Devry FIN 382 Week 2 Quiz

Question 1 (TCO 3) Which of the following would not appear on a conventional balance sheet?

• Cash surrender value of life insurance
• Funds from operations
• Patents
• Income taxes payable

Question 2 (TCO 3) Which of the following accounts would not be classified as an intangible?

• Franchises
• Trademarks
• Research and development
• Patents

Question 3 (TCO 3) Which of the following is not a proper use of notes?

• To indicate the basis for asset valuation.
• To describe the nature and effect of a change in accounting principle, such as from FIFO to LIFO.
• To describe a firm’s debt.
• To correct an improper financial statement presentation.

Question 4 (TCO 2) Which of the following would be classified as an extraordinary item on the income statement?

• Loss from prohibition of a product.
• Correction of an error related to a prior period.
• Write-off of obsolete inventory.
• Loss on disposal of a segment of a business.

Question 5 (TCO 3) Which of the following is not considered an intangible asset?

• Prepaid advertising expenses
• Goodwill
• Customer lists
• Memberships

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Question 6 (TCO 3) Which of the following would not be listed as a liability on a company’s balance sheet?

• Taxes payable
• Bonds payable
• Capital lease obligations
• Operating lease obligations

Question 7.(TCO 3) Which of the following would be listed as a liability on a company’s balance sheet?

• Operating lease obligations
• Projected benefit obligation
• Purchase commitment obligation
• Post retirement benefits other than pension obligations

Question 8. (TCO 3) This method of depreciation takes a fraction each year times the cost less salvage value when calculating the

• unit of production method.
• sum of the years digits method.
• declining balance method.
• straight line method.

Question 9 (TCO 2) Smith Company had retained earnings of $60,000 at the end of the current year. For the current year, income was $30,000 and dividends were $10,000. What was the balance in retained earnings at the end of the prior year?

• $20,000
• $40,000
• $60,000
• $50,000

Question 10 (TCO 3) The following relate to Data Original in 2006. What is the ending inventory?

Purchases $540,000
Beginning Inventory 80,000
Purchase Returns 10,000
Sales 800,000
Cost of Goods Sold 490,000

• $140,000
• $210,000
• $120,000
• $160,000