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Intermediate Accounting Quiz 2 (30 MCQs)

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1. Debit ..... if write-down is common for the particular company
2. In financing activities, the primary sources of financing for most business are owner and ..... ?
3. Which is a type of current liability where the time and amount of payment cannot be determined with certainty?
4. A company purchased a machine on 31 August 20X0 for CU22, 000. The machine is estimated to have a useful life of 7 years and an estimated residual value of IDR 1, 000. On June 30 2014, the machine was sold for IDR 9, 000. The end of the company's financial year is December 31. The company's accounting policy charges depreciation on a monthly basis using the straight-line method. What is the loss on disposal of machinery in the profit or loss statement for the financial year ended 31 December 20X4?
5. Layla Company issued a 3-year, P 150, 000 face value non interest-bearing note payable in exchange for a new machinery on January 1 (Year 1). The note is payable in 3 equal annual installments every January 1, starting year 1. No cash price of the machinery is available. The prevailing rate for similar note is 12%. PV of 1 at 12% for 3 periods is 0.7118. PV of an ordinary annuity of 1 at 12% periods us 2.4018. PV of an annuity due at 12% for 3 period us 2.6900. How much is the interest expense for Year 1?
6. Resources controlled by a company as a result of past events and from which the company's economic benefits are expected to be derived in the future are the definition of.....
7. Namwan and Namkhing established the Khingwan Partnership and agreed to share profits in the ratio of 6:4. Net profit for the current year is 500, 000 baht. How much share does each partner receive?
8. Dion Corporation made credit sales of $ 40, 000 which are subject to 5% sales tax. The corporation also made cash sales which totaled $ 30, 555 including the 5% sales tax. What is the journal entry to record Dion's cash?
9. The lease payments shall be accounted using what rate?
10. International Accounting standard setting bodies are
11. Loan acceleration is to give a loan to the borrower quickly.
12. Involves cash inflows and outflows from transactions with creditors and owners
13. Income Taxes and Net Income purposes. Provides higher cost of goods sold and therefore, lower net income than the other methods
14. The entity depreciates the fixed assets with an estimated useful life of 10 years, so that the depreciation expense will be recognized for 10 years of use of the assets. What are the basic assumptions underlying these accounting policies? (Entities depreciate fixed assets owned with an estimated useful life of 10 years, so that depreciation expense will be recognized over 10 years of use of the assets. What basic assumptions underlie these accounting policies?)
15. Dividends paid/distributed in the form of shares themselves are called.....
16. On December 31, Year 1, Zilong Company had an overdue 10% note payable to Aldous Bank worth 8 million and an accrued interest of P 800, 000. On that date, Aldous Bank offered modification of terms of the liability as follows:> Principal is reduced by P 2 million and accrued interest is condoned> Maturity is extended to December 31, Year 5> The new interest rate of 12% is payable every December 31> PV of 1 at 10% for 4 periods is 0.683 and PV of 1 at 12% for 4 periods is 0.636> PV of an ordinary annuity of 1 at 10% for 4 period is 3.17 and PV of an ordinary annuity of 1 at 12% for 4 period is 3.037How much is the PV of the new note payable at Year 1?
17. How can property, plant, and equipment be acquired?
18. Accumulated Other Comprehensive Income in SOFP will fall into the category.....
19. Recognizes and measure the assets and liabilities that exist at a balance sheet date.
20. The purchase transportation costs borne by the buyer are called.....
21. Short term Investments occur when
22. The accounting profession requires a conceptual framework to....., except:
23. Lower of cost or net realizable value.Used for companies that use FIFO, Average Cost, or any other method besides LIFO or the retail inventory method
24. Refers to the assets of a company
25. Ifa company must pay the shipping costs on inventory it purchased, what will be included in the journal entry to pay the freight company?
26. Which of the following is not a shareholder right?
27. Which of the following costs can be recognized in fixed assets?
28. Spencer Co. incurs $ 220, 000 in legal costs on January 1, 2015, to successfully defend a patent. The patent's useful life is 20 years, amortized on a straight-line basis. What is the journal entry to record the amortization at the end of 2015?
29. What does deposit in transit mean?
30. Company X currently has book value per share of THB 20 and cost of equity of 12%. If its ROE is 15% and dividend payout ratio is 80%, its share value is closest to:
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