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NEW YORK STATE FBLAACCOUNTING I2012PLEASE DO NOT OPEN THIS TEST UNTIL DIRECTED TO DO SOTest DirectionsComplete the information requested on the answer sheet.PRINT YOUR NAME on the “Name” line.PRINT the name of the event, ACCOUNTING I on the “Subject” line.PRINT the name of your CHAPTER on the “DATE” line.All answers will be recorded on the answer sheet.Please do not write on the test booklet.Scrap paper will be provided.Read each question completely before answering. With a NO. 2 pencil, blacken in your choices completely on the answer sheet. Do not make any other marks on the answer sheet, or the scoring machine will reject it.You will be given 60 minutes for the test. You will be given a starting signal and a signal after 50 minutes have elapsed.Tie will be broken using the last 10 questions of the test.1. Which of the following is an example of a not-for-profit organization?a. General Electricb. Nikec. Salvation Armyd. Sony2. Which of the following is an example of a service business?a. Appleb. Bank of Americac. Macy’sd. Toyota3. Which of the following is an example of a manufacturing business?a. General Motorsb. JC Penneyc. Super Cutsd. Target4. Which of the following is a disadvantage of a sole proprietorship?a. All profits go to the ownerb. Double taxationc. Limited liabilityd. Limited life5. Which of the following is an advantage of a partnership?a. Easy to expandb. Easy to startc. Easy to transfer ownershipd. Unlimited life6. Which of the following is NOT a characteristic of a corporation?a. Complex to organizeb. Double taxationc. Easy to raise moneyd. Unlimited liability7. What does GAAP stand for?a. General Accounting Assumption Producersb. Generally Accepted Accounting Principlesc. Global Accounting Action Pland. Globally Agreed Accounting Procedures8. Which of the following is most likely to use the managerial accounting reports of a business?a. Creditorsb. Department headsc. IRSd. Union leaders9. Assuming that a business will continue to operate is the __________ accounting assumption.a. accounting periodb. business entityc. going concernd. revenue recognitionUse the following information to answer questions 10-11.Accounts Payable$ 2,000Equipment$ 5,000Accounts Receivable 3,000Office Supplies 500Cash in Bank 10,000Trucks 15,00010. What is the value of total assets?a. $10,000b. $15,000c. $33,500d. $35,50011. What is the value of total owner’s equity?a. $2,000b. $20,500c. $31.500d. $35,50012. Which of the following assets is the most liquid?a. Accounts Receivableb. Cash in Bankc. Merchandise Inventoryd. Notes ReceivableUse the following information to answer questions 13-15.Provided services worth $600 on account.13. What account will be debited?a. Accounts Payableb. Accounts Receivablec. Cash in Bankd. Service Revenue14. What account will be credited?a. Accounts Payableb. Accounts Receivablec. Cash in Bankd. Service Revenue15. Which of the following describes the effect of the transaction on the accounting equation?a. Assets decrease and liabilities decrease.b. Assets increase and owner’s equity increases.c. Assets increase and liabilities increase.d. Liabilities increase and owner’s equity decreases.16. Which of the following accounts is increased with a debit?a. Accounts Payableb. E. Garofalo, Capitalc. Maintenance Expensed. Rental Revenue17. Which of the following accounts is increased with a credit?Cash in BankDelivery RevenueIncome SummaryP. Tambroni, WithdrawalsUse the information below to answer questions 18-21.Bought a used truck on account for $15,000.What account will be debited?Accounts PayableAccounts ReceivableCash in BankDelivery EquipmentWhat account will be credited?Accounts PayableAccounts ReceivableCash in BankDelivery EquipmentWhich type source documents would serve as evidence of this transaction?Check stubInvoiceMemorandumReceiptWhich of the following describes the effect of the transaction on the accounting equation?Assets decrease and liabilities decrease.Assets increase and liabilities increase.Assets increase and owner’s equity increases.Liabilities increase and owner’s equity increases.Use the information below to answer questions 22-25.Received and deposited a $200 check to apply on a customer’s account.What account will be debited?Accounts PayableAccounts ReceivableCash in BankService RevenueWhat account will be credited?Accounts PayableAccounts ReceivableCash in BankService RevenueWhich type of source document would serve as evidence of this transaction?Check stubInvoiceMemorandumReceiptWhich of the following describes the effect of the transaction on the accounting equation?Assets decrease and liabilities decrease.Assets increase and liabilities increase.Liabilities decrease and owner’s equity increases.The equation stays the same.A __________ error occurs when a decimal point is moved by mistake.balanceproofslidetranspositionWhich of the following situations requires a correcting entry?A $20 debit to the Store Supplies account was posted as a credit.A $65 debit to the withdrawals account was posted as $56.A $100 debit to Cash in Bank was posted as $10.A $200 purchase of store equipment was journalized and posted to Store Supplies.Which of the following situations would NOT affect the Trial Balance?A $100 check received from a customer was journalized as a debit to Cash in Bank but was not posted to the Cash in Bank account.A $200 credit to Service Fees in the general journal was posted as $2,000.A check for $400 received from a charge customer was not journalized.The balance of Cash in Bank was incorrectly calculated and understated by $200. Transposition errors are evenly divisible by the number __________.2359Which of the following steps in the accounting cycle is in the correct order?Analyze each transaction, journalize, collect source documents, prepare a trial balance, and post.Collect and verify source documents, analyze each transaction, prepare a trial balance, journalize each transaction, and post to the ledger.Collect and verify source documents, analyze each transaction, journalize each transaction, post to the ledger, and prepare a trial balance.Post to the ledger, prepare a trail balance, journalize, analyze each transaction, and collect source documents.A(n) __________ is a working paper used to collect information from the ledger accounts in one place.Balance SheetIncome StatementStatement of Changes in Owner’s EquityWork SheetThe __________ account is classified as an owner’s equity account and has a normal debit balance.Income SummaryJ. Judge, CapitalJ. Judge, WithdrawalsUtilities ExpenseWhich of the following accounts is NOT a permanent account?Accounts PayableCash in BankOffice SuppliesSalaries ExpenseThe __________ principle states that expenses are compared to revenues for the same period.conservatismconsistencymatchingrevenue recognitionWhich of the following accounts would NOT appear on the Balance Sheet?Accounts PayableCash in BankIncome SummaryR. Russo, WithdrawalsUse the general ledger accounts and balances below to answer questions 36-39.Cash in Bank$ 2,834L. Perry, Capital$20,419Utilities Expense1,283Accounts Receivable384Supplies307Income Summary0Office Equipment5,902Service Revenue9,179Advertising Expense795 Rafting Equipment8,351Computer Equipment3,295Maintenance Expense125Rent Expense2,000Hiking Equipment922Office Furniture2,804 Accounts Payable1,204L. Perry, Withdrawals1,800What is the total of the debit column on the Trial Balance section of the Work Sheet?$4,203$26,599$30,802$61,604What is the total of the debit column on the Balance Sheet section of the Work Sheet?$4,976$9,179$24,799$26,599What is the total of the credit column on the Income Statement section of the Work Sheet?$4,203$9,179$21,623$30,802What is the net income or net loss for the period?$4,203 net loss$4,976 net income$9,179 net loss$24,799 net incomeUse the information below to answer questions 40-42.Revenue$13,980Expenses9,440Investments1,300 Beginning Capital20,870Withdrawals1,700What is the ending capital balance?$16,730$25,010$28,410$47,290What is the return on sales?13.77%32.47%55.90%67.53%The purpose of the __________ is to ensure that assets equal liabilities plus owner’s equity.Balance SheetIncome StatementStatement of Cash FlowsStatement of Changes in Owner’s Equity__________ entries are journal entries made to reduce to zero the balances in the temporary capital accounts and transfer the net income or net loss for the period to the capital account.AdjustingClosingGeneral journalSpecial JournalWhich of the following accounts would NOT appear on a Post-Closing Trial Balance?Accounts ReceivableS. Zawada, CapitalS. Zawada, WithdrawalsSales Tax PayableThe bank on which a check is written is the __________.draweedrawerpayeepayerA __________ is the person to whom a check is written.draweedrawerpayeepayerA(n) __________ limits how a check may be handled.blank endorsementendorsement in fullfull endorsementrestrictive endorsement__________ checks are checks that have been written but have not yet been presented to the bank for payment.CanceledNSFOutstandingVoidedUse the information below to answer questions 49-51.Employees are paid weekly with overtime after 40 hours per week. The overtime rate is 1.5 times the regular rate of pay. Payroll information for the week follows:EmployeePay RateHoursDaniel Bean$9.2546Kathy Smith$8.3039.5Hillary Zengas$8.7534.25How much did Kathy Smith earn for the week?$299.69$327.85$453.22$491.78What is Daniel Bean’s overtime rate?$1.50$9.25$13.88$83.28What are the total earnings for the week for all of the employees?$119.75$998.34$1,053.04$1,080.76Joyce Jones is paid a 5% commission on all her sales plus a salary of $250 per week. Last week Joyce’s total sales were $8,254. What were her earnings for the week?$250.00$412.70$662.70$4,377.00Tom Chase is paid an annual salary of $52,450 and receives biweekly paychecks. What are his gross earnings in each check?$1,008.65$2,017.31$2,185.42$4,370.83Which of the following is a voluntary payroll deduction?Federal Income TaxMedicareSocial SecurityUnion duesA sale of merchandise on account should be recorded in the __________ Journal.Cash PaymentsCash ReceiptsPurchasesSalesA __________ account’s balance equals the total of all the account balances in the subsidiary ledger.contracontrollingcreditdebitUse the following information to answer questions 57-62.April 1Sold $2,500 of merchandise on account to Schoharie High School with credit terms 3/15, n/45.April 15Received payment on account from Schoharie High School.How much will Matt’s Motors pay for the merchandise if they pay within the discount period?$1,750$2,125$2,425$2,500What account should be debited on April 1?Accounts ReceivableCash in BankSalesSales DiscountWhat amount should be debited on April 1?$1,750$2,125$2,425$2,500How many accounts should be credited on April 1?onetwothreefourHow many accounts should be debited on April 15?onetwothreefourWhat account should be credited on April 15?Accounts ReceivableCash in BankSalesSales DiscountsUse the information below to answer questions 63-65.Bankcard sales totaled $750 plus $60 sales tax, Tape 65.What account(s) should be debited?Accounts ReceivableCash in BankCash in Bank and Sales Tax PayableSalesWhat account(s) should be credited?Accounts Receivable and SalesCash in BankSalesSales and Sales Tax PayableThe __________ Journal should be used to record this entry.Cash PaymentsCash ReceiptsPurchasesSalesA purchase __________ is a written request that a certain item be purchased.accountformorderrequisitionA __________ memorandum is used to notify suppliers of a return.allowancecreditdebitreturnFOB __________ means that the buyer pays the shipping charge from the supplier’s shipping mon carriercreditdestinationshipping pointWhich column in the Purchases Journal must be used for every transaction?Accounts Payable CreditAccounts Payable DebitPurchases CreditPurchases DebitThe entry to record a bank service charge should be entered in the __________ Journal.Cash PaymentsCash ReceiptsGeneralSalesUse the information below to answer questions 71-73.Your company has a general ledger account balance of $73,395 for Merchandise Inventory as of July 1. On the following June 30, the end of the fiscal period, a physical inventory determined there was $74,928 in merchandise on hand. You are preparing the adjusting entries on the worksheet.What is the amount of the inventory adjustment?$1,533$73,395$74,928$148,323What account is debited?Cash in BankIncome SummaryMerchandise InventoryPurchasesWhat account is credited?Cash in BankIncome SummaryMerchandise InventoryPurchasesUse the following information to answer questions 74-77.Your company paid the semi-annual insurance premium of $4,440 on November 1. Today is December 31 and you are preparing the adjusting entries on the worksheet.What is the amount of the adjustment?$370$740$1,480$4,440What account is debited?Cash in BankIncome SummaryInsurance ExpensePrepaid InsuranceWhat account is credited?Cash in BankIncome SummaryInsurance ExpensePrepaid InsuranceThe adjusting entry should be recorded in the __________ Journal.Cash PaymentsCash ReceiptsGeneralPurchases__________ represents the increase in stockholders’ equity from the portion of net income not distributed to the stockholders.Capital StockDividends PayableIncome SummaryRetained EarningsA __________ corporation is one whose stock is widely held.closely heldlimited liabilitypublicly heldsecuritiesAll corporations issue __________ moncumulativeparticipatingpreferredWhich of the following transactions would appear on the Statement of Stockholders’ Equity?Bought equipment on account at a total cost of $125,000.Paid a cash dividend of $12,000 for all common stockholders.Paid accounts payable of $30,000.The board of directors declared a cash dividend of $12,000 for all common stockholders.Use the following information to answer questions 82-85.Your company recently incorporated and is authorized to issue 10,000 shares of $25 par common stock. You received $31 per share for 2,000 shares of common stock.How many accounts are debited?onetwothreefourHow many accounts are credited?onetwothreefourHow much did you received for the shares?$50,000$62,000$250,000$310,000Which of the following would serve as a source document for this transaction?Check stubInvoiceMemorandumReceiptA __________ fund is used for incidental cash payments.changedisbursementemergencypetty cashWhich of the following is a current asset?Accounts receivableAccounts payableEquipmentLandUse the following information to answer questions 88-93.Your company purchased a computer two months ago for $6,500. It has an estimated disposal value of $1,500 and an estimated useful life of 5 years. It is the end of the fiscal year and you are using the straight-line depreciation method.What is the depreciable cost of the computer?$300$1,500$5,000$6,500What is the annual depreciation expense?$300$1,000$1,300$5,000What is the depreciation expense for the first year?$83.33$166.67$500.00$1,000.00What account is debited to record the depreciation?Accumulated DepreciationCash in BankComputer EquipmentDepreciation ExpenseWhat account is credited to record the depreciation?Accumulated DepreciationCash in BankComputer EquipmentDepreciation ExpenseThe __________ Journal is used to record the adjusting entry for depreciation.Cash PaymentCash ReceiptsGeneralPurchasesThe __________ method of accounting for uncollectible accounts matches the estimated uncollectible accounts expense with sales made during the same period.allowancedirect write-offnetrelevanceUse the following information to answer questions 95-98.You are responsible for preparing a purchase requisition for the following items:QuantityItem DescriptionUnit Price1Box of Copy Paper$34/box5Reams of Art Paper$12/ream2Globes$55/ea.100No. 2 Pencils$.12/ea.4 doz.Transparency Markers$6.50/doz.The shipping costs are 10% of the total.What is the total cost of the No. 2 pencils?$1.20$12.00$120.00$1,200.00What is the total of all of the items, excluding shipping?$107.62$156.00$242.00$266.20What is the shipping charge?$10.76$15.60$24.20$26.62What is the total of the purchase requisition?$118.38$171.60$266.20$292.82The __________ ratio is a measure of a business’s ability to pay its current debts as they become due and to provide for unexpected needs of cash.currentliabilityliquidityquickA __________ note payable is a note from which the interest is deducted at the time the note is made.interest-bearingnegotiablenoninterest-bearingpromissoryANSWER KEYcbadbdbbcccbbdbcbdabbcbddcdcdcdcdcccdbbbbabcacdcbcdcbddbcadababdbdcdaaacbccdcdcadabbddacbbdacabccccc ................
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