Acct 557 quizzes week 1 to 8 intermediate accounting iii

ACCT 557 Quizzes Week 1 to 8 Intermediate Accounting III

Week 1

Week 1 Quiz

1. Question : (TCO A) Platypus Building Inc. won a bid for a new office building contract. Below is info from the project accountant:

1. Question :           (TCO A) Kerry Corp purchased a used bottling machine from Bob’s Bottling Inc. on Jan 1, 2012 for $2100000.  Bob accounted for the sale correctly under the installment sales method.  It had a book value of $1575000.  Kerry paid with $300000 cash and a note for $1800000 with an annual interest of 10%.  Kerry agreed to make equal annual payments of $600000.  Kerry Corp made their first payment on Jan 1, 2013 of $780000 which included interest of $180000 to date of payment.

1. Question :           (TCO A) Blue Suede Construction Corp used the percentage-of-completion method of revenue recognition. They were contracted to build the new amphitheater for $4500000.  Additional information was provided:

1. Question :           (TCO A) Revenue is NOT recognized at the time of sale when…

Week 2

Week 2 Quiz

1. Question : (TCO B)  As a result of differences between depreciation for financial reporting purposes and tax purposes, the financial reporting basis of Noor Co.’s sole depreciable asset, acquired in Year 1, exceeded its tax basis by $250,000 at December 31, Year 1.  This difference will reverse in future years.  The enacted tax rate is 30% for Year 1, and 40% for future years.  Noor has no other temporary differences.  In its December 31, Year 1, balance sheet, how should Noor report the deferred tax effect of this difference?

Question 2.         Question :           (TCO B)  Mobe Co. reported the following operating income (loss) for its first three years of operations:

Question 3.         Question :           (TCO B) Hut Co. has temporary taxable differences that will reverse during the next year and add to taxable income.  These differences relate to noncurrent assets.  Under U.S. GAAP, deferred income taxes based on these temporary differences should be classified in Hut’s balance sheet as a:

Question 4.         Question :           (TCO B) Venus Corp.’s worksheet for calculating current and deferred income taxes for Year 1 follows:

Question 5.         Question :           (TCO B) Stone Co. began operations in Year 1 and reported $225,000 in income before income taxes for the year.  Stone’s Year 1 tax depreciation exceeded its book depreciation by $25,000.  Stone also had nondeductible book expenses of $10,000 related to permanent differences.  Stone’s tax rate for Year 1 was 40%, and the enacted rate for years after Year 1 is 35%.  In its December 31, Year 1, balance sheet, what amount of deferred income tax liability should Stone report?

Week 3

Week 3 Quiz

ACCT 557 Week 3 Quiz 1

Question 1.                         (TCO C) Presented below is pension information related to Woods, Inc. for the year 2013.

Question 2.                         (TCO C) A pension asset is reported when

Question 3.                         (TCO C) Post-retirement benefits may include all of the following except

Question 4.                         (TCO C) Kathy’s Kittens, Inc. has provided the following information for their post-retirement benefits plan for 2013.    

Question 5.                         (TCO C) On January 1, 2013, Laura’s Living Company has the following defined benefit pension plan balances.

Question 6.                         (TCO C) Kasper, Inc. sponsors a defined-benefit pension plan. The following data relates to the operation of the plan for the year 2013.           

ACCT 557 Week 3 Quiz 2

1. Question : (TCO B) Zeff Co. prepared the following reconciliation of its pretax financial statement income to taxable income for the year ended December 31, Year 1, its first year of operations:
2. Question :           (TCO B) On its December 31, Year 2, balance sheet, Shin Co. had income taxes payable of $13,000 and a current deferred tax asset of $20,000 before determining the need for a valuation account.  Shin had reported a current deferred tax asset of $15,000 at December 31, Year 1.  No estimated tax payments were made during Year 2.  At December 31, Year 2, Shin determined that it was more likely than not that 10% of the deferred tax asset would not be realized.  In its Year 2 income statement, what amount should Shin report as total income tax expense?

1. Question :           (TCO B) Hut Co. has temporary taxable differences that will reverse during the next year and add to taxable income.  These differences relate to noncurrent assets.  Under U.S. GAAP, deferred income taxes based on these temporary differences should be classified in Hut’s balance sheet as a:

1. Question :           (TCO B) For the year ended December 31, 1993, Grim Co.’s pretax financial statement income was $200,000 and its taxable income was $150,000.  The difference is due to the following:

1. Question : (TCO B) Stone Co. began operations in Year 1 and reported $225,000 in income before income taxes for the year.  Stone’s Year 1 tax depreciation exceeded its book depreciation by $25,000.  Stone also had nondeductible book expenses of $10,000 related to permanent differences.  Stone’s tax rate for Year 1 was 40%, and the enacted rate for years after Year 1 is 35%.  In its December 31, Year 1, balance sheet, what amount of deferred income tax liability should Stone report?

ACCT 557 Week 3 Quiz 3

1. Question : (TCO C) Presented below is pension information related to Woods, Inc. for the year 2013.       

1. Question :           (TCO C) A pension liability is reported when
2. Question :           (TCO C) Post-retirement benefits may include all of the following except

1. Question :           (TCO C) Kathy’s Kittens, Inc. has provided the following info for their postretirement benefits plan for 2013.           

1. Question :           (TCO C) On January 1, 2013, Laura’s Living Company has the following defined benefit pension plan balances.

1. Question :           (TCO C) Kasper, Inc. sponsors a defined-benefit pension plan. The following data relates to the operation of the plan for the year 2013.           

Week 4

Week 4 Quiz

Week 4 Quiz 1

Week 4 Quiz 2

Week 5

Week 5 Quiz

1. Question : (TCO D) Lease methods of accounting are

1. Question :           (TCO D) A major purpose(s) in starting an equipment leasing company is (are)

1. Question :           (TCO D) Pirate, Inc. leased equipment from Shoreline Enterprises under a four-year lease requiring equal annual payments of $425,000, with the first payment due at lease inception. The lease does not transfer ownership, nor is there a bargain purchase option. The equipment has a 4-year useful life and no salvage value. Pirate, Inc.’s incremental borrowing rate is 10% and the rate implicit in the lease (which is known by Pisa, Inc.) is 8%. Assuming that this lease is properly classified as a capital lease, what is the amount of interest expense recorded by Pirate, Inc. in the first year of the asset’s life?
2. Question :           (TCO D) On January 2, 2013, Bentley Co. leases equipment from Harry’s Leasing Company with five equal annual payments of $240000 each, payable beginning December 31, 2013. Bentley Co. agrees to guarantee the $20000 residual value of the asset at the end of the lease term. Bentley’s incremental borrowing rate is 10%, however it knows that Harry’s implicit interest rate is 8%. What journal entry would Harry’s Leasing Company make at January 2, 2013 assuming this is a direct–financing lease?
3. Question :           (TCO D) Lease A does not contain a bargain purchase option, but the lease term is equal to 90% of the estimated economic life of the leased property. Lease B does not transfer ownership of the property to the lessee by the end of the lease term, but the lease term is equal to 75% of the estimated economic life of the leased property. How should the lessee classify these leases?

1. Question :           (TCO D) Carl Leasing, Inc. agrees to lease medical equipment to Sally, Inc. on January 1, 2012. They agree on the following terms.           

ACCT 557 Week 5 Quiz 2

1. Question : (TCO D) Lease methods of accounting are
2. Question :           (TCO D) Current GAAP requires
3. Question :           (TCO D) Pirate, Inc. leased equipment from Shoreline Enterprises under a four-year lease requiring equal annual payments of $320,000, with the first payment due at lease inception. The lease does not transfer ownership, nor is there a bargain purchase option. The equipment has a 4-year useful life and no salvage value. Pirate, Inc.’s incremental borrowing rate is 10% and the rate implicit in the lease (which is known by Pisa, Inc.) is 8%. Assuming that this lease is properly classified as a capital lease, what is the amount of interest expense recorded by Pirate, Inc. in the first year of the asset’s life?                                      
4. Question :           (TCO D) On January 2, 2013, Bentley Co. leases equipment from Harry’s Leasing Company with five equal annual payments of $240000 each, payable beginning December 31, 2013. Bentley Co. agrees to guarantee the $20000 residual value of the asset at the end of the lease term. Bentley’s incremental borrowing rate is 10%, however it knows that Harry’s implicit interest rate is 8%. What journal entry would Harry’s Leasing Company make at January 2, 2013 assuming this is a direct–financing lease?
5. Question :           (TCO D) Lease A does not contain a bargain purchase option, but the lease term is equal to 90% of the estimated economic life of the leased property. Lease B does not transfer ownership of the property to the lessee by the end of the lease term, but the lease term is equal to 75% of the estimated economic life of the leased property. How should the lessee classify these leases?
6. Question :           (TCO D) Carl Leasing, Inc. agrees to lease medical equipment to Sally, Inc. on January 1, 2012. They agree on the following terms.         

Week 6

Week 6 Quiz

1. (TCO F) What is the primary purpose of the statement of cash flows? (Points : 5)

1. (TCO F) Which of the following is not true? (Points : 5)

Companies classify some cash transactions relating to investing or financing activities as operating activities.

1. (TCO F) Glitter Girl, Inc. recognized net income of $136,000 including $24,000 in depreciation expense.

1. (TCO F) Pig Builder’s, Inc. shows the following as of December 31, 2012.

Acquired 50% of Wolf Corp’s common stock for $160,000 cash, which was borrowed from Granny’s Bank.        

1. (TCO F) Pig Builder’s, Inc. shows the following as of December 31, 2012.

Acquired 50% of Wolf Corp’s common stock for $160,000 cash which was borrowed from Granny’s Bank.        Issued 5,000 shares of its preferred stock for land having a fair value of $320,000       

1. (TCO F) Cash flows from operating activities (indirect and direct methods).

Presented below is the income statement of Smiling Tiger, Inc.

Week 7

Week 7 Quiz

1. Question : (TCO F) The company uses the indirect method for the statement of cash flow. How would an increase in the inventory balance be reported?

1.           Question :           (TCO F) Which of the following is not true?

1. Question :           (TCO F) Glitter Girl, Inc. recognized net income of $136,000 including $24,000 in depreciation expense.       

1. Question :           (TCO F) Dasher Builder’s, Inc. shows the following as of December 31, 2012.                 

1. Question :           (TCO F) Big Dog Builder’s, Inc. shows the following as of December 31, 2012.                

1. Question :           (TCO F) Cash flows from operating activities (indirect and direct methods).

Presented below is the income statement of Smiling Tiger, Inc.

Week 8

Week  8 Quiz