Financial Accounting Paper 2

1

Careful reading of an annual report will reveal that off-balance-sheet debt includes






2

Which one of the following is not a form of off-balance-sheet financing?






3

In a multiple-step income statement for a retail company, all of the following are included in the operating section except






4

When reporting extraordinary items,






5

The major segments of the statement of retained earnings for a period are






6

In recording transactions, which of the following best describes the relation between expenses and losses?






7

An entity has a 50% gross margin, general and administrative expenses of $50, interest expense of $20, and net income of $10 for the year just ended. If the corporate tax rate is 50%, the level of sales revenue for the year just ended was






8

Assume that employees confessed to a $500,000 inventory theft but are not able to make restitution. How should this material fraud be shown in the company’s financial statements?






9

An entity had the following opening and closing inventory balances during the current year:
................................1/1............ 12/31
Finished goods..... .. $ 90,000..... $260,000
Raw materials..... ... 105,000...... 130,000
Work-in-progress..... 220,000...... 175,000
The following transactions and events occurred during the current year:
$300,000 of raw materials were purchased, of which $20,000 were returned because of defects.
$600,000 of direct labor costs were incurred.
$750,000 of production overhead costs were incurred.
The cost of goods sold for the current year ended December 31 would be






10

If the beginning balance for May of the materials inventory account was $27,500, the ending balance for May is $28,750, and $128,900 of materials were used during the month, the materials purchased during the month cost






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