Financial Accounting Paper 3

1

Given the following data for Scurry Company, what is the cost of goods sold?
Beginning inventory of finished goods.. $100,000
Cost of goods manufactured..................700,000
Ending inventory of finished goods........ 200,000
Beginning work-in-process inventory .....300,000
Ending work-in-process inventory .........50,000






2

The financial statement that provides a summary of the firm’s operations for a period of time is the






3

Unless the shares are specifically restricted, a holder of common stock with a preemptive right may share proportionately in all of the following except






4

Which one of the following statements is correct regarding the effect preferred stock has on a company?






5

On February 1, Year 1, a computer software firm agrees to program a software package. Twelve payments of $10,000 on the first of each month are to be made, with the first payment March 1, Year 1. The software is accepted by the client June 1, Year 2. How much Year 1 revenue should be recognized?






6

An airline should recognize revenue from airline tickets in the period when






7

A department store sells gift certificates that may be redeemed for merchandise. Each certificate expires 3 years after issuance. The revenue from the gift certificates should be recognized






8

To comply with the matching principle, the cost of labor services of an employee who participates in the manufacturing of a product normally should be charged to the income statement in the period in which the






9

Revenues of an entity are usually measured by the exchange values of the assets or liabilities involved. Recognition of revenue does not occur until






10

Robin Gavaskar, who recently founded a company that produces baseball bats and balls, wants to determine her company’s policy for revenue recognition. According to the revenue recognition principle, the mostappropriate time to recognize revenue would be when






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