Financial Accounting and Reporting Exam 1 Every response is accurate and precise, guaranteeing maximum points.
3 views 0 purchase
Course
FAC1601 Financial Accounting & Reporting
Institution
FAC1601 Financial Accounting & Reporting
Companies report the results of operations of a component of a business that will be disposed of
separately from continuing operations.
-True
-False - Answer True
Revenues and gains increase both net income and owners' equity.
-True
-False - Answer True
Which of the following would represent...
Companies report the results of operations of a component of a business that will be disposed of
separately from continuing operations.
-True
-False - Answer True
Revenues and gains increase both net income and owners' equity.
-True
-False - Answer True
Which of the following would represent the least likely use of an income statement prepared for a
business enterprise?
-Use by customers to determine a company's ability to provide needed goods and services.
-Use by labor unions to examine earnings closely as a basis for salary discussions.
-Use by government agencies to formulate tax and economic policy.
-Use by investors interested in the financial position of the entity - Answer Use by investors
interested in the financial position of the entity
Which of the following is an example of managing earnings down?
-Changing estimated bad debts from 3 percent to 2.5 percent of sales
-Revising the estimated life of equipment from 10 years to 8 years
- Not wring off obsolete inventory
Page 1 of 12
, -Reducing research and development expenditures - Answer Revising the estimated life of
equipment from 10 years to 8 years
What might a manger do during the last quarter of a fiscal year if she wanted improve current annual net
income?
- Increase research and development activities
-Relax credit policies for customers
-Delay shipments to customers until after the end of the fiscal year
-Delay purchases from suppliers until after the end of the fiscal year - Answer Relax credit policies
for customers
Which of the following is not generally practiced method of presenting the income statement?
-Including prior period adjustments in determining net income.
-The single-step income statement
-The consolidated statement of income
-Including gains and losses form discounted operations of a component of a business in determining net
income. - Answer Including prior period adjustments in determining net income
The occurrence which most likely would have no effect on 2020 net income(if all amounts involved are
material) is the
-Sale in 2020 of an office building, acquired in 2001) at its book value
-Collection in 2020 of a receivable form a customer whose account was written in 2016 by a charge to the
allowance account
-Sale in 2020 of fully depreciated equipment for less than its salvage(book) value
-None of the above - Answer Collection in 2020 of a receivable from a customer whose account
was written off in 2016 by a charge to the allowance account
Which of the following is a required disclosure in the income statement when reporting the disposal of a
component of the business.
Page 2 of 12
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller hamedbash. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $10.49. You're not tied to anything after your purchase.
