This quiz works best with JavaScript enabled. Home > Finance > Accounting > Intermediate Accounting > Intermediate Accounting – Quiz 17 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Intermediate Accounting Quiz 17 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. Which characteristic is not possessed by intangible assets? A) Physical existence. B) Identifiable. C) Result in future benefits. D) Expensed over current and/or future years. Show Answer Correct Answer: A) Physical existence. 2. On Jul 5, David Company sold to Beckham Company merchandise having a sale price of $ 3, 000 with terms of 2/10, n/60, f.o.b. shipping point. What is the journal entry on David Company books to record sales using the net method if Beckham did not remit payment until August 30? A) Dr. Accounts receivable $ 3, 000Cr. Sales $ 3, 000. B) Dr. Cash $ 3, 000Cr. Accounts receivable $ 2, 940Cr. Sales discounts forfeited $ 60. C) Dr. Cash $ 2, 940Dr. Sales discounts $ 60Cr. Accounts receivable $ 3, 000. D) Dr. Cash $ 3, 000Cr. Accounts receivable $ 3, 000. E) Dr. Cash $ 2, 940Cr. Accounts receivable $ 2, 940. Show Answer Correct Answer: B) Dr. Cash $ 3, 000Cr. Accounts receivable $ 2, 940Cr. Sales discounts forfeited $ 60. 3. Changing estimate calculation in Depreciation A) Prospectively. B) Retrospectively. Show Answer Correct Answer: A) Prospectively. 4. Worst report from auditor (goes against GAAP) A) Qualified. B) Adverse or disclaimer. C) Unqualified with an explanation or emphasis paragraph. D) Unqualified. E) Rejected. Show Answer Correct Answer: B) Adverse or disclaimer. 5. Which of the following is the formula for Net Realizable Value? A) Estimated Cost of Good Sold, less costs of completion, divided by target number of units. B) Estimated Selling Price, less costs of completion, divided by target number of units. C) Estimated Selling Price, less costs of completion, transportation, and/or disposal cost. D) Estimated Cost of Good Sold, less costs of completion, transportation, and/or disposal. Show Answer Correct Answer: C) Estimated Selling Price, less costs of completion, transportation, and/or disposal cost. 6. If a company has high PE ratio, it is most likely because ..... A) The company is expected to grow very fast. B) The company's stock is overpriced. C) The company has very few shareholders. D) The company is very profitable. Show Answer Correct Answer: A) The company is expected to grow very fast. 7. Which is a debt security? A) Siam Commercial Bank debentures. B) Bangkok Bank common shares. C) Thai Bank common shares. D) All correct. Show Answer Correct Answer: A) Siam Commercial Bank debentures. 8. An inventory record card shows the following detailsfor the month of June:June 1:50 units in stock at a cost of P40 per unit 7:100 units purchased at a cost of P45 per unit 14:80 units sold21:50 units purchased at a cost of P50 per unit28:60 units sold What is the value of inventory at June 30 using theFIFO method? A) Sell, 000. B) Ba, 700. C) Ba, 450. D) Ba, 950. Show Answer Correct Answer: D) Ba, 950. 9. Which of the following intangible assets should not be amortized? A) Copyrights. B) Customers lists. C) Perpetual franchises. D) All of these intangible assets should be amortized. Show Answer Correct Answer: C) Perpetual franchises. 10. Buying/paying Company A) Investors. B) Creditors. Show Answer Correct Answer: A) Investors. 11. Emphasize principles for recognizing revenues and expenses, with some assets and liabilities recognized as necessary to make the balance sheet reconcile with the income statement A) Revenue/Expense Approach. B) Asset/Liability Approach. Show Answer Correct Answer: A) Revenue/Expense Approach. 12. Current GAAP standard setting committee. Made up of professional CPAs around US A) SEC. B) GAAP. C) GASB. D) IASB. E) FASB. Show Answer Correct Answer: E) FASB. 13. When reconciling a bank statement and cash book, which two of the following will require a transaction journal in the cash book?(1) Deposits credited after the date(2) Direct debits only to bank accounts(3) Bank charges(4) Bank error A) 1 dandy. B) Invite. C) A, 3 Dan 4. D) 1, a, don't. Show Answer Correct Answer: B) Invite. 14. Current Liabilities are A) Current liabilities. B) Non-current liabilities. C) Long term debt. D) All correct. Show Answer Correct Answer: A) Current liabilities. 15. In January 2020, an entity purchased a mineral minefor P3, 400, 000 with removable ore estimated bygeological surveys at 2, 000, 000 tons. The propertyhas an estimated value of P200, 000 after the ore hasbeen extracted. The company incurred P1, 000, 000 ofdevelopment costs preparing the mine for production.During 2020, 500, 000 tons were removed and400, 000 tons were sold. What is the amount of depletion that the entity should expense for 2020? A) P 840, 000. B) Phth00, 000. C) P640, 000. D) P1, 050, 000. Show Answer Correct Answer: A) P 840, 000. 16. Financial statements present the financial position on a certain date and fulfill the basic accounting assumptions, namely: A) Periodicity. B) Monetary unit. C) Going concern. D) Economic entity. Show Answer Correct Answer: A) Periodicity. 17. Publicly trades companies must use what in accordance to GAAP? A) Cash Basis. B) Accrual Basis. Show Answer Correct Answer: B) Accrual Basis. 18. The entity classifies a lease that meets the criteria as a finance lease. The lessee will depreciate the asset over the lease term. What qualitative characteristics underlie the accounting treatment? An entity classifies a lease that meets the criteria as a finance lease. The lessee will depreciate the asset throughout the lease term. What qualitative characteristics underlie this accounting treatment? A) Reliability. B) Going concern. C) Relevance. D) Substance over form. Show Answer Correct Answer: D) Substance over form. 19. Debit journal entries for an account are for: A) Increase liabilities. B) Increase assets. C) Increase equity. D) Answers A and C are correct. Show Answer Correct Answer: B) Increase assets. 20. Land held for sale in the SOFP falls into the category..... A) Non Current Assets. B) Current Liabilities. C) Current Assets. D) Equity. Show Answer Correct Answer: A) Non Current Assets. 21. If there is a cash purchase, it will be recorded in the journal..... A) Cash disbursement journal. B) Purchase returns journal. C) Purchase journal. D) Cash receipts journal. Show Answer Correct Answer: A) Cash disbursement journal. 22. Price if the product or services were sold in the market A) Adjusted market assessment approach. B) Expected cost plus margin approach. C) Residual Approach. D) None of above. Show Answer Correct Answer: A) Adjusted market assessment approach. 23. Cash is needed to meet payments arising from company activities. This motif is called..... A) Transaction motive. B) Compensation motive. C) Motif investasi. D) Speculative motive. E) Precautionary motive. Show Answer Correct Answer: A) Transaction motive. 24. Retail inventory method is used by A) Low volume retailers selling many different items at low unit prices. B) Low volume retailers selling many different items at high unit prices. C) High volume retailers selling many different items at high unit prices. D) High volume retailers selling many different items at low unit prices. Show Answer Correct Answer: D) High volume retailers selling many different items at low unit prices. 25. Expected residual value of an intangible asset usually is zero A) Residual Value. B) Useful Life. Show Answer Correct Answer: A) Residual Value. 26. The deposit method of revenue recognition is used when: A) The product can be marketed at quoted prices and units are interchangeable. B) Cash is received before the sales transaction is complete. C) The contract is short-term or the percentage-of-completion method can't be used. D) There are no significant costs of distribution. Show Answer Correct Answer: B) Cash is received before the sales transaction is complete. 27. Shareholders are limited to the dividends provided under stock preference and are not eligible to share in excess dividends A) Participating PS. B) Nonparticipating PS. C) Noncumulative PS. D) Cumulative PS. Show Answer Correct Answer: B) Nonparticipating PS. 28. Set of rules and guidance for accounts to properly/correctly record transactions in the accounting system A) SEC. B) GAAP. C) GASB. D) FASB. E) IASB. Show Answer Correct Answer: B) GAAP. 29. What is the collection of depreciable assets that share similar service lives and other attributes? A) Composite Depreciation Method. B) Group Depreciation Method. Show Answer Correct Answer: B) Group Depreciation Method. 30. Information is said to be material if..... A) Reducing Profit. B) Making the company lose money. C) The value is large, more than 5% of assets. D) Influence decisions that have been made based on financial information reports. Show Answer Correct Answer: D) Influence decisions that have been made based on financial information reports. ← PreviousNext →Related QuizzesAccounting QuizzesFinance QuizzesIntermediate Accounting Quiz 1Intermediate Accounting Quiz 2Intermediate Accounting Quiz 3Intermediate Accounting Quiz 4Intermediate Accounting Quiz 5Intermediate Accounting Quiz 6Intermediate Accounting Quiz 7Intermediate Accounting Quiz 8 🏠 Back to Homepage 📘 Download PDF Books 📕 Premium PDF Books