CLEP Financial Accounting: Study Guide & Test Prep Final Exam

Free Practice Test Instructions:

Choose your answer to the question and click 'Continue' to see how you did. Then click 'Next Question' to answer the next question. When you have completed the free practice test, click 'View Results' to see your results. Good luck!

Question 1 1. An antiques dealer would most likely use which method for inventory valuation and cost of goods sold?

Question 2 2. A machine is purchased for $10,000. It has an estimated life of five years and 2,000 machine hours with no residual value. It will be depreciated by the units of production method. How much is the depreciation for year 1 when it runs for 500 hours?

Question 3 3. In a period of rising prices, which of the following methods results in the highest inventory valuation?

Question 4 4. An increase in which of these items will also cause an increase in equity?

Question 5 5. Suppose sales = $10,000, beginning inventory = $2,000, purchases = $3,000, end inventory = $1,500 and operating expenses are $2,000. How much is net income?

Question 6 6. Which of the following equals the total equity of a company?

Question 7 7. How would depreciation expense be shown when using the indirect method for the statement of cash flows?

Question 8 8. What is the term for entries that reduce revenues, expenses, and dividends to zero for the next accounting period?

Question 9 9. A company signs a $5,000 note on Jan 1. If the interest rate is 5%, what is the accrued interest on March 31?

Question 10 10. Jones company issues $10,000,000 of bonds on Jan 1, and the cash proceeds are $9,500,000. Which of the following is true about the bonds?

Question 11 11. Which ratio determines how quickly a form collects cash on its credit sales?

Question 12 12. Smith Co has 20,000 shares authorized and 15,000 issued. 1,000 shares are treasury stock. If a $1.00 per share dividend is declared, how much is the total cash dividend?

Question 13 13. A company buys a patent that is good for 17 years for $150,000. The remaining legal life is 8 years and the company believes it's useful life will be 5 years. How much of the assets price is expensed in year 1?

Question 14 14. Which of the following statements offers the BEST explanation of contingent liabilities?

Question 15 15. Bob is an investor. Bob knows Steve who is the CEO of XYZ Technologies. Steve is offering to sell Bob a bond worth $50,000. The sales price of the bond is $60,000. The bond will have coupon interest payments of $7,000 for 10 years until it reaches maturity. If Bob purchased this bond, what would he be doing?

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CLEP Financial Accounting: Study Guide & Test Prep Final Free Practice Test Instructions

Choose your answer to the question and click 'Continue' to see how you did. Then click 'Next Question' to answer the next question. When you have completed the free practice test, click 'View Results' to see your results. Good luck!

CLEP Financial Accounting: Study Guide & Test Prep  /  CLEP Courses
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