ACCT 312 DeVry Week 4 Midterm Exam Latest
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<strong>ACCT</strong> <strong>312</strong> <strong>DeVry</strong> <strong>Week</strong> 4 <strong>Midterm</strong> <strong>Exam</strong> <strong>Latest</strong><br />
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<strong>ACCT</strong> <strong>312</strong> <strong>DeVry</strong> <strong>Week</strong> 4 <strong>Midterm</strong> <strong>Exam</strong> <strong>Latest</strong><br />
1. Question : (TCO 1) Which creates a deferred tax liability?<br />
An unrealized loss from recording inventory at lower cost than market.<br />
Estimated warranty expense<br />
Subscriptions collected in advance<br />
Accelerated depreciation in the tax return<br />
Question 2. Question : (TCO 1) Of the following temporary differences, which one ordinarily creates a deferred tax<br />
asset?<br />
Intangible drilling costs<br />
MACRS depreciation<br />
Installment sales<br />
Rent received in advance<br />
Question 3. Question : (TCO 2) Interest cost is calculated by multiplying the<br />
ABO by the expected return on the plan assets.<br />
ABO by the discount rate.<br />
PBO by the expected return on plan assets.<br />
PBO by the discount rate.<br />
Question 4. Question : (TCO 2) Which of the following constitutes the accumulated benefit obligation?<br />
Present value of vested benefits at present pay levels<br />
Present value of nonvested benefits at present pay levels<br />
Present value of additional benefits related to projected pay increases<br />
Present value of both vested and nonvested benefits at present pay levels
Question 5. Question : (TCO 3) According to GAAP, accounting for postretirement benefits other than pensions must<br />
adhere to the<br />
cash basis of accounting.<br />
accrual basis of accounting.<br />
modified accrual basis.<br />
modified cash basis.<br />
Question 6. Question : (TCO 4) Retained earnings represents<br />
earned capital.<br />
cash.<br />
assets.<br />
net assets.<br />
Question 7. Question : (TCO 4) Any dividend that is considered to be a liquidating dividend will<br />
reduce retained earnings.<br />
reduce paid-in capital.<br />
increase paid-in capital.<br />
reduce the common stock account.<br />
Question 8. Question : (TCO 5) The most important accounting objective for executive stock options is<br />
measuring their fair value for balance sheet purposes.<br />
measuring and reporting the amount of compensation expense during the service period.<br />
to disclose increases or decreases in the stock options held at the end of each accounting period.<br />
None of the above<br />
Question 9. Question : (TCO 5) Our company granted options for 2 million shares of its $1 par common stock at the<br />
beginning of the current year. The exercise price is $35 per share, which was also the market value of the stock on the<br />
grant date. The fair value of the options was estimated at $9 per option. If the options have a vesting period of 5 years,<br />
which would be the balance in paid-in-capital stock options three years after the grant date?<br />
A credit of $10.8 million<br />
A credit of $18 million<br />
A debit of $70 million<br />
A debit of $3.6 million<br />
Question 10. Question : (TCO 6) Which of the following is not a potential common stock?<br />
Convertible preferred stock<br />
Convertible bonds
Stock rights<br />
Participating preferred stock<br />
Question 11. Question : (TCO 6) Which of the following results in increasing basic earnings per share?<br />
Paying more than carrying value to retire outstanding bonds<br />
Issuing cumulative preferred stock<br />
Purchasing treasury stock<br />
All of the above<br />
Question 12. Question : (TCO 1) Please describe a deferred tax liability. Also, please provide three examples of timing<br />
differences that result in a deferred tax liability.<br />
Question 13. Question : (TCO 2) Please describe defined-benefit plans. Who bears this risk? What factors contribute<br />
to the amount that the employee receives upon retirement? What are the key elements of a defined-benefit plan?<br />
Question 14. Question : (TCO 4) Differentiate the rights of common shareholders with the rights of preferred<br />
shareholders. Please list at least three rights of each type of stock.<br />
Question 15. Question : (TCO 5) Please describe a stock option plan. What are the key dates? What are some different<br />
ways that these plans can vest?