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ACC 400 Week 1 E-text Individual Assignments Problem Set P7-3B & Exercise E9.4 &
Exercise 9.8
ACC 400 Week 2 E-text Individual Assignments Chapter 8 Questions 3 and 4, Exercise
E8-5 & Exercise E9.9
ACC 400 Week 2 Team Assignment-Text Assignments Exercise E7-2 & Problem Set B P72B
What is horizontal analysis? What is the value in using horizontal analysis? Why would a
company use this analysis? What does this analysis tell you?
What are examples of irregular items? How does a change in accounting principles affect the
financial statements? Who in the organization is responsible for the application of a change in an
accounting principle? Why?
What are the three most common types of ratios? Why are they important? Which ratios would
you use to determine the long-term viability of an organization? Why?
ACC 400 Week 3 E-text Individual Assignments Chapter 10 Questions 1, 7, 8, and 19, BE
10-1, BYP10-1, BYP11-10 & Internet Assignment 11-1
ACC 400 Week 3 Summary
ACC 400 Week 3 Team Assignment-Text Assignments Chapter 13 13-4A
What are some of the various lease options? When would you use one option over the others?
What could be the financial impact of this decision?
ACC 400 Week 4 DQ 2
Under which circumstances would you lease versus purchase? What are the criteria that
you would use to make this decision? What is the financial impact of this decision?
What are the components of the capital structure? What are the differences of these components?
How do you determine the optimal mix of the components of the capital structure?
ACC 400 Week 4 Individual Assignment Debt Vs. Equity Financing Paper
ACC 400 Week 4 Summary
ACC 400 Week 4 Team Assignment Interpreting Financial Statements & BYP13-4 Coca
Cola-Pepsi
ACC 400 Week 4 Team Assignment Interpreting Financial Statements Report ACC 400
Week 4 Team Assignment BYP13-4 Coca Cola-Pepsi
ACC 400 Week 4 Team Assignment BYP13-4 Coca Cola-Pepsi ( Excel )
ACC 400 Week 5 E-text Individual Assignments 13-4 Application of SFAC No. 13, Case
23.1 & Case 23.2
ACC 400 Week 5 Final Answer Sheet
ACC 400 Week 5 Team Assignment-Text Assignments BYP 13-7, Exercises 23.10 and
23.12
9.8%
80 days
b)
86 days
c)
172 days
d)
129 days
The beginning balance of cash is $45,000. What is the budgeted ending balance of cash?
a.
$325,000
b.
$370,000
c.
$275,000
d.
$245,000
3. On January 1, a business exchanged a plant asset with a cost of $18,000 and accumulated
depreciation of $16,500 for a similar asset that had a list price of $23,000. The business received
a trade-in allowance of $2,100 on the old plant asset. What was the result of the exchange?
5. A companys past experience indicates that 60% of its credit sales are collected in the month
of sale, 30% in the next month, and 5 % in the second month after the sale; the remainder is
never collected. Budgeted credit sales were:
July
$120,000
August
September
72,000
180,000
6. A check for $275 is incorrectly recorded by a company as $257. On the bank reconciliation,
the $18 error should be
a.
b.
c.
d.
7.
a.
when recording uncollectible accounts expense, it is not possible to know which specific
accounts will not pay.
b.
uncollectible accounts that are written off must be accumulated in a separate account.
c.
d.
management needs to accumulate all the credit losses over the years.
8. Under the direct write-off method of accounting for uncollectible accounts, Bad Debts
Expense is debited
a. when a credit sale is past due.
b. at the end of each accounting period.
c. whenever a pre-determined amount of credit sales have been made.
d. when an account is determined to be uncollectible
9. Manning Company uses the percentage of receivables method for recording bad debts
expense. The accounts receivable balance is $200,000 and credit sales are $1,000,000.
Management estimates that 5% of accounts receivable will be uncollectible. What adjusting entry
will Manning Company make if the Allowance for Doubtful Accounts has a credit balance of
$2,000 before adjustment?
a. Bad Debts Expense ..
10,000
10,000
8,000
8,000
8,000
Accounts Receivable
d. Bad Debts Expense ..
Accounts Receivable
8,000
10,000
10,000
10.
a.
Is computed by dividing net credit sales for the accounting period by the cash realizable
value of accounts receivable on the last day of the accounting period.
b.
c.
d.
11.
a. acid-test ratio.
b. current ratio.
c. times interest earned ratio.
d. asset turnover ratio.
12.
13.
The 2007 financial statements of Shadow Co. contain the following selected data (in
millions).
Current Assets
$ 75
Total Assets
120
Current Liabilities
40
Total Liabilities
85
Cash
Interest Expense
Income Taxes
10
Net Income
16
14. The statement Bond prices vary inversely with changes in the market rate of interest means
that if the
a. market rate of interest increases, the contractual interest rate will decrease.
b. contractual interest rate increases, then bond prices will go down.
c. market rate of interest decreases, then bond prices will go up.
d. contractual interest rate increases, the market rate of interest will decrease.
16.
Which of the following is the appropriate general journal entry to record the declaration
of cash dividends?
a. Retained Earnings
Cash
b. Dividends Payable
Cash
c. Paid-in Capital
Dividends Payable
d. Retained Earnings
Dividends Payable
17.
Allstate, Inc., has 10,000 shares of 6%, $100 par value, cumulative preferred stock and
100,000 shares of $1 par value common stock outstanding at December 31, 2007. If the board of
directors declares a $50,000 dividend, the
a. preferred stockholders will receive 1/10th of what the common stockholders will receive.
b. preferred stockholders will receive the entire $50,000.
c. $50,000 will be held as restricted retained earnings and paid out at some future date.
d. preferred stockholders will receive $25,000 and the common stockholders will receive
$25,000.
a. prior years financial statements should not be changed to reflect the newly adopted
principle.
b. the new principle should be used in reporting the results of operations of the current year.
c. the cumulative effect of the change in principle should be reflected on the income statement
as of the beginning of the next year.
d. the cumulative effect of the change in accounting principle should be classified as an
extraordinary item on the income statement.
19.
a. Discontinued operations
b. Extraordinary items
c. Other revenues and expenses
20.
5. Martin Textile purchased machinery for $50,000 eight years ago. It was expected
to have a useful life of ten years, no salvage value, and was depreciated using the
straight-line method. At the end of its eighth year of use it was retired from service
and given to a junk dealer. The entry to record the retirement includes
7. On July 1, 2007, Low Enterprises sold equipment with an original cost of $85,000
for $40,000. The equipment was purchased January 1, 2006, and was depreciated
using the straight-line method assuming a five year useful life and $5,000 salvage
value. The necessary entries for 2007 include
9. Bonds that are subject to retirement at a stated dollar amount prior to maturity at
the option of the issuer are called a. options. b. early retirement bonds
10. The Muffin Company issued a five-year interest-bearing note payable for
$50,000 on January 1, 2005. Each January the company is required to pay $10,000
on the note. How will this note be reported on the December 31, 2006, balance sheet?
11. Toran Manufacturing declared an 10% stock dividend when it had 150,000
shares of $5 par value common stock outstanding. The market price per common
share was $12 per share when the dividend was declared. The entry to record this
dividend declaration includes a credit to
12. Richer Company paid $21,000 to buy 4,000 shares of its $6 par value common
stock for the treasury. The stock was originally sold for $25,000. The entry to record
the purchase includes
14. Ross Paints reported sales of $350,000, total assets of $150,000, total stockholders equity of $60,000, current assets of $50,000, current liabilities of $30,000,
and cash of $15,000. In a vertical analysis of the balance sheet, cash would be shown
as
16. Swanson Company had inventory of $220,000 and $180,000 on December 31,
2007, and December 31, 2006, respectively. Cost of goods sold for 2007 was
$1,520,000. Average days in inventory is approximately
17. If common stock is issued for an amount greater than par value, the excess
should be credited to
19. The financial statements of the Bolton Manufacturing Company reports net sales
of $500,000 and accounts receivable of $50,000 and $30,000 at the beginning of the
year and end of year, respectively. What is the receivables turnover ratio for Bolton?
20. The following credit sales are budgeted by Rodriguez Company: February
50,000 March 70,000 April 60,000 The companys past experience indicates that
80% of the accounts receivable are collected in the month of sale, 20% in the month
following the sale. The anticipated cash inflow for the month of April is
1. Under an operating lease, both the leased asset and the liability are shown on the
balance sheet.
2. Certain types of leases, called capital leases, allow the lessee to account for the
transaction as a rental.
3. The issuance of common stock affects both paid-in capital and retained earnings.
4. The acquisition of treasury stock by a corporation increases total assets and total
stockholders equity.
5. Treasury stock is reported as an asset on the balance sheet because treasury stock
may later be resold.
8. If a company has sales of $110 in 2007 and $154 in 2006, the percentage decrease
in sales from 2006 to 2007 is 140%.
9. Allowance for Doubtful Accounts is debited under the direct write-off method
when an account is determined to be uncollectible.
10. When the allowance method is used, the write-off of an account receivable
results in an expense at the time of write-off.
11. Allowance for Doubtful Accounts is a contra account that is deducted from
Accounts Receivable on the balance sheet.
13. When a monthly mortgage payment is made and recorded, the debit to Mortgage
Payable represents the reduction in the principal balance
PART III MATCHING 3 points each (42 points) Match the items below by entering
the appropriate code letter in the space provided. A. Prenumbered documents G.
Cash budget B. Custody of an asset should be kept H. Restricted cash separate from
the record-keeping I. Invest idle cash for that asset J. Canceled checks C. Television
monitors, garment sensors K. NSF checks and burglar alarms are examples L.
Outstanding checks D. Bonding employees M. Petty cash receipt E. Collusion N. Cash
equivalents F. Cash 1. Segregation of duties. 2. Cash that is not available for general
use, but instead is restricted for a particular purpose. 3. Two or more employees
circumventing prescribed procedures. 4. Prevent a transaction from being recorded
more than once. 5. Checks which have been returned by the makers bank for lack of
funds. 6. Checks which have been paid by the depositors bank. 7. A projection of
anticipated cash flows. 8. Anything that a bank will accept for deposit. 9. Mechanical
and electronic control devices. 10. A basic principle of cash management. 11.
Insurance protection against misappropriation of assets. 12. Document indicating
the purpose of a petty cash expenditure. 13. Issued checks that have not been paid
by the bank. 14. Highly liquid investments.
PART IV MATCHING 3 points each (30 points) Match the items below by entering
the appropriate code letter in the space provided. A. Serial bonds F. Current ratio B.
Debenture bonds G. Straight-line method of amortization C. Bond indenture H.
Times interest earned ratio D. Market interest rate I. Callable bonds E. Discount on
bonds payable J. Maturity date ____ 1. Bonds subject to retirement at a stated dollar
amount prior to maturity. ____ 2. A legal document that sets forth the terms of a bond
issue. ____ 3. Bonds that mature in installments. ____ 4. A measure of a companys
short-term liquidity. ____ 5. The time that the final payment on a bond is due from
the bond issuer. ____ 6. A measure of a companys solvency. ____ 7. The rate investors
demand for loaning funds to a corporation. ____ 8. Unsecured bonds issued against
the general credit of the borrower. ____ 9. Occurs when the contractual rate of
interest is less than the market rate of interest. ____ 10. Produces a periodic interest
expense that is the same amount each interest period.