This quiz works best with JavaScript enabled. Home > Accounting > Intermediate Accounting > Intermediate Accounting – Quiz 6 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Intermediate Accounting Quiz 6 (20 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which is not a criterion for measuring value? A) Original cost (Historical Cost). B) Current Cost. C) Settlement Value. D) Lowest value. Show Answer Correct Answer: D) Lowest value. 2. Government policy stating that companies are justified in changing their inventory valuation method to the LIFO method because devaluation is policy: A) Taxation. B) Stock Exchange. C) Banking. D) Government Accounting. Show Answer Correct Answer: A) Taxation. 3. Goods that are purchased primarily in finished form and retailersCosts include:Purchase Price plus any other cost necessary to get goods un condition and location for sale A) Merchandising Inventory. B) Manufacturing Inventory. Show Answer Correct Answer: A) Merchandising Inventory. 4. Which statement is most accurate regarding partnership accounting? A) Establishment of a partnership Partners must always record assets and liabilities at cost. B) Withdrawals for personal use will always increase your capital. C) Establishment of a partnership Partners must always record assets and liabilities at fair value. D) All correct. Show Answer Correct Answer: C) Establishment of a partnership Partners must always record assets and liabilities at fair value. 5. Lease term can be measured with the following, EXCEPT: A) Periods of time. B) Production units. C) None of the above. D) All of the above. Show Answer Correct Answer: C) None of the above. 6. Which are the assumptions in the PSAK conceptual framework? A) Substance over form. B) Accrual. C) Relevance. D) Economics Units. Show Answer Correct Answer: B) Accrual. 7. The right of shareholders to have the first opportunity to buy new shares issued by the company is called: A) Voting rights. B) Capital deposit rights. C) The right to pay attention to the proportion of share ownership. D) Profit sharing rights. Show Answer Correct Answer: C) The right to pay attention to the proportion of share ownership. 8. What does a returned check mean? A) A check that the business pays to another person and that person returns it to the business. B) A check that the business lost and then someone picked it up and returned it to me. C) Checks that the business paid to others and were returned by the bank because there was not enough money in the account to pay. D) Checks made by the business and recorded in the account. But the recipient has not yet cashed the money at the bank. Show Answer Correct Answer: C) Checks that the business paid to others and were returned by the bank because there was not enough money in the account to pay. 9. It is a systematic process of identifying, recording, measuring, classifying, verifying, summarizing, interpreting and communicating financial information. A) Financial Accounting. B) Financial Information. C) Accounting. D) None of the choices. Show Answer Correct Answer: C) Accounting. 10. Which of the following items is not counted as cash? A) Returned check. B) Deposit for air conditioner. C) Capital share certificate. D) All correct. Show Answer Correct Answer: D) All correct. 11. Number of issued shares held by shareholders of the company. Difference between issued ad outstanding arise when a corporation buys back its own shares of stock in the market, referred to as treasury stock A) Authorized Shares. B) Issued Shares. C) Outstanding Shares. D) None of above. Show Answer Correct Answer: C) Outstanding Shares. 12. Tanger Mining Corp. purchased the rights to a property in North America to mine for copper. The engineers estimate that a payment for the restoration of the property will need to be made at the end of the project, and that it has the following probable future outcomes:$ 200, 000 (40%), $ 400, 000 (60%). The present value of $ 1 factor for Tanger's 5 year project and risk-free interest rate of 3% is.86261. Which of the following will be the credit to the Asset Retirement Liability at the time of estimate? A) 320, 000. B) 276, 035. C) 517, 566. D) 370, 967. Show Answer Correct Answer: B) 276, 035. 13. Accrued interest on notes receivable is presented: A) On the balance sheet as debt. B) In profit and loss it goes to operating expenses. C) In profit and loss add to the cost of goods sold. D) On the balance sheet as an asset. Show Answer Correct Answer: D) On the balance sheet as an asset. 14. Rock Company had a balance Accounts Receivable of $ 180, 000, Allowance for Doubtful Accounts of $ 4, 000, Sales (all on credit) of $ 600, 000, and Sales return and allowances of $ 40, 000. What is the journal entry if Rock estimates bad debts at 2% of net sales? A) Dr. Bad debt expense $ 12, 000Cr. Allowance for doubtful accounts $ 12, 000. B) Dr. Bad debt expense $ 11, 200Cr. Allowance for doubtful accounts $ 11, 200. C) Dr. Bad debt expense $ 12, 800Cr. Allowance for doubtful accounts $ 12, 800. D) Dr. Allowance for doubtful accounts $ 11, 200Cr. Bad debt expense $ 11, 200. E) None of these. Show Answer Correct Answer: B) Dr. Bad debt expense $ 11, 200Cr. Allowance for doubtful accounts $ 11, 200. 15. Requires companies to report information about reported segment profit or loss, including certain revenues and expenses, segment assets, and the basis of measurement A) U.S. GAAP. B) IFRS. Show Answer Correct Answer: A) U.S. GAAP. 16. Lower of cost or market.Only used on LIFO or Inventory Market Value A) LCNRV. B) LCM. Show Answer Correct Answer: B) LCM. 17. Assumes units last acquired are sold first A) Specific Identification method. B) Average Cost. C) FIFO (First In, First Out). D) LIFO (Last in, First Out). Show Answer Correct Answer: D) LIFO (Last in, First Out). 18. "Gains" from the sale of treasury shares (using the cost method) should be credited to A) Share premium-treasury. B) Share capital. C) Retained earnings. D) Other income. Show Answer Correct Answer: A) Share premium-treasury. 19. If NRV is lower than cost A) Reduce inventory from its already recorded purchase cost to the lower NRV. B) No adjusting entry needed. Show Answer Correct Answer: A) Reduce inventory from its already recorded purchase cost to the lower NRV. 20. Which of the following is accounted for as a change in accounting principle? A) A change in the estimated useful life of plant assets. B) A change from the cash basis of accounting to the accrual basis of accounting. C) A change from expensing immaterial expenditures to deferring and amortizing them as they become material. D) A change in inventory valuation from average cost to FIFO. Show Answer Correct Answer: D) A change in inventory valuation from average cost to FIFO. ← PreviousNext →Related QuizzesAccounting QuizzesIntermediate Accounting Quiz 1Intermediate Accounting Quiz 2Intermediate Accounting Quiz 3Intermediate Accounting Quiz 4Intermediate Accounting Quiz 5Intermediate Accounting Quiz 7Intermediate Accounting Quiz 8Intermediate Accounting Quiz 9Intermediate Accounting Quiz 10 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books