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CLEP - Financial Accounting 1-2 Exam Questions and Complete Solutions Graded A+
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CLEP - Financial Accounting 1-2 Exam Questions and Complete Solutions Graded A+
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CLEP - FinancialAccounting 1-2 Exam
Questions and Complete
Solutions Graded A+
Denning [Date] [Course title]
, The lower of cost or market (LCM) is an application of - Answer: Conservatism
Falcon, Inc., a manufacturer and supplier of kitchen appliances, provides a two-year warranty on
component parts at no cost. Which accounting principle requires Falcon to recognize as an expense the
estimated cost of fulfilling a warranty in the year the equipment is sold? - Answer: Matching Principle
(1) Adjusted trial balance is prepared.
(2) Transactions are posted to ledgers.
(3) Transactions are recorded in a journal.
(4) Closing entries are made.
(5) Adjusting journal entries are made.
(6) Trial balance is prepared.
(7) Financial statements are prepared.
Each of the principal steps in the accounting cycle is identified above by a number. Which response lists
the correct sequence of events in the accounting cycle? - Answer: 3, 2, 6, 5, 1, 7, 4
The Accumulated Depreciation account should be shown in the financial statements as - Answer: a
contra (deduction) to an asset account
Which of the following will be credited when recording an accrued expense? - Answer: A liability
account
In a limited partnership, limited partners are at risk for - Answer: The amount of their investment in the
partnership
The owner of a small business paid the property taxes on her personal residence from the business
checking account. The payment should be charged to which of the following? - Answer: Withdrawals
As it pertains to GAAP Standardization, the governing body that always enforces GAAP in the United
States is called: - Answer: FASB
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