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C213 Final Accounting Exam QUESTIONS AND CORRECT DETAILED ANSWERS GRADED A+ 2024
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C213 Final Accounting Exam QUESTIONS AND CORRECT DETAILED ANSWERS GRADED A+ 2024
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C213 Final Accounting Exam QUESTIONS AND CORRECT DETAILEDANSWERS GRADED A+ 2024
RATED
1. Which of the following activities would internal auditors NOT typically
perform in a large company?: Detect fraud
Evaluate internal controls
*Prepare the primary financial statements
Assist with increasing the efficiency of operation
2. Correct Answer: $3,800
Beginning cash balance:
x + $309,800 - $118,000 - $190,000 = $5,600
x = $3,800: The following financial information is available for the year 2012:
Operating activities
$ 309,800
Investing activities
($118,000)
Financing activities
($190,000)
Ending cash balance
,$ 5,600
Given this information, what is the beginning cash balance?
3. Net Income: What is typically viewed as the fundamental measure of a compa-
ny's profitability, but there are also a variety of other measures of "income." The
best measure of sustainable profitability is income from continuing operations.
4. What are the three primary categories of an Income Statement?: The pri-
mary categories of income statement items are revenues, expenses, gains, and
losses.
5. Income from continuing operations and extraordinary items: Income state-
ment items that do not relate to a company's continuing operations are income
from what?
6. Multi-step Income Statement: When revenue and expense items are arranged
to highlight important profit relationships, the resulting income statement format is
called a?
7. The Matching Concept: Revenue should be recognized when value has been
delivered to customers which is typically only after the required work has been
performed and after the collection of cash is reasonably assured. What method is
used to decide when to recognize expenses?
,8. Assets = Liabilities + Paid-in Capital + (Revenues - Expenses - Dividends)-
: Individual transactions impacting income can be analyzed using the expanded
accounting equation, which is:
9. Forecast income for future periods.: What is an important use of an income
statement? It requires an understanding of what underlying factors determine the
level of a revenue or an expense.
10. Accrual Accounting: What is the process that accountants use in adjusting
raw transaction data into refined measures of a firm's economic performance?
11. Financial Capital Maintenance: A concept that states that income exists
when the dollar amount of a company's net assets (assets - liabilities, or owners'
equity) increases during the year, after excluding the effects of new owner invest-
ment or payment of dividends to owners. What is this approach called?
12. Gross Profit: What equals sales revenues minus the cost of goods sold. This
is the money you take in from selling goods and how much those good cost you to
make.
13. Net Profit: What is equal to gross profit minus fixed costs. Start with gross
profit and subtract fixed costs (rent, salaries, taxes, utilities, fees, amortization,
depreciation
14. Gross profit is an important number. If a company is not generating
enough from the sale of a product or service to cover the costs directly
associated with that product or service, that company will not be able to stay
in that line of business for long.: Why is Gross Profit an important number?
15. Operating Income: What measures the performance of the fundamental busi-
ness operations conducted by a company and is computed as gross profit minus
operating expenses?
16. Operating income tells users how well a business is performing in the
activities unique to that business, separate from the financing and income
, tax management policies that are handled at the corporate headquarters
level.: What does Operating Income tell a business?
17. Provides interested parties with information that can be used to predict
how a company will perform in the future.: What is a key purpose of financial
accounting?
18. Income from Continuing Operations: What is a desired income number that
reflects the aspects of a company's performance that is expected to continue into
the future?
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