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D102 Pre Assessment Exam Questions with Complete Solutions
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D102 Pre Assessment Exam Questions with Complete Solutions
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D102 Pre Assessment ExamQuestions with Complete Solutions
What information is contained in a balance sheet? - -Report of a company's
financial position as of a point in time.
-What is an owners' equity item? - -Capital stock
-A company ended July with assets of $150,000 and owner's equity of
$60,000.
What is the amount of liabilities at the end of July? - -$90,000
-What is reported in a multiple-step income statement that is not reported in
a single-step income statement? - -Gross profit
-How is gross profit computed? - -Sales minus cost of goods sold.
-The following are some accounts from a company's financial statements:
accounts receivable
cost of goods sold
cash
retained earnings
sales
inventory
income tax expense
accounts payable
Which set is a list of all of the items that are used in computing this
company's net income? - -Sales, cost of goods sold, and income tax
expense.
-What cash flow category contains activities whereby cash is obtained from
or repaid to owners or creditors? - -Financing
-Here are some financial statement items for the year for a company.
Cash received from customers
Cash received from the sale of land
Cash paid for dividends
Cash paid to employees for wages
Cash paid to purchase a new building
Cash paid for rent
Cash received as new investment from owners
Which set of items is a list of items that are used in computing the
company's financing cash flow for the year? - -Cash paid for dividends and
cash received as new investment from owners.
, -Here are some financial statement items for a company.
Net income
Cash flow from financing activities
Cash balance at the beginning of the year
Sales Cash flow from investing activities
Accounts receivable
Retained earnings at the beginning of the year
Cash flow from operating activities
What items are used in computing the company's ending cash balance for
the year? - -Cash balance at the beginning of the year, cash flow from
operating activities, cash flow from investing activities, and cash flow from
financing activities.
-How is revenue typically recorded with debits and credits? - -As a credit,
representing an increase in equity.
-What is the proper way to record an increase in an asset account and an
increase in an equity account? - -Asset, debit; equity, credit
-A company was started last year when the shareholders invested $70,000
cash into it. At that time, the company also borrowed $100,000 cash from a
local bank. The company used $140,000 cash to purchase inventory for
$140,000. This year the company sold all of the inventory for $95,000 cash
(and that is not a typographical error; the amount received for all of the
inventory was only $95,000 cash).
Which account balance is correct with respect to this company's balance
sheet after the sale of the inventory? - -Total owners' equity is $25,000.
-On January 1, a company had these assets, liabilities, and equities:
Cash $100
Inventory $140
Accounts payable $70
Paid-in capital $150
Retained earnings $20
During the year, the company entered into these transactions:
Selling inventory costing $140 for a total of $200; cash of $30 was received,
and the remaining $170 was put on account.
Paying cash for rent of $45.
Paying cash dividends of $30.
What is this company's total equity at the end of the year? - -$155
-A company made a $3,000 cash payment on a loan. Of the $3,000 cash
paid, $2,400 was for interest expense and $600 was a payment to reduce
the loan balance.
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