. 20. Residual rights to company assets after deducting liabilities are called A) Asset. B) Equity. C) Liabilities. D) Expense. Show Answer Correct Answer: B) Equity. ← PreviousNext →Related QuizzesAccounting QuizzesIntermediate Accounting Quiz 1Intermediate Accounting Quiz 2Intermediate Accounting Quiz 3Intermediate Accounting Quiz 4Intermediate Accounting Quiz 5Intermediate Accounting Quiz 6Intermediate Accounting Quiz 7Intermediate Accounting Quiz 8Intermediate Accounting Quiz 9 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books