Devry ACCT504 week 8 final exam set 2 36 mcq

1) Which of the following is an external user of accounting
information? a.Managers b.Labor unions c.Finance directors d.Company officers

2) The accounting process is correctly sequenced as
A.communication, recording, identification.b identification, communication,
recording.c.recording, communication, identification.d.identification,
recording, communication.

3) Communication of economic events is the part of the
accounting process that involves a.recording and classifying
information.b.identifying economic events.C.quantifying transactions into
dollars and cents. D.preparing accounting reports.

4) The body of theory underlying accounting is not based on
a.definitions.b.physical laws of nature.C.concepts.D.principles.

6) The private sector organization involved in developing
accounting principles is the a. Financial Auditors’ Standards Body. b.Feasible
Accounting Standards Body.c.Financial Accounting Studies Board.d.Financial
Accounting Standards Board.

7) All of the financial statements are for a period of time
except the A.statement of cash flows.B.income statement.C.retained
earnings.D.balance sheet.

8) After a business transaction has been analyzed and
entered in the book of original entry, the next step in the recording process
is to transfer the information to A.financial statements. B.the company’s
bank.C.stockholders’ equity. D.ledger accounts.

9) Auditing is a. conducted by the Securities and Exchange
Commission to ensure that registered financial statements are presented
fairly.b.the examination of financial statements by a CPA in order to express
an opinion on their fairness.c.a part of accounting that involves only
recording of economic events.d.an area of accounting that involves such
activities as cost accounting, budgeting, and accounting information systems.

10) In recording an accounting transaction in a double-entry
system A.there must only be two accounts affected by any transaction. b.the
number of debit accounts must equal the number of credit accounts.c.there must
always be entries made on both sides of the accounting equation.D.the amount of
the debits must equal the amount of the credits.

11) If a company has overdrawn its bank balance, then a. it
cannot be detected by observing the balance of the cash account.B.the cash
account debits will exceed the cash account credits.c.its cash account will
show a debit balance.d. its cash accounts will show a credit balance

12) An account will have a credit balance if the A.last
transaction entered was a credit. B.first transaction entered was a
credit.c.credits exceed the debits.d.debits exceed the credits.

13) On August 13, 2008, Dudbury Enterprises purchased office
equipment for $1,000 and office supplies of $200 on account. Which of the
following journal entries is recorded correctly and in the standard format?

Office
Equipment 1,000
Office Supplies 200
Account Payable 1,200

18) Adjusting entries are required a.when revenues are
recorded in the period in which they are earned.b.when the company’s profits
are below the budget.c.when expenses are recorded in the period in which they
are incurred.d.because some costs expire with the passage of time and have not
yet been journalized.

27) The worksheet does not show a. the trial balance before
adjustments. B. the ending balance in the retained earnings account.c.revenue
and expense account balances.d.net income or loss for the period.

28) In order to close the dividends account, the a.retained
earnings account should be debited.b.retained earnings account should be
credited.c.income summary account should be credited.d.income summary account
should be debited.

39) The entity responsible for setting International
Accounting Standards is:A.The Financial Accounting Foundation B.The Financial
Accounting Standards Board C.The International Accounting Standards Board d.The
International Monetary Fund

Joe is warehouse custodian and also maintains the accounting
record of the inventory held at the warehouse. An assessment of this situation
indicates A.establishment of responsibility is violated.b.documentation
procedures are violated.c.independent internal verification is violated.d.segregation
of duties is violated.

41) An employee authorized to sign checks should not record
A.cash disbursement transactions.
b sales transactions.
c.owner cash contributions.
d.mail receipts.

42) Allowing only the treasurer to sign checks is an example
of A. establishment of responsibility. B documentation procedures.cother
controls.d.segregation of duties.

38) The importance of a good system of internal controls was
recognized with the passage of A.the Securities and Exchange Act of 1933.b the
Securities and Exchange Act of 1994. cthe Sarbanes-Oxley Act of 2002. d.the
Blue Sky Laws.

36) Which one of the following is not an objective of a
system of internal controls? A. overstate liabilities in order to be
conservative B. Enhance the accuracy and reliability of accounting records C.
Reduce the risks of errors D. Safeguard company assets