61. The review of a capital budgeting decision to determine whether a project was accepted that should have been rejected is referred to as:  A. An audit. B. A preaudit. C. A postaudit. D. A capital review. 62. Six years ago, Torrence Hardware paid a contractor $45,000 to expand the store. At that time, the company calculated a net present value of about $6,000 for the expansion. Now, the company […]

    112. Consider the following inventory data:   Beginning inventory$150,000   Ending inventory  100,000 Purchases                     310,000   What is the average days in inventory for the year? a. 126.7 days. b. 101.4 days. c. 152.0 days. d. 111.7 days.     113. The following balances come from the financial statements of Way Industries: Sales revenue $850,000 Accounts receivable $280,000 Beginning inventory $50,000 Ending inventory […]

  11) Which of the following statements about activity-based costing is true? A) It does not affect cost control. B) Indirect cost allocation bases are unlikely to be cost drivers. C) It provides less information than traditional cost systems. D) It provides similar results to traditional costing when one activity creates a substantial amount of total cost. E) It provides similar results to traditional costing […]

  99.              A Budgetary Comparison Schedule is: A)optional under GASB standards for all funds. B)required by GASB for internal management reports only; not permitted for external financial reporting. C)required for all governmental fund types. D)required for the General Fund, and for special revenue funds, for which an annual budget has been adopted. 100.              When a computer which is to be used by an activity accounted […]

  8.Nigel Corporation reported income from continuing operations before taxes and before adjustment of the transactions below in the amount of $1,000,000. A review of the 2009 income statement revealed several items that appeared to be incorrectly categorized. The following items were flagged: a.Recorded a loss of $29,000 due to a vandalism attack by a gang on one of the company warehouses; vandalism attacks have […]

  85.Chandler Company purchased merchandise on credit from Lighting Supply for $5,600. Chandler would record this sale in the:     A. General journal. B. Cash receipts journal. C. Cash disbursements journal. D. Purchases journal. E. Accounts Payable controlling account. 86.Doughton Furniture Company purchased merchandise on credit from Furniture Supply for $8,000. Two days later Doughton returned $2,000 of the merchandise due to damage. Doughton would record the return of merchandise […]

  18) Under the proration approach, the sum of the amounts shown in the subsidiary ledgers will not match the amounts shown in the general ledger because no adjustments from budgeted to actual manufacturing overhead rates are made in the individual job-cost records.   19) The actual costs of all individual overhead categories are recorded in the Manufacturing Overhead Control account.   20) Proration is […]

41) The following accounts appear in the adjusted trial balance columns of a worksheet. State the column that each account balance is extended to, choosing from the following columns:   1) income statement debit 2) balance sheet debit 3) income statement credit 4) balance sheet credit   a) _________  service revenue b) _________  unearned service revenue c) _________  land d) _________  rent expense e) _________  […]

  Multiple Choice Questions  58.In periods of rising prices, the inventory valuation procedure that results in the highest net income is    A. the lower of cost or market method.   B. the LIFO method.   C. the average cost method.   D. the FIFO method.         59.If other items remain the same, the larger the ending inventory valuation, the    A. higher the cost of goods sold.   […]

  84. All of the following are true of financial statement analysis report, except:  A.  Contains ambiguities and qualifications. B. Forces preparers to organize their reasoning and to verify the logic of analysis. C. Serves as a method of communication to users. D. Helps users and preparers to refine conclusions based on evidence from key building blocks. E. Enables readers to see the process and rationale of analysis. 85. When a […]