(123doc) - Tai-Lieu-Accounting-Principles-Mid-Semester-Test PDF
(123doc) - Tai-Lieu-Accounting-Principles-Mid-Semester-Test PDF
(123doc) - Tai-Lieu-Accounting-Principles-Mid-Semester-Test PDF
Accounting principles
Mid-semester test
BA-K06 - Tutorial 1&2
Student ID Number:
Student’s Name:
There are 15 questions, each worth 1.5 marks. For each question, choose the best answer and circle
the appropriate letter.
1. If the equipment account has a balance of $22,500 and its accumulated depreciation account
has a balance of $14,000, the book value of equipment would be?
a. $36,500
b. $22,500
c. $14,500
d. $8,500
3. If the supplies account before adjustment on May 31, indicated a balance of $2,250 and
supplies on hand at May 31 totaled $950, the adjusting entry would be
a. Dr Supplies $950 c. Dr Supplies expense $950
Cr Supplies expense $950 Cr Supplies $950
b. Dr Supplies $1,300 d. Dr Supplies expense $1,300
Cr Supplies expense $1,300 Cr Supplies $1,300
4. The form listing the titles and balances of the accounts in the ledger on a given date is
a. Income Statement
b. Balance Sheet
c. Statement of Owner’s equity
d. Trial balance
5. A debit may signify a(n)
a. Increase in an asset account
b. Decrease in an asset account
c. Increase in liability account
d. Increase in owner’s equity account
6. Which of the following accounts would not be included in a post-closing trial balance?
a. Fees earned
b. Account payable
c. Smith, capital
d. Accumulated depreciation
8. Which of the following items of expenditure would not be regarded as purchases for a
restaurant?
a. Potatoes
b. Cooking oil
c. Printing menus
d. Flour
10. If merchandise is sold on account to a customer for $1,000, terms FOB shipping point, 1/10,
n/30 and the seller prepays $50 in transportation costs, the amount of discount for early
payment would be?
a. $0
b. $5
c. $10
d. $10.5
11. Which of the following errors would not be detected by trial balance?
a. A transaction is debited to the right account but not credited to any account
b. A transaction is posted to the right accounts by for wrong amount
c. A transaction is recorded only on the credit side of the accounts
d. One of the accounts has been balanced incorrectly
12. Which of the following account concepts states that costs should be allocated to the
accounting period in which the revenue they help generate is recorded?
a. Matching
b. Consistency
c. Accounting entity
d. Going concern
2
13. On a multiple step Income Statement, the excess of net sales over the cost of merchandise
sold is called
a. Operating income
b. Income from operations
c. Gross profit
d. Net profit
14. Which of the following documents are used to record return of merchandised by a customer?
a. An invoice
b. A receipt
c. A delivery note
d. A credit memorandum
15. Which of the following accounts is not closed during the closing process at the end of the
accounting period?
a. Sales revenue
b. Salary expense
c. Income Summary
d. Retained Earnings
3
Total 750,000 750,000
Danville Company is a small editorial services company owned and operated by Dave Mayer. On
December 31, 20X8, the end of the current year, Danville Company’s accounting clerk prepared the
unadjusted trial balance shown at the previous page. The data needed to determine year-end
adjustments are as follows:
a. Unexpired insurance at December 31, $2,700
b. Supplies on hand at December 31, $480
c. Depreciation on building for the year, $1,600
d. Depreciation of equipment for the year, $4,400
e. Rent unearned at December 31, $3,250
f. Accrued salaries at December 31, $2,800
g. Fees earned but unbilled on December 31, $6,200
Required:
(i) Prepare necessary adjusting entries as at 31 December, 20X8 (14 marks)
(ii) Complete the worksheet on the previous page (26 marks)
(i) The following were selected from transactions completed by Southmont. Prepare journal entries
to record each transactions (including an explanation for each entry): (16 marks)
Apr 3 Purchased merchandise on account from Mandell for $18,000, terms FOB
destination, 2/10, n/30. Transportation cost of $250. (2 marks)
Apr 6 Returned $3,500 of merchandise purchased from Mandell (2marks)
Apr 11 Sold merchandise on account to Campo Co, $12,800 terms 1/10, n/30. Cost of
merchandise sold $7,600 (3 marks)
Apr 12 Paid Mandell on account (3 marks)
Apr 15 Received merchandise returned by Campo from sale on Apr 11 $1,600. Cost of
merchandise sold $950 (3 marks)
Apr 20 Received cash on account from Campo (3 marks)
(ii) Prepare extracted Income Statement to Gross profit for Southmont for Apr (6 marks)
(iii) Southmont uses a perpetual inventory system. The company experienced a normal inventory loss
of $4,300. What accounts would be debited and credited to record the adjustment for inventory
loss at end of period (3 marks).
Question 3 (5 marks)
Explain why accounting standards are necessary.