F1

Question 1

Where will a gain/loss on the sale of a fixed asset be recorded?

Answer 1

Continuing Operations

Question 2

Will the gain on the sale of a fixed asset be net of income taxes?

Answer 2

No

Question 3

Where are purchase discounts recorded on the single step income statement?

Answer 3

They reduce cost of goods sold

Question 4

What is included in revenues on the single step income statement?

Answer 4

Sales of Goods
Sale of Services
Rentals

Question 5

What does comprehensive income NOT include?

Answer 5

Changes in equity resulting from owner investments and distributions to owners.

Question 6

Is a Discount on Bonds Payable a decrease in liabilities?

Answer 6

Yes - It should reduce total liabilities on the balance sheet.

Question 7

When can a discontinued operation be reported as a discontinued operation?

Answer 7

When the company classifies it as “held for sale”

Question 8

What does it mean to quote the exchange rate using the direct method?

Answer 8

Quoting the domestic price of one unit of another currency from the perspective of the retailer. If the retailer is in a foreign country then the domestic currency would be the foreign currency and not the US $.

Question 9

If the US $ appreciates relative another currency will you need more or less of the other currency to purchase the US $?

Answer 9

More of the other currency.

Question 11

At year end Net Income is closed to retained earnings just like Other Comprehensive Income is closed to…

Answer 11

Accumulated other comprehensive income

Question 12

What is .79 EURO converted to the US$.

Answer 12

$1.27

=1.00/.79

Question 13

Are unrealized losses & gains recorded on the income statement?

Answer 13

Yes, they are recorded in Comprehensive Income

Question 14

Is Other Comprehensive Income taxed on the income statement?

Answer 14

No

Question 15

Is interest expense taxed on the income statement?

Answer 15

Yes

Question 16

Is Unrealized holding gain on available for sale debt securities recorded in other comprehensive income or comprehensive income?

Answer 16

Comprehensive Income

Question 17

Which form reports on major corporate events, including corporate asset acquisitions/disposals, accountant changes, financial statement changes, management changes, etc.

Answer 17

Form 8-K

Question 18

Does a stock dividend create new shares?

Answer 18

Yes

Question 19

When working a problem that involves cumulative preferred stock do you use the accumulated dividends or the paid dividends in the problem?

Answer 19

Accumulated dividends.

Question 20

If the exercise price exceeds the market price of the stock what does that mean for the diluted EPS calculation?

Answer 20

It will not be included because that would mean the stock is antidilutive and diluted EPS would equal basic EPS.

Question 21

A company is an accelerated filer that is required to file Form 10-K. What is the maximum number of days after the company’s fiscal year end that the company has to file Form 10-K with the SEC?

Answer 21

75 days

Question 22

For large accelerated and accelerated filers, the 10-Q is due within how many days of the period end.

Answer 22

40

Question 23

Does appropriated retained earnings included restricted cash?

Answer 23

No

Question 24

How should the shares of a companies owns stock held in the investments section of the balance sheet be considered in stockholders equity?

Answer 24

It should reduce stockholders equity.

Question 25

Are dividends in arrears reported as a liability?

Answer 25

No. They are only a disclosure in the financial statements.

Question 26

Are gains and losses on treasury stock recorded on the income statement?

Answer 26

No.

Question 27

When do you record a decrease in retained earnings for dividends.

Answer 27

When it is declared. Not paid.

Question 28

Where would the change in warranty cost estimate be recorded?

Answer 28

As income from continuing operations. No restatement needed for an accounting change.

Question 29

Do financial statements have to be restated if there has been a change in entity?

Answer 29

Yes. All prior periods presented should be restated.

Question 30

If a company changes from cash basis to accrual basis would that be a change in accounting principle, accounting estimate, or accounting error?

Answer 30

Error

Question 31

If a company changes from FIFO to LIFO would that be a change in accounting principle, accounting estimate, or accounting error?

Answer 31

Principle

Question 32

Change in accounting principles are recorded…

Answer 32

Prospectively

Question 33

Which statements do a nongovernmental not for profit organization have to have in their financials?

Answer 33

1. Statement of financial position
2. Statement of activities
3. Statement of cash flows

Question 34

FASB ASC 958 =

Answer 34

Basic Information

Question 35

How should not for profit orgs disclose expenses in the footnotes?

Answer 35

By functional AND natural classification

Question 36

Is a quasi-endowment restricted?

Answer 36

No

Question 37

Is an endowment in perpetuity restricted?

Answer 37

Yes

Question 38

Which funds are fully expendable and may be entirely used up?

Answer 38

Special

Question 39

Which funds are nonexpendable and legally restricted to the extent of income?

Answer 39

Permanent

Question 40

What type of accounting does Government Wide Funds use?

Answer 40

Accrual basis

Question 41

What is the pneumonic for Governmental Funds

Answer 41

MAC-GRaSPP

M - Modified
A - Accrual
C- Current

G - General
R - Special Revenue
and
S - Debt Service
P - Capital Projects
P - Permanent

Question 42

What is the pneumonic for Proprietary and Fiduciary Funds

Answer 42

SCARE

S - SE
S - Service
E - Enterprise
C - Cippoe
C - Custodial
I - Investment
P - Private Purpose
P - Pension
OE - Other Employee benefit
A - Accrual
R - Record non current A&L
E - Economic

Question 43

A company is a large accelerated filer that is required to file Form 10-K. What is the maximum number of days after the company’s fiscal year end that the company has to file Form 10-K with the SEC?

Answer 43

60 days