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M.A.T.C.Accounting1 – Test5 Extra Credit– 25 Questions(Chapter1– 10)
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M.A.T.C Accounting 1 – Test 4 – December 201...
M.A.T.C.Accounting1 – Test5 Extra Credit– 25 Questions(Chapter1– 10)
Page - 2
M.A.T.C Accounting 1 – Test 4 – December 201...
M.A.T.C.Accounting1 – Test5 Extra Credit– 25 Questions(Chapter1– 10)
Page - 3
M.A.T.C Accounting 1 – Test 4 – December 201...
M.A.T.C.Accounting1 – Test5 Extra Credit– 25 Questions(Chapter1– 10)
Page - 4
M.A.T.C Accounting 1 – Test 4 – December 201...
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Test 5 Extra Credit

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Accounting 1 Test 5 Extra Credit

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Test 5 Extra Credit

  1. 1. M.A.T.C.Accounting1 – Test5 Extra Credit– 25 Questions(Chapter1– 10) Page - 1 M.A.T.C Accounting 1 – Test 4 – December 2015 1. Accounting is an information and measurement system that identifies, records, and communicates relevant, reliable, and comparable information about an organization's business activities. True False 2. An accounting information system communicates data to help users make better decisions. True False 3. Financial accounting is the area of accounting that provides internal reports to assist the decision making needs of internal users. True False 4. External auditors examine financial statements to verify that they are prepared according to generally accepted accounting principles. True False 5. External users include lenders, shareholders, customers, and regulators. True False 6. Describe the key attributes of inventory for a merchandising company. Narrative Answer: ________________________________________________________________________________ ________________________________________________________________________________ _______________________________________________________________________________ _______________________________________________________________________________ _______________________________________________________________________________ _______________________________________________________________________________ 7. Decision makers in practice do not need a basic knowledge of how accounting information systems work because they can be relied upon to be accurate. True False 8. Control, competency, compatibility, flexibility and cost-benefit are the five basic principles of accounting information systems. True False
  2. 2. M.A.T.C.Accounting1 – Test5 Extra Credit– 25 Questions(Chapter1– 10) Page - 2 M.A.T.C Accounting 1 – Test 4 – December 2015 9. Which of the following statements regarding accounting information systems is not true? A. Accounting information systems collect and process data from transactions and events. B. Accounting information systems organize data in useful forms. C. Accounting information systems are not subject to internal control policies. D. Accounting information systems are useful to effective decision making. E. Accounting information systems communicate information to business decision makers. 10. A receivable is an amount due from another party. True False 11. Credit sales are recorded by crediting an Accounts Receivable. True False 12. As long as a company accurately records total credit sales information, it is not necessary to have separate accounts for specific customers. True False 13. If a customer owes interest on accounts receivable, Interest Receivable is debited and Accounts Receivable is credited. True False 14. If a credit card sale is made, the seller can either debit Cash or debit Accounts Receivable at the time of the sale, depending on the type of credit card. True False 15. Installment Accounts Receivable are classified as non-current assets if the installment period is more than one year, even if the seller regularly offers customers such terms. True False 16. Companies can report credit card expense as a discount deducted from sales or as a selling expense. True False 17. BizCom's customer, Redding, paid off an $8,300 balance on its account receivable. BizCom should record the transaction as a debit to Accounts Receivable—Redding and a credit to Cash. True False
  3. 3. M.A.T.C.Accounting1 – Test5 Extra Credit– 25 Questions(Chapter1– 10) Page - 3 M.A.T.C Accounting 1 – Test 4 – December 2015 18. The maturity date of a note refers to the date the note must be repaid. True False 19. Separate accounts receivable information for each customer is important because it reveals all of the following except: A. How much each customer has purchased on credit. B. How much each customer has paid. C. How much each customer still owes. D. The basis for sending bills to customers. E. When the customer intends to pay outstanding balances. 20. The accounts receivable turnover is calculated by: A. Dividing net sales by average accounts receivable. B. Dividing net sales by average accounts receivable and multiplying by 365. C. Dividing average accounts receivable by net sales. D. Dividing average accounts receivable by net sales and multiplying by 365. E. Dividing net income by average accounts receivable. 21. A method of estimating bad debts expense that involves a detailed examination of outstanding accounts and the length of time past due is the: A. Direct write-off method. B. Aging of accounts receivable method. C. Percentage of sales method. D. Aging of investments method. E. Percent of accounts receivable method.
  4. 4. M.A.T.C.Accounting1 – Test5 Extra Credit– 25 Questions(Chapter1– 10) Page - 4 M.A.T.C Accounting 1 – Test 4 – December 2015 22. Honoring a note receivable indicates that the maker has: A. Signed. B. Paid in full. C. Guaranteed. D. Notarized. E. Cosigned. 23. Plant assets refer to nonphysical assets that are used in the operations of a business. True False 24. Plant assets are used in operations and have useful lives that extend over more than one accounting period. True False 25. If land is purchased as a building site, the cost of removing existing structures is not charged to the Land account. True False

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