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1. Financing that individuals or institutions have provided to a company is A. always classified as liabilities. B. classified as liabilities when provided by creditors and shareholders' equity when provided by owners. C. always classified as shareholders' equity. D. classified as shareholders' equity when provided by creditors and liabilities when provided by owners. 2. Which of the following would affect shareholders' equity? A. A company borrows $100 million and buys $100 million ...

CHAPTER 3—ACCOUNTING FOR LABOR MULTIPLE CHOICE 1. At a plant where car doors were manufactured, all of the following would be classified as direct labor except: a. Machinists. b. Assembly workers. c. Maintenance personnel. d. Painters. ANS: C Maintenance workers, while integral to the manufacturing process as they keep the machinery maintained, are not direct laborers because they do not actually add value to the product. Machinists, assembly workers and painters would all add value...

GOVERNMENT ACCOUNTING 1. One of the following is not considered government income. (a) proceeds from loans and borrowings (b)government buildings (c) grants and aids received from foreign governments (d) taxes 2. What are the books of accounts in the government? (a) books of COA (b) books of COA and books of treasury (c) books of COA and books of agency (d)books of COA, books of treasury and books of agency 3. Which is incorrect concerning government accounting? (a) Laws, rules and r...

MASTERING CORRECTION OF ACCOUNTING ERRORS TESTBANK Section 1WHERE ERRORS OCCUR AND HOW THEY ARE FOUND 1. How frequently should the bank reconciliation be performed? a. Monthly b. Weekly c. Each time wages are paid to employees d. As frequently as is necessary to find errors 2. At year-end 20X2, you see that no insurance expense was recorded for 20X1. On July 1, 20X1, your company had prepaid a 2-year policy for $4,800, debiting Prepaid Insurance and crediting Cash. Correcting this er...

Conceptual Framework and Accounting Standards Q&A (4) 1. Which of the following statements is correct? a. A provision is recognized only when it represents a present obligation. b. An event or transaction whose outflow of economic benefits is probable and can be measured reliably is always recognized. c. A contingent asset that is possible is usually ignored. d. A contingent liability that is possible is ignored. 2. Intangible assets are measured as follows: Initial measurement Subsequen...

Question 1: Contribution Margin vs. Gross Margin FongFone Ltd. manufactures cell phones, which are priced at $250. Mr. Fong, the president of FongFone, has come to you for help in terms of the company’s cost structure. You are troubled because the data produced by the accounting system of FongFone do not distinguish between variable and fixed costs. After some analysis, you have identified various cost behaviour patterns. You have determined that the margin of safety is $75,000 and sales...

Chapter 12 Segment Reporting and Decentralization Multiple Choice Questions 16. If a cost is a common cost of the segments on a segmented income statement, the cost should: A) be allocated to the segments on the basis of segment sales. B) not be allocated to the segments. C) excluded from the income statement. D) treated as a product cost rather than as a period cost. Answer: B Level: Medium LO: 1 17. Spiedino Company sells its products to both residential and commercial customers in e...

Chapter 5 Cost Behavior: Analysis and Use 16. As the level of activity increases, how will a mixed cost in total and per unit behave? In Total Per Unit A) Increase Decrease B) Increase Increase C) Increase No effect D) Decrease Increase E) Decrease No effect Answer: A Level: Hard LO: 1 17. Since Anytime Pizza is open 24 hours a day, its pizza oven is constantly on and is, therefore, always using natural gas. However, when there is no pizza in the oven, the oven automatically lowers it...

Midterm - Practice Questions – Chapters 1, 2 & 8 SOLUTIONS 1 Explanation: “B” is correct because the fixed costs are always the same. As the more units are developed, these fixed costs can be spread over the units. If there are more units to spread the fixed costs, the fixed costs per unit will be lower. If you produce less units, the fixed costs per unit will be higher Ex. If fixed costs are always $100 if they produce 10 units, the fixed cost per unit will be $100/10 units = $10 p...

CHAPTER 1—INTRODUCTION TO COST ACCOUNTING MULTIPLE CHOICE 1. The business entity that converts purchased raw materials into finished goods by using labor, technology, and facilities is a: a. Manufacturer. b. Merchandiser. c. Service business. d. Not-for-profit service agency. ANS: A The business entity that converts purchased raw materials into finished goods by using labor, technology, and facilities is a manufacturer. PTS: 1 DIF: Easy REF: P. OBJ: Introduction NAT: IMA 4 - Busine...