ACCT 284 IOWA STATE - Exam 2 with Questions and Answers
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Course
ACCT
Institution
ACCT
ACCT 284 IOWA STATE - Exam 2 with Questions and Answers
On October 31 of the current year, unearned service revenue of $4,800 was recognized representing one year of services to be performed over the following 12 months. The adjusting entry on December 31 will include a(n)
A) increase to unearn...
ACCT 284 IOWA STATE - Exam 2 with Questions and Answers
On October 31 of the current year, unearned service revenue of $4,800 was recognized representing one year of services to be performed over the following 12 months. The adjusting entry on December 31 will include a(n)
A) increase to unearned service revenue of $800.
B) decrease to unearned service revenue of $4,000.
C) increase to service revenue of $800
D) increase to service revenue of $4,000. ANSWER c
In reconciling the checking account, PureLife Company noted the following items for the month of October:
Ending bank balance $5,250
Deposits in transit $1,250
Outstanding checks $2,150
Ending book balance $4,500
NSF check $125
Bank service charges $25
What is the correct cash balance at the end of October?
A) $4,350
B) $4,425
C) $4,500
D) $4,725 ANSWER A
Auto Parts Inc. began the current month with inventory costing $40,000, then purchased inventory at a cost of $175,000. The perpetual inventory system indicates that inventory costing $120,000 was sold during the month for $160,000. If an inventory count shows that inventory costing $92,000 is actually on hand at month-end, what amount of shrinkage occurred during the month? A) $1,000.
B) $3,000.
C) $4,000.
D) $55,000. ANSWER B
When goods are sold to a customer with credit terms of 2/10, n/30, the customer will A) receive a 10% discount if they pay within 2 days. B) receive a 2% discount if they pay 10% of the amount due within 30 days. C) receive a 10% discount if they pay within 30 days. D) receive a 2% discount if they pay within 10 days. ANSWER D
Merchandise shipped FOB shipping point on the last day of the year should be included in A) the inventory balance of the seller.
B) the inventory balance of the buyer.
C) neither the inventory balance of the buyer or the seller.
D) both the inventory balance of the buyer and the seller. ANSWER B
Failure to make an adjusting entry to recognize rent revenue receivable would cause A) an understatement of assets, net income, and stockholders' equity. B) an overstatement of assets and stockholders' equity and an understatement of net income. C) no effect on assets, liabilities, net income, nor stockholders' equity. D) an overstatement of assets, net income, and stockholders' equity. ANSWER A
Which of the following is not a type of inventory held by a manufacturer?
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