This quiz works best with JavaScript enabled. Home > Finance > Accounting > Intermediate Accounting > Intermediate Accounting – Quiz 3 🏠 Homepage 📘 Download PDF Books 📕 Premium PDF Books Intermediate Accounting Quiz 3 (30 MCQs) Quiz Instructions Select an option to see the correct answer instantly. 1. All the following are early warning indicators of a problem loan, except A) Higher sales and higher Margins. B) Higher sales and Increased aging of account receivables. C) Higher sales and lower margins. D) Higher Sales and higher Sales returns. Show Answer Correct Answer: A) Higher sales and higher Margins. 2. The profession responsible for preparing accounting standards in Indonesia is A) Accountant. B) DSAK. C) IAI. D) IASB. Show Answer Correct Answer: A) Accountant. 3. Depending on which estimation approach better predicts the amount that the seller will recieve A) Most Likely Amount. B) Expected Value. Show Answer Correct Answer: A) Most Likely Amount. 4. Reported as a contra account to adjust the balance from the internal method to the Lifo method for external reporting A) Lifo liquidation. B) LIFO Reserves. Show Answer Correct Answer: B) LIFO Reserves. 5. Gross Profit / Net sales or (Net Sale-COGS)/ Net SalesHigher the ratio, higher the markup achieved A) Gross Profit Ratio. B) Inventory turnover ratio. Show Answer Correct Answer: A) Gross Profit Ratio. 6. It is a type of Partners wherein it is only liable to the extent of his contribution to business. A) Capitalist Partner. B) Limited Partner. C) Industrial Partner. D) General Partner. Show Answer Correct Answer: B) Limited Partner. 7. Which of the following is not a characteristic of the corporate form of organization? A) Separate legal existence. B) Unlimited liability for shareholders. C) Ability to obtain large amounts of capital easily. D) Easy transferability of ownership interests. Show Answer Correct Answer: B) Unlimited liability for shareholders. 8. Calculated as the sum of each possible amount multiplies by its probability A) Expected Value. B) Most Likely Amount. Show Answer Correct Answer: A) Expected Value. 9. -lack physical substance-patents, copyrights, trademarks, franchises, goodwill A) Natural resources. B) Initial cost. C) Intangible assets. D) None of above. Show Answer Correct Answer: C) Intangible assets. 10. Tilaar Corporation made credit sales of $ 20, 000 which are subject to 5% sales tax. The corporation also made cash sales which totaled $ 30, 770 including the 5% sales tax. What is the journal entry to record Tilaar's credit sales? A) Dr. Cash $ 29, 500Dr. Sales $ 1, 270Cr. Sales tax payable $ 30, 770. B) Dr. Cash $ 30, 770Cr. Sales $ 29, 500Cr. Sales tax payable $ 1, 270. C) Dr. Accounts receivable $ 20, 000Dr. Sales tax payable $ 1, 000Cr. Sales $ 21, 000. D) Dr. Accounts receivable $ 20, 000Cr. Sales $ 19, 000Cr. Sales tax payable $ 1, 000. E) Dr. Accounts receivable $ 21, 000Cr. Sales $ 20, 000Cr. Sales tax payable $ 1, 000. Show Answer Correct Answer: E) Dr. Accounts receivable $ 21, 000Cr. Sales $ 20, 000Cr. Sales tax payable $ 1, 000. 11. For an adjusting entry for deferred expenses, it is common to: A) Debit an expense and credit cash. B) Debit a liability and credit an asset. C) Debit an expense and credit a liability. D) Debit an expense and credit an asset. Show Answer Correct Answer: D) Debit an expense and credit an asset. 12. What is the enticement to do something that benefits the donor? A) Goodwill. B) Security. C) Donated Assets. D) None of above. Show Answer Correct Answer: C) Donated Assets. 13. The following are disadvantages of Corporation, except? A) Difficult to organize. B) Strictly regulated and supervised by the Government. C) Formal and Impersonal Employer-Employee Relationship. D) None of the choices. Show Answer Correct Answer: D) None of the choices. 14. Robert Corporation owns machinery that cost $ 30, 000 when purchased on July 1, 2015. Depreciation has been recorded at a rate of $ 2, 600 per year, resulting in a balance in accumulated depreciation of $ 9, 100 at December 2018. The machinery is sold on Oct 1, 2019, for $ 20, 500. What is the journal entry to update depreciation for 2019? A) Dr. Depreciation expense $ 1, 950Cr. Accumulated depreciation $ 1, 950. B) Dr. Depreciation expense $ 650Cr. Accumulated depreciation $ 650. C) Dr. Depreciation expense $ 2, 600Cr. Accumulated depreciation $ 2, 600. D) Dr. Accumulated depreciation $ 1, 950Cr. Depreciation expense $ 1, 950. E) Dr. Accumulated depreciation $ 650Cr. Depreciation expense $ 650. Show Answer Correct Answer: A) Dr. Depreciation expense $ 1, 950Cr. Accumulated depreciation $ 1, 950. 15. The amount shareholders put in the company is called: A) Paid in Capital. B) Retained Earnings. Show Answer Correct Answer: A) Paid in Capital. 16. The accounts that are in debt are: A) Rent Charges Paid Up Front. B) Rent Expense. C) Prepaid Rental Income. D) Rental Income. Show Answer Correct Answer: C) Prepaid Rental Income. 17. Which best describes Management's responsibility? A) An assessment of the company's internal control procedures. B) A detailed explanation of data contained in the financial statements. C) An opinion that the financials present fairly the financial position, results of operations, and cash flow in accordance to GAAP. D) All of the above. Show Answer Correct Answer: A) An assessment of the company's internal control procedures. 18. A sale should not be recognized as revenue by the seller at the time of sale if: A) Payment was made by check. B) The selling price is less than the normal selling price. C) The buyer has a right to return the product and the amount of future returns cannot be reasonably estimated. D) None of these. Show Answer Correct Answer: C) The buyer has a right to return the product and the amount of future returns cannot be reasonably estimated. 19. Good/service are not highly interrelated with other good/services in the contract A) Capable of being distinct. B) Separately Identifiable. Show Answer Correct Answer: B) Separately Identifiable. 20. If the bond interest payment dates are May 1 and November 1, and the bond is sold on June 1, the amount of cash received by the bond issuer will be A) Minus interest owed from June 1 to November 1. B) Plus interest owed from May 1 to June 1. C) Minus interest owed from May 1 to June 1. D) Plus interest owed from June 1 to November 1. Show Answer Correct Answer: B) Plus interest owed from May 1 to June 1. 21. Unearned income is recorded in the financial statements, i.e A) Cash flow statement. B) Income statement. C) Capital change report. D) Financial position report. Show Answer Correct Answer: D) Financial position report. 22. Which of the following is (are) the proper time period(s) to record the effects of a change in accounting estimate? A) Current period and prospectively. B) Current period and retrospectively. C) Retrospectively only. D) Current period only. Show Answer Correct Answer: A) Current period and prospectively. 23. Which of the following best describes retained earnings? A) Cash available for dividends. B) The amount initially invested in the business by stockholders. C) Cash available for expansion and growth. D) Income that has been reinvested in the business rather than distributed as dividends to stockholders. Show Answer Correct Answer: D) Income that has been reinvested in the business rather than distributed as dividends to stockholders. 24. The differences between GAAP (FASB) and IFRS (IASB) A) FASB has worked on relatively narrow products, such as the definition off materiality and a more general disclosure framework. B) IASB has moved forward with a more comprehensive overhaul of its conceptual framework. C) IASB has worked on relatively narrow products, such as the definition off materiality and a more general disclosure framework. D) FASB has moved forward with a more comprehensive overhaul of its conceptual framework. Show Answer Correct Answer: A) FASB has worked on relatively narrow products, such as the definition off materiality and a more general disclosure framework. 25. Primary focus of financial accounting is: A) Providing financial information to internal users. B) Make sure books balance. C) Make sure company follows rules. D) Providing financial information to external users. Show Answer Correct Answer: D) Providing financial information to external users. 26. Carry Industries donates land to the city of Los Angeles for a city park. The land cost $ 100, 000 and has a fair value of $ 130, 000. What is the journal entry in Carry Industries to record this donation? A) Dr. Contribution Expense $ 100, 000Cr. Land $ 100, 000. B) Dr. Contribution Expense $ 130, 000Cr. Land $ 100, 000Cr. Gain on Disposal of Land $ 30, 000. C) Dr. Contribution Expense $ 130, 000Cr. Land $ 130, 000. D) Dr. Contribution Expense $ 100, 000Dr. Gain on Disposal of Land $ 30, 000Cr. Land $ 130, 000. E) None of these. Show Answer Correct Answer: B) Dr. Contribution Expense $ 130, 000Cr. Land $ 100, 000Cr. Gain on Disposal of Land $ 30, 000. 27. The use of company financial statements for potential creditors is: A) To find out the amount of company capital. B) To find out the distribution of profits to shareholders. C) As a consideration when providing credit. D) As a consideration in investing capital. Show Answer Correct Answer: C) As a consideration when providing credit. 28. What are assets that are constructed for a company's own use as well as assets constructed as discrete projects for sale on lease? A) Interest Capitalization. B) Self Constructed Assets. C) Overhead Allocation. D) Qualifying Assets. Show Answer Correct Answer: D) Qualifying Assets. 29. Sales returns for perpetual inventory owner ship depends on A) Ownership of goods. B) Consignor. C) Consignee. D) Reduction of purchases. Show Answer Correct Answer: D) Reduction of purchases. 30. Repayment of bonds previously issued at a premium price is repaid by issuing new bonds between interest payment dates. So at the time of the reacquisition A) All costs related to the issuance of (old) bonds are amortized up to the reacquisition date. B) The premium must be amortized up to the reacquisition date. C) There is accrued interest from the date of the last interest payment until the date of reacquisition. D) All answers are correct. Show Answer Correct Answer: D) All answers are correct. ← PreviousNext →Related QuizzesAccounting QuizzesFinance QuizzesIntermediate Accounting Quiz 1Intermediate Accounting Quiz 2Intermediate 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