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Acc 7

$12.99

Description

1. GAAP related to the disclosure of accounting policies: Select the correct answer. a. requires a description of every accounting policy followed by a reporting entity b. provides a specific listing of all types of accounting policies that must be disclosed c. requires disclosure of the format for the statement of cash flows d. requires a description of all significant accounting policies to be included as an integral part of the financial statements 2. Which of the following contingencies should generally be accrued on the balance sheet when the occurrence of the contingent event is reasonably possible and its amount can be reasonably estimated? Select the correct answer. a. Gain Contingency Loss Contingency Yes Yes b. Gain Contingency Loss Contingency Yes No c. Gain Contingency Loss Contingency No Yes d. Gain Contingency Loss Contingency No No 3. A donated fixed asset (from a governmental unit) for which the fair value has been determined should be recorded as a debit to fixed assets and a credit to Select the correct answer. a. unrealized capital b. retained earnings c. deferred income d. other income 4. On October 2, 2008, a company borrowed cash and signed a 3-year interest-bearing note on which both the principal and interest are payable on October 2, 2011. At December 31, 2010 the accrued interest should Select the correct answer. a. be reported on the balance sheet as a current liability b. be reported on the balance sheet as a noncurrent liability c. be reported on the balance sheet as part of long-term notes payable d. not be reported on the balance sheet as a liability 5. Land reported in the property, plant, and equipment section of a manufacturing company’s balance sheet is reported at Select the correct answer. a. historical cost b. historical cost, less accumulated depreciation c. fair value d. lower of cost or market value 6. Rent revenue collected one month in advance should be accounted for as Select the correct answer. a. revenue in the month collected b. a current liability c. a separate item in stockholders’ equity d. an accrued liability 7. Which of the following should be disclosed in the Summary of Significant Accounting Policies? Select the correct answer. a. Rent expense amount b. Maturity dates of long-term debt c. Methods of amortizing intangibles d. Composition of plant assets 8. A company receives an advance payment for special order goods to be manufactured and delivered within six months. The advance payment should be reported on the company’s balance sheet as a Select the correct answer. a. deferred charge b. contra-asset account c. current liability d. noncurrent liability 9. Which of the following may be used to determine fair value based on Level 3 inputs? Select the correct answer. a. Net Realizable Present value value No No b. Net Realizable Present value value No Yes c. Net Realizable Present value value Yes No d. Net Realizable Present value value Yes Yes 10. The balance sheet provides information about each of the following items, except Select the correct answer. a. operating capability of entity b. results of entity’s operations c. entity’s liquidity d. financial flexibility of entity

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