ACCT 212 Week 5 Quiz

ACCT 212 Week 5 Quiz | Devry University

Question 1

 (CO 6) An example of an intangible asset is  

A.      land.  

B.      equipment.  

C.      coal mine.  

D.      goodwill.

Question 2

 (CO 6) Depreciation expense  

A.      allocates a portion of the cost of an asset against the revenue the asset helps earn each period.  

B.      is not required for plant assets according to GAAP.  

C.      is reported on the balance sheet.  

D.      is required for land according to GAAP.

Question 3

 (CO 6) All of the following are classified as natural resources and are depleted except for  

A.      land.  

B.      timber.  

C.      minerals.  

D.      oil.

Question 4

 (CO 6) A contingent liability for loss should only be disclosed in the notes to financial statements if  

A.      there is a remote possibility of the loss occurring.  

B.      the company has insured it.  

C.      it is probable that the loss will occur and that the amount of the loss can be reasonably estimated.  

D.      it is reasonably possible that the loss will occur.

Question 5

 (CO 6) Which of the following is not necessary to know in computing the future value of an annuity?  

A.      Amount of the initial payment  

B.      Interest rate  

C.      Length of time between investment and payment 

D.      Year the payments begin

E.       See Appendix F.

Question 6

 (CO 6) All of the following are reported as current liabilities except  

A.      bonds payable.  

B.      sales tax payable.  

C.      accounts payable.  

D.      unearned revenues.

Question 7

 (CO 6) Failure to record an accrued liability causes a company to  

A.      overstate income.  

B.      overstate assets.  

C.      understate liabilities.  

D.      understate owners' equity.

Question 8

 (CO 6) If bonds are issued at a discount, it means that the  

A.      market interest rate is higher than the stated interest rate. 

B.      market interest rate is lower than the stated interest rate.  

C.      financial strength of the issuer is weak.  

D.      bond is convertible.

Question 9

 (CO 6) Bonds that mature at a single specified future date are called  

A.      term bonds.  

B.      coupon bonds.  

C.      serial bonds.  

D.      debentures.

Question 10

 (CO 6) The financing option that creates no liabilities or interest expense is financing by  

A.      issuing notes payable.  

B.      debt.  

C.      issuing stock.  

D.      issuing bonds payable.