The document summarizes an exam that the learner Ashan Silva took on FFAC Chapter 5. They received a score of 19 out of 20 (95%) and completed the exam in 24 minutes and 8 seconds. The exam consisted of 20 multiple choice questions covering various accounting concepts related to bonds, journal entries, inventory methods, depreciation, and financial statements.

1. Learner: Ashan Silva
Test Name FFAC Chapter 5 Completion Date 2015-03-07T01:42:13
Score 19.0 of 20.0 (95.00%) Timespent 00:24:08
Result Passed
Question Result / Notes
Order Name Score Notes
1 Bonds that are redeemable at a
predetermined price prior to final maturity
are commonly called
1.0
2 On May 1, 2011, Harman Corporation sold
$600,000 of 7%, 15-year bonds at a yield of
5% compounded semiannually for
$726,000. Interest is payable on May 1st
and November 1st of each year. The
corporation is a calendar-year corporation.
Bond premiums and discounts are
amortized on interest-paying dates and at
year end (round amounts to the nearest
dollar).
What is the correct journal entry to record
the issuance of the bonds on May 1st?
1.0
3 A local roofing company purchases a new
piece of land for $50,000 and a bulldozer for
$15,000 to help clear the land. In addition,
the company paid the following costs:
$1,000 to survey the land and $500 in legal
fees to acquire the land. What amount
would the company record as the initial cost
of the bulldozer?
1.0
4 On February 1st, Thomas Company
purchased equipment on account from
Stuart Company for $1,500. After receiving
the equipment, Stuart decides to return the
equipment on February 5th and receives full
credit for the refund. Which one of the
following accounts would Stuart debit on
February 5th?
1.0
5 What account classification is defined as
short-term financial obligations?
1.0
6 Lakeland Corporation issued $500,000 of 8-
year bonds at a coupon rate of 8% paid
annually when the market rate was 6%. The
net carrying value of the bond at the end of
the first year will be (to the nearest dollar)
0.0
Question Notes
Printed on: 3/7/2015

2. Order Name Score Notes
7 Clantech uses periodic inventory method
and FIFO cost flow assumption. Its
inventory transactions for the 2nd quarter of
Year 1 were as follows:
April 1 Beginning inventory 40 computers at
$1,250
May 15 Purchase 50
computers at $1,400
June 12 Purchase 30
computers at $1,500
During the 2nd quarter, Clantech sold 80
computers. What was the value of ending
inventory on June 30th Year 1?
1.0
8 A construction company purchased a new
machine for $150,000 on January 1, 2010.
The machine had a useful life of five years
or 100,000 machine hours. The machine
has a salvage value equal to $25,000 at the
end of its useful life. If the company applies
the double-declining balance method to
calculate depreciation, what is the total
depreciation expense for the second year?
1.0
9 The cost flow assumption that best suits the
business model of a diamond merchant who
sells diamonds of different sizes and quality
to jewelers is the
1.0
10 On January 1st, Martin Corporation was
authorized to issue 500,000 shares of
common stock, par value $2.00 per share,
and 20,000 shares of 5% cumulative
preferred stock, par value $80.00 per share.
What is the correct journal entry if the
company buys back 1,000 shares of
common stock for $5.00 per share?
1.0
11 Your company deposits $100 in your
retirement account each pay period. Which
table would you use to estimate the value of
these payments when you retire?
1.0
12 The main function of the statement of
stockholders' equity is to
1.0
13 A 12-year bond with a coupon rate of 6% is
issued when the market interest rate for
similar bonds are 8%. In posting the journal
entry for the issuance of the bond the
1.0
14 Hughes Electronics purchased a trading
security on April 1st for $2,000. On April
30th, a decision was made to sell the
trading security for $2,200. What is the
correct journal entry for this transaction?
1.0
15 Which of the following accounts would be
classified as an intangible asset?
1.0
16 The following ladder inventory, purchase,
and sales information are summarized from
the accounting records of a local hardware
store.
If the company uses Average Cost to
account for their inventory, what is the total
value of cost of goods sold?
1.0
Question Notes
Printed on: 3/7/2015

3. Order Name Score Notes
17 An automobile parts dealer sold a set of
tires for a total price of $500 on account.
The terms of the sale are 2/10 net 30. The
proper journal entry to record a payment
within the discount period would debit
1.0
18 On January 1st, Bingham Company
purchased equipment from Harris Company
for $500. After receiving the equipment,
Bingham decided to return the equipment
on January 15th and received full credit for
the refund. What journal entry would Harris
record on January 15th?
1.0
19 The inventory cost flow assumption which
results in ending inventory being valued at
current prices is
1.0
20 A construction company decided to sell a
bulldozer for $175,000. The original cost of
the bulldozer was $200,000 and had
accumulated depreciation of $50,000 on the
books. What is the amount of gain or loss
that the company should recognize at the
time of sale?
1.0
Question Notes
Printed on: 3/7/2015