The purpose of the trial balance is to:
(A)Check the solvency of the company
(B)Identify credits and debits
(C)Analyze the accounting period
(D)Verify that credits equal debits
(E)Find misclassified transactions
Jim's Jeans decided to shut down their Jimmy Jean Division. Where on the income statement would this closing be addressed? Mark one answer:
(A)Under extraordinary items at the bottom of the income statement. (B)As a note on the operating income section of the income statement. (C)Under discontinued operations at the bottom of the income statement. (D)As a deduction in the Net Profit section of the income statement. (E)An entry would be on the operating income section of the income statement.
Correct Answer: C
Cartman's Cats shows the following balances:(C)sh: $20,000(A)counts Receivable: $60,000(I)ventory: $80,000(A)counts Payable: $60,000 Wages Payable : $60,000 What is the quick ratio for the business? Mark one answer:
(A)0.2 : 1 (B)0.4 : 1 (C)0.7 : 1 (D)0.8 : 1 (E)0.6 : 1
Correct Answer: C
If an exempt organization is a corporation, the tax on unrelated business taxable income is
(A)Computed at corporate income tax rates. (B)Computed at rates applicable to trusts. (C)Credited against the tax on recognized capital gains. (D)Abated.
Correct Answer: A
More CPA Exam Questions
- 1Jenny's Bakery recently delivered a bad batch of cakes to a local restaurant. Jenny quickly refunded the cost of the cakes to the restaurant. Her accountant made a _____ to her Refunds of Sales account for this transaction:
- 2In the statement of owner’s equity, owner’s equity or capital is calculated using: Mark one answer:
- 3In AICPA professional standards, the word should indicates an (a)
- 4The controller of a small utility company has interviewed audit firms proposing to perform the annual audit of their employee benefit plan. According to the guidelines of the Department of Labor (DOL), the selected auditor must be
- 5If a corporation issues a 10-year $100,000 8% bond, what is the total that the issuing corporation pays to the bondholder over the next 10 years? Mark one answer: