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COMM 217 Final MC Actual Exam Questions and CORRECT Answers
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COMM 217 Final MC Actual Exam Questions and CORRECT Answers Under the accrual basis of accounting, a. cash must be received before revenue is recognized. b. profit is calculated by matching cash outflows against cash inflows. c. events that change a company's financial statements are recogniz...

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  • September 24, 2024
  • 12
  • 2024/2025
  • Exam (elaborations)
  • Questions & answers

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  • comm 217 final mc
  • comm 217 final
  • comm 217

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  • COMM 217
  • COMM 217

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COMM 217 Final MC Actual Exam
Questions and CORRECT Answers
Under the accrual basis of accounting,
a. cash must be received before revenue is recognized.
b. profit is calculated by matching cash outflows against cash inflows.
c. events that change a company's financial statements are recognized in the period they
occur rather than only in the period in which cash is paid or received.
d. the ledger accounts must be adjusted to reflect a cash basis of accounting before
financial statements are prepared under international financial reporting standards. -
CORRECT ANSWER- ✔✔c


The unadjusted balance of Allowance for Doubtful Accounts
a. is relevant when using the Aging of Trade Receivables method to calculate the bad
debt expense.
b. is relevant when credit card sales are made.
c. is relevant when notes receivable are used.

d. will never show a debit balance. - CORRECT ANSWER- ✔✔a


In its first year of operations G Ltd. reported profit before income taxes of $50, 000 on its
income statement. For the same year the tax return showed taxable income of $30,000. The
only reason for this difference was because the company claimed $20,000 more capital cost
allowance (CCA) on its tax return than it recorded as depreciation expense for financial
reporting purposes. The company is subject to an income tax rate of 30%. The journal entry
to record income tax expense for the first year of operations will include
a. A debit to deferred income tax asset, $6,000.
b. A credit to deferred income tax liability, $6,000.
c. A debit to deferred income tax asset, $20,000.

d. A credit to deferred income tax liability, $20,000. - CORRECT ANSWER- ✔✔b


Both the employer and employee must make contributions for:
a. employment insurance premiums.

, b. Canada or Quebec Pension Plan.
c. the employees' income taxes.

d. both a and b. - CORRECT ANSWER- ✔✔d


The Grimaldi Corporation guarantees its products against defects for one year. In what year
should the corporation report the warranty expense?
a. in the year that the product is sold.
b. in the year that the product becomes defective and is repaired or replaced.
c. warranty expense is never recorded because the cost of the warranty is included in the
product's selling price.

d. none of the above. - CORRECT ANSWER- ✔✔a


One feature that is generally not associated with preferred shares is the:
its first year of operations G Ltd. reported profit before income taxes of $50,000 on its
a. cumulative feature b. callable feature c. voting right d. conversion right - CORRECT
ANSWER- ✔✔c


Dubois Ltée. operates in a province where the sales tax is 9%. A customer purchased
merchandise for a cash amount of $500 plus sales tax. The correct journal entry to record this
transaction is:
a. Cash
Sales
b. Cash
Sales
Sales c. Cash
Sales
Sales d. Cash
Sales
tax payable tax payable
500
500
500

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