ACC 290 Final Exam Part 2
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1. Financial information is presented below:
Operating expenses $36,000
Sales revenue 150,000
Cost of goods sold 105,000
2.
Gross profit would be
3. At December 31, 2014 Mohling Company’s inventory records indicated a balance of $602,000. Upon further
investigation it was determined that this amount included the following:
? $112,000 in inventory purchases made by Mohling shipped from the seller 12/27/14 terms FOB destination, but not due
to be received until January 2nd
? $74,000 in goods sold by Mohling with terms FOB destination on December 27th. The goods are not expected to reach
their destination until January 6th
? $6,000 of goods received on consignment from Dollywood Company
What is Mohling’s correct ending inventory balance at December 31, 2014?
4. Olympus Climbers Company has the following inventory data:
July 1 Beginning inventory 20 units at $19 $380
7 Purchases 70 units at $20 1,400
22 Purchases 10 units at $22 220
$2,000
A physical count of merchandise inventory on July 30 reveals that there are 32 units on hand. Using the FIFO inventory
method, the amount allocated to cost of goods sold for July is
5. Jenks Company developed the following information about its inventories in applying the lower of cost or market
(LCM) basis in valuing inventories:
Product Cost Market
A $57,000 $60,000
B 40,000 38,000
C 80,000 81,000
If Jenks applies the LCM basis, the value of the inventory reported on the balance sheet would be
6. Nilson Company gathered the following reconciling information in preparing its August bank reconciliation:
Cash balance per books, 8/31 $21,000
Deposits in transit 900
Notes receivable and interest collected by bank 5,100
Bank charge for check printing 120
Outstanding checks 12,000
NSF check 1,020
The adjusted cash balance per books on August 31 is
7. Which of the following is not a basic principle of cash management?
8. Use the following data to determine the total dollar amount of assets to be classified as property, plant, and
equipment.
Eddy Auto Supplies
Balance Sheet
December 31, 2014
Cash $84,000 Accounts payable $110,000
Accounts receivable 80,000 Salaries and wages payable 20,000
Inventory 140,000 Mortgage payable 180,000
Prepaid insurance 60,000 Total liabilities $310,000
Stock Investments 170,000
Land 190,000

Buildings $226,000 Common stock $240,000
Less: Accumulated depreciation (40,000) 186,000 Retained earnings 500,000
Trademarks 140,000 Total stockholders' equity $740,000
Total assets $1,050,000 Total liabilities and stockholders' equity $1,050,000
9. Accounting information is relevant to business decisions because it
10. Howard Company had a transaction that caused a $5,000 increase in both assets and total liabilities. This transaction
could have been a(n)
11. Can financial statements be prepared directly from the adjusted trial balance?