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    ACC 211 - Review 2 (Chapters 5, 6, & 7)

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    Brennan Patrick Wynn
    This document contains a review for ACC 211 that includes 21 multiple choice questions testing accounting concepts related to financial statements, inventory methods, internal controls, and bank reconciliations. It provides information to calculate inventory values and costs of goods sold using different inventory methods like FIFO, LIFO, and average cost. It also includes a bank reconciliation problem requiring journal entries to adjust the cash balances. The review tests fundamental accounting principles and calculations.

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    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd

    ACC 211 - Review 2 (Chapters 5, 6, & 7)

    Uploaded by

    Brennan Patrick Wynn
    268 views4 pages
    This document contains a review for ACC 211 that includes 21 multiple choice questions testing accounting concepts related to financial statements, inventory methods, internal controls, and bank reconciliations. It provides information to calculate inventory values and costs of goods sold using different inventory methods like FIFO, LIFO, and average cost. It also includes a bank reconciliation problem requiring journal entries to adjust the cash balances. The review tests fundamental accounting principles and calculations.

    Original Description:

    review 2

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    This document contains a review for ACC 211 that includes 21 multiple choice questions testing accounting concepts related to financial statements, inventory methods, internal controls, and bank reconciliations. It provides information to calculate inventory values and costs of goods sold using different inventory methods like FIFO, LIFO, and average cost. It also includes a bank reconciliation problem requiring journal entries to adjust the cash balances. The review tests fundamental accounting principles and calculations.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    268 views4 pages

    ACC 211 - Review 2 (Chapters 5, 6, & 7)

    Uploaded by

    Brennan Patrick Wynn
    This document contains a review for ACC 211 that includes 21 multiple choice questions testing accounting concepts related to financial statements, inventory methods, internal controls, and bank reconciliations. It provides information to calculate inventory values and costs of goods sold using different inventory methods like FIFO, LIFO, and average cost. It also includes a bank reconciliation problem requiring journal entries to adjust the cash balances. The review tests fundamental accounting principles and calculations.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Download as docx, pdf, or txt
    of 4
    At a glance
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    The document discusses accounting concepts related to inventory costing methods, bank reconciliations, and petty cash funds. Specifically, it covers FIFO, LIFO, average costing and explains how to calculate cost of goods sold and ending inventory using each method. It also discusses the process of preparing a bank reconciliation and the necessary journal entries.

    There are several inventory costing methods discussed - FIFO (first in, first out), LIFO (last in, first out), and average costing. Each method calculates the cost of goods sold and ending inventory differently based on the cost of the earliest, latest or average purchases respectively.

    A bank reconciliation is prepared to ensure the bank balance per the company's records matches the bank statement. It involves identifying and adjusting for any deposits/withdrawals that have been made but not recorded by either party to determine the correct adjusted cash balance.

    ACC 211

    Review#2

    NAME:_______________________

    1. What is the normal balance of the Sales account and on which financial statement is it reported?
    a. debit; balance sheet
    c. debit; income statement
    b. credit; balance sheet
    d. credit; income statement
    2. If the purchaser is responsible for paying the transportation costs, the terms are said to be
    a. FOB destination
    c. FOB shipping point
    b. FOB delivery
    d. FOB upon arrival
    3. If merchandise is sold on account to a customer for $15,000, terms FOB shipping point, 1/10,
    n/30, and the seller pays $50 in transportation costs, the amount of the discount for early
    payment would be?
    a. $0
    c. $150.00
    b. $50.00
    d. $200.00
    4. Which of the following accounts would be closed to Income Summary by debiting the account
    at the end of the fiscal year?
    a. Cost of Goods Sold
    c. Delivery Expense
    b. Sales Returns and Allowances
    d. Interest Revenue
    5. How is Gross Profit calculated?
    a. Cost of Goods Sold-Operating Expenses
    b. Net Sales Operating Expenses

    c. Net Sales Cost of Goods Sold


    d. Net Sales + Cost of Goods Sold

    6. Which of the following accounts would not be included on a multi-step income statement?
    a. Cost of Merchandise Sold
    c. Sales Discounts
    b. Merchandise Inventory
    d. Sales
    7. What type of account and on which financial statement is inventory reported?
    a. Asset on the Balance Sheet
    b. Liability on the Balance Sheet
    c. Asset on the Income Statement
    d. Expense on the Income Statement
    8. If a company uses the perpetual inventory method, the journal entry to record the cost of
    inventory sold includes?
    a. a debit to Cost of Merchandise Sold; a credit to Cash
    b. a debit to Cost of Merchandise Sold; a credit to Merchandise Inventory
    c. a debit to Merchandise Inventory; a credit to Cash
    d. a debit to Merchandise Inventory; a credit to Cost of Merchandise Sold
    9. Office salaries, depreciation of office equipment, and office supplies would all be reported under
    which header on a multi-step income statement?
    a. Administrative Expenses
    c. Other Expenses
    b. Miscellaneous Expenses
    d. Selling Expenses

    10. The inventory costing method that is based on the assumption that costs should be charged to
    Cost of Merchandise Sold in the order in which they were purchased is:
    a. average cost
    c. LIFO
    b. FIFO
    d. specific identification
    11. A credit balance in the Cash Over & Short account at the end of the accounting period is
    reported as?
    a. expense on the income statement
    c. an asset on the balance sheet
    b. revenue on the income statement
    d . a liability on the balance sheet
    12. Which one of the following is not an objective of a system of internal controls?
    a. Safeguard company assets
    b. Regulate the amount of authority a supervisor exercises over a subordinate.
    c. Enhance the accuracy and reliability of accounting records
    d. Compliance with laws and regulations.
    13. Which of the following in a cash drawer at November 30 is not cash?
    a. Money orders
    b. Coins and currency
    c. A customer check dated December 1
    d. A customer check dated November 27
    14. In preparing a bank reconciliation, the amount of deposits in transit would be:
    a. a deduction from the balance per depositors records
    b. an addition to the balance per depositors records
    c. a deduction from the balance per bank statement
    d. an addition to the balance per bank statement
    15. Accompanying the bank statement was a debit memorandum for bank service charges. On the
    bank reconciliation, the items is
    a. a deduction from the balance per depositors records
    b. an addition to the balance per bank statement
    c. a deduction from the balance per bank statement
    d. an addition to the balance per depositors records

    c.
    d.

    16. Journal entries based on the bank reconciliation are required for
    a. additions to the cash balance according to the depositors records
    b. deductions from the cash balance according to the depositors records
    both A and B
    neither A nor B
    17. Which of the following is correct entry to replenish a petty cash fund?
    a. Debit Petty Cash; credit Cash
    b. Debit various expense accounts; credit Petty Cash
    c. Debit various expense accounts; credit Cash
    d. Debit Cash; credit Petty Cash

    18. If a company using the LIFO inventory costing method sells 20 units, compute the value of the
    ending inventory and the cost of the merchandise sold.
    Goods Available for Sale:
    6/1 Beginning Inventory: 10 units @ $15
    6/15 Purchase
    15 units @ $20
    6/27 Purchase
    12 units @ $25

    Cost of Merchandise Sold

    Ending Inventory:

    19. If a company using the FIFO inventory costing method sells 20 units, compute the value of the
    ending inventory and the cost of the merchandise sold.
    Goods Available for Sale:
    6/1 Beginning Inventory: 10 units @ $15
    6/15 Purchase
    15 units @ $20
    6/27 Purchase
    12 units @ $25

    Cost of Merchandise Sold:

    Ending Inventory:

    20. If a company using the average inventory costing method sells 20 units, compute the value of
    the ending inventory and the cost of the merchandise sold (round to two decimal places).
    Goods Available for Sale:
    6/1 Beginning Inventory: 10 units @ $15
    6/15 Purchase
    15 units @ $20
    6/27 Purchase
    12 units @ $25

    Cost of Merchandise Sold

    Ending Inventory:

    21. The following information pertains to Family Video Company.


    Cash balance per bank, July 31, $9,442.

    July bank service charge, $36.

    Cash balance per books, July 31, $9,469.

    Deposits in transit, July 31, $1,950.

    Bank collected $1,170 note for Family Video Company in July, plus interest $47, less fee
    $26. The collection has not been recorded by Family Video Co.

    Outstanding checks, July 31, $768.

    $
    Cash balance per bank statement
    Add:

    Cash balance per depositor's re


    Add:

    Deduct
    :

    Deduct
    :

    Adjusted Balance

    Adjusted Balance

    Journal Entries:

    Dr.

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