Introduction to Financial Accounting Coursera Quiz Answers

All Weeks Introduction to Financial Accounting Coursera Quiz Answers

Introduction to Financial Accounting Week 1 Quiz Answers

Quiz 1: Homework #1

Q1. Which of the following is a required financial statement?

• Statement of Assets and Liabilities
• Statement of Tangible Equity
• Statement of Cash Flows
• Statement of Revenues and Expenditures
• Statement of Auditor Independence

Q2. Which of the following is an asset? (check all that apply)

• Notes Payable
• Common Stock
• Prepaid Rent
• Cash
• Retained Earnings

Q3. What are Ending Retained Earnings in the table below?

Total Assets	300
Total Liabilities	120
Total Stockholder’s Equity
Beginning Retained Earnings	30
Ending Retained Earnings	?
Dividends	10
Revenues	190
Expenses	140
Net Income
Cash	50

• 70
• 20
• Not enough information
• 50
• -20

Q4. Which of the following transactions violates the balance sheet equation? (check all that apply)

• Increase cash and reduce inventory (a non-cash asset)
• Increase revenues and reduce a liability
• Reduce cash and reduce a liability
• Increase cash and increase an expense
• Increase cash and reduce a liability

Q5. Which of the following are assets? (check all that apply)

• Accounts Receivable
• Cash
• Accounts Payable
• Retained Earnings
• Common Stock

Q6. Which of the following accounts would be increased with a Debit? (check all that apply)

• Prepaid Insurance
• Advertising Expense
• Land
• Accounts Payable
• Cash

Q7. Which of these journal entries represent paying cash to reduce a liability? (check all that apply)

• Dr.  Land           100
•     Cr.  Cash           100
• Dr.  Cash               300
•      Cr.  Accounts Payable     300
• Dr. Retained Earnings     500
•      Cr.  Cash                         500
• Dr. Income Taxes Payable       500
•     Cr.      Cash                                  500
• Dr. Cash                   1000
•     Cr.   Notes Payable          1000

Q8. Which journal entry reflects the following transaction?:

BOC sold 10,000 shares of $1 par value stock to investors for $5 per share.

• Dr.  Cash                      10,000
•      Cr.  Common Stock                 10,000
• Dr.  Cash                      50,000
•      Cr.  Common Stock                 10,000
•      Cr.  Additional Paid-in Capital   40,000
• Dr. Common Stock                 10,000
• Dr. Additional Paid-in Capital     40,000
•      Cr.   Cash                                  50,000
• Dr.  Cash                      50,000
•      Cr.  Common Stock                 40,000
•      Cr.  Additional Paid-in Capital   10,000
• Dr.  Cash                      50,000
•      Cr.  Common Stock          50,000

Q9. Which journal entry reflects the following transaction?:

BOC bought $10,000 of inventory on account.

• Dr. Accounts Receivable          10,000
•    Cr.  Inventory                                  10,000
• Dr. Inventory          10,000
•    Cr. Accounts Payable  10,000
• Dr. Inventory          10,000
•    Cr. Accounts Receivable 10,000
• Dr. Accounts Payable          10,000
•    Cr.  Inventory                                  10,000
• Dr. Inventory          10,000
•    Cr. Cash                         10,000

Q10. Which journal entry reflects the following transaction?:

BOC paid $3,000 upfront for next year’s rent.

• Dr.  Rent Revenue       3,000
•     Cr. Cash                       3,000
• Dr.  Prepaid Rent            3,000
•     Cr.   Cash                      3,000
• Dr. Rent Expense        3,000
•    Cr.  Cash                     3,000
• Dr.  Cash             3,000
•     Cr.  Rent Expense      3,000
• Dr.  Cash                 3,000
•     Cr. Prepaid Rent         3,000

Introduction to Financial Accounting Week 2 Quiz Answers

Quiz 1: Homework #2

Q1. Which of these transactions would produce $10,000 of revenue in December? (check all that apply)

• BOC collected $10,000 of cash in December from customers who received goods in November.
• BOC signed a contract to deliver $10,000 of goods to a customer in January.
• BOC delivered $10,000 of goods in December to a customer that paid a $10,000 cash deposit in November.
• BOC delivered $10,000 of goods in December to customers that ordered them and have 30 days to pay for them.
• BOC collected a $10,000 deposit in December for goods it will ship in January.

Q2. Which of these transactions would produce $10,000 of expenses in December? (check all that apply)

• BOC pays $10,000 in cash dividends in December.
• BOC pays its advertising agency $10,000 in December for ads that ran in December.
• BOC pays its auditor $12,000 in December for all of the work the auditor performed during the year.
• BOC receives a $10,000 invoice from its lawyers for services performed in December. The bill is due in January.
• BOC hires a new COO in December to start work in January. The COO will be paid $10,000 per month.

Q3. Which journal entry reflects the following transaction?:

BOC receives a $2,000 cash deposit from a customer for custom goods that will be delivered next year.

• Dr.  Cash         2,000
•    Cr.  Inventory       2,000
• Dr. Cash     2,000
•    Cr. Revenue   2,000
• Dr.  Deposits    2,000
•    Cr.  Future Revenue    2,000
• Dr.  Advances from Customers      2,000
•    Cr.  Cash                                          2,000
• Dr.  Cash           2,000
•    Cr.  Advances from Customers     2,000

Q4. Which journal entry(s) reflects the following transaction?:

BOC received $5,000 of cash from a customer who took delivery of goods that originally cost BOC $4,000 to acquire.

• Dr.   Cash           5,000
•     Cr.    Inventory          5,000
• Dr.   Cash          5,000
•     Cr.  Revenue         5,000
• Dr. Cash                       5,000
•     Cr.  Revenue                    5,000
• Dr.  Cost of Goods Sold   4,000
•    Cr.  Inventory                     4,000 
• Dr.   Cash   5,000
•     Cr.  Inventory      4,000
•     Cr.  Revenue       1,000
• Dr. Cash                       5,000
•     Cr.  Revenue                    5,000
• Dr.  Accounts Payable   4,000
•    Cr.  Inventory                     4,000 

Q5. How much quarterly depreciation expense would be recognized for a building that originally cost $100,000 and has an estimated useful life of 10 years with a $20,000 salvage value?

• $2,000
• $2,500
• $1,000
• $10,000
• $8,000

Q6. Which journal entry reflects the adjusting entry needed on December 31?:

In November, BOC prepaid $30,000 of rent for December, January, and February (and it was recorded properly). Now, it is December 31, the end of the fiscal year.

• Dr.  Rent Expense        30,000
•    Cr.  Cash                         30,000
• Dr.  Rent Expense        30,000
•    Cr.  Prepaid Rent                   30,000
• Dr.  Rent Expense        10,000
•    Cr.  Prepaid Rent                   10,000
• Dr.  Rent Expense        10,000
•    Cr.  Cash                         10,000
• No entry needed.

Q7. Which journal entry reflects the adjusting entry needed on December 31?:

Last year, BOC purchased software for $10,000. The expected life of the software is 2 years and it has no expected salvage value. Now, it is December 31, the end of the fiscal year. No other entries were recorded for this software during the year.

• Dr.  Software Amortization Expense     5,000
•      Cr.  Cash                                                    5,000
• Dr. Software Amortization Expense 5,000
• Cr. PP&E 5,000
• No entry needed.
• Dr.  Software Amortization Expense     5,000
•      Cr.  Software Revenue                            5,000
• Dr.  Software Amortization Expense     5,000
•      Cr.  Software                                                    5,000

Q8. Which journal entry reflects the adjusting entry needed on December 31?:

In November, BOC received a $5,000 cash deposit from a customer for custom-build goods that will be delivered in January (BOC recorded an entry for this $5,000 in November). Now, it is December 31, the end of the fiscal year.

• Dr.   Unearned Revenue       5,000
•    Cr.  Inventory                                    5,000
• No entry needed.
• Dr.   Advances from Customers   5,000
•    Cr.  Revenue                                        5,000
• Dr.   Cash       5,000
•    Cr.  Revenue               5,000
• Dr.   Unearned Revenue       5,000
•    Cr.  Revenue                                    5,000

Q9. Which item would not appear on the Income Statement?

• Operating Income
• Dividends
• Pre-tax Income
• Gross Profit
• SG&A Expense

Q10. Which of the following are permanent accounts? (check all that apply)

• Unearned Revenue
• Common Stock
• Revenue
• Retained Earnings
• Cost of Goods Sold

Introduction to Financial Accounting Week 3 Quiz Answers

Quiz 1: Homework #3

Q1. Which of the following would be a cash flow from operating activities? (check all that apply)

• Purchases of equipment
• Payments for salaries and wages
• Amortization of a patent
• Loss on sale of equipment
• Collections from customers

Q2. Which of the following would be a cash flow from investing activities? (check all that apply)

• Payments to acquire a company
• Depreciation on a building
• Proceeds from issuing stock
• Proceeds from selling equipment
• Purchases of inventory

Q3. A company has the following cash flows:

Cash from operations (30)

Cash from investing activities (45)

Cash from financing activities 90

Which growth stage best describes this pattern of cash flows?

• Mature
• Decline
• Start-up
• Early growth
• Fossilized

Q4. A company bought a $1,000,000 building and $500,000 of land with a $300,000 cash down payment and used a new mortgage to pay the balance. What is the investing cash flow in this transaction?

• ($1,800,000)
• ($1,000,000)
• ($1,500,000)
• ($1,200,000)
• ($300,000)

Q5. Which of the following would be shown as a negative number in the Operating section of the SCF under the indirect method? (check all that apply)

• Depreciation on a building
• Decrease in Accounts Receivable
• Gain on sale of equipment
• Capital expenditures
• Decrease in Accounts Payable

Q6. A company has Net Income of $20, which included $4 of depreciation expense. There were no other noncash expenses in Net Income and there were no gains or losses. Accounts receivable was $40 at the beginning of the year and $25 at the end of the year. Accounts Payable was $25 at the beginning of the year and $15 at the end of the year. Inventory was $22 at the beginning of the year and $27 at the end of the year. All other balance sheet accounts were unchanged over the year. What was the company’s Cash Flow from Operating Activities?

• $44
• $4
• $54
• $24
• $16

Q7. A company put together a preliminary version of its financial statements. Its Net Income was $200, its Depreciation Expense was $40, and its Cash Flow from Operations was $90. The accountant found an error in computing straight-line Depreciation Expense. It should have been $50. What is Cash from Operations after fixing this mistake? (you can ignore taxes)

• $100
• $90
• $250
• $0
• $80

Q8. A company sold PP&E for $200 cash. Prior to the sale, the net book value of the PP&E on the financial statements was $240. Thus, the company recorded a Loss on Sale of Equipment of $40 in Net Income. What is the operating cash flow in this transaction?

• $40
• $200
• $160
• $240
• $0

Q9. Which of the following transactions would result in the change in Inventory on the SCF being a different number than the change in Inventory on the Balance Sheet? (check all that apply)

• Some of the inventory was sold for cash
• Some of the inventory came in the acquisition of another company
• Some of the inventory was stolen by employees
• Some of the inventory was purchased on account
• Some of the inventory is held by subsidiaries in countries that use a different currency

Q10. A company had EBITDA of $1000, Depreciation and Amortization Expense of $100, Interest Expense of $100, and Tax Expense of $50. What was the company’s Net Income?

• $950
• $1250
• $1000
• $750
• ($750)

Introduction to Financial Accounting Week 4 Quiz Answers

Quiz 1: Final Exam, Part 1

Q1. A company delivered $10,000 of goods to a customer that agreed to pay cash within 30 days. The goods had cost $8,000 to manufacture.

Which of the following items would be increased by this sales transaction? (check all that apply)

• Revenue
• Total Assets
• Accounts Receivable
• Total Liabilities
• Inventory

Q2. A company took delivery of $50,000 of new inventory and agreed to pay cash to the supplier within 30 days.

Which of the following items would be increased by this inventory purchase transaction? (check all that apply)

• Retained Earnings
• Total Assets
• Cost of Goods Sold
• Accounts Payable
• Accounts Receivable

Q3. A company collected $100,000 cash from a customer who both received and was billed for the goods last quarter.

Which of the following items would be increased by this cash collection transaction? (check all that apply)

• Total Stockholders’ Equity
• Accounts Receivable
• Revenue
• Total Assets
• Cash from Operations

Q4. A company collected $10,000 cash from a customer as a deposit for goods that will be shipped next quarter.

Which of the following items would be increased by this cash collection transaction? (check all that apply)

• Total Assets
• Cash from Operations
• Accounts Receivable
• Total Liabilities
• Revenue

Q5. A company received $100,000 cash from issuing 10,000 shares of $4 par value stock.

Which of the following items would be increased by this stock issuance transaction? (check all that apply)

• Revenue
• Total Liabilities
• Additional Paid in Capital
• Total Assets
• Cash from Operations

Q6. A company received $75,000 cash from a bank loan that must be repaid in three years.

Which of the following items would be increased by this bank loan transaction? (check all that apply)

• Cash from Investing
• Interest Payable
• Revenue
• Notes Payable
• Current Assets

Q7. A company declared $500,000 of dividends that will be paid two months from now.

Which of the following items would be increased by this dividend declaration transaction? (check all that apply)

• Net Income
• Retained Earnings
• Cash from Financing
• Total Liabilities
• Dividend Expenses

Q8. A company paid $50,000 to its insurance company for fire insurance coverage over the next year.

Which of the following items would be increased by this insurance prepayment transaction? (check all that apply)

• Current Assets
• Prepaid Insurance
• Insurance Expense
• Unearned Revenue
• Total Stockholders’ Equity

Q9. At the end of the quarter, a company did an adjusting entry to record the fact that $1,000 of Prepaid Advertising had been used up during the quarter.

Which of the following items would be increased by this advertising adjusting entry? (check all that apply)

• Advertising Expense
• Cost of Goods Sold
• Total Liabilities
• Cash from Operations
• Prepaid Advertising

Q10. A company borrowed $500,000 cash from a bank and used it to purchase $500,000 of new manufacturing equipment.

Which of the following items would be increased by the bank loan and equipment purchase transactions? (check all that apply)

• Cash from Investing
• Notes Payable
• Inventory
• Total Assets
• Cash from Financing

Q11. At the end of the quarter, a company did an adjusting entry to record $5,000 of depreciation on the fleet of automobiles used by the sales force.

Which of the following items would be increased by this depreciation adjusting entry? (check all that apply)

• Retained Earnings
• Cost of Goods Sold
• Depreciation Expense
• Total Assets
• Cash from Operations

Q12. A company sold a piece of manufacturing equipment for $30,000 cash. The equipment had been listed on the balance sheet at a net book value of $25,000, so the company recorded a gain on sale of equipment of $5,000.

Which of the following items would be increased by this equipment sale transaction? (check all that apply)

• Cash from Financing
• Cash from Investing
• Cash from Operations
• Cost of Goods Sold
• Retained Earnings

Quiz 2: Final Exam, Part 2

Q1. During the quarter ended 3/31/2015, Clarke Biscuits Inc. collected $100 of cash from customers, paid $60 of cash to suppliers, paid $20 of cash to employees and other creditors, and recorded $10 of depreciation expense. There were no other cash flows related to operating activities.

What was Clarke’s Cash Flow from Operations during the quarter ended 3/31/2015?

• $100
• $20
• $10
• $30
• $(20)

Q2. During 2015, Rindal Vinyards Inc. had EBITDA of $1000, Depreciation and Amortization Expense of $200, Interest Expense of $100, and Tax Expense of $50. What was Rindal Vinyards’ Net Income in 2015?

• $1250
• $650
• $750
• $1000
• $950

Q3. Geller Florist Inc. had the following transactions during 2015:

Purchased a $200,000 warehouse with $50,000 cash and a $150,000 mortgage from a bank.

Raised $100,000 from selling new shares of stock to investors. The cash was used to buy land to grow tulips.

Sold an old building for $50,000 (and suffered a loss on sale of $5,000) and used the cash to buy a new truck.

What is the net impact of these transactions on Geller’s Cash from Investing Activities during 2015?

• $(295,000)
• $(145,000)
• $(50,000)
• $(150,000)
• $(300,000)

Q4. Stewart Export Co. had the following Statement of Cash Flows for the year ended 03/31/15:

($ millions)	Year ended 3/13/15
Net Income	1100
Depreciation	200
Gain on sale of equipment	(400)
Chg in Accounts Receivable	350
Chg in Inventory	(200)
Chg in Other Current Assets	100
Chg in Accounts Payable	(50)
Net Cash from Operations	1250
Capital Expenditures	(1200)
Sale of Equipment	700
Net Cash from Investing	(500)

What was the book value of the equipment Stewart sold during the year ended 03/31/15?

• $500
• $900
• $700
• $300
• $1,100

Q5. Little Scuba Pty had the following line item on its 12/31/2014 Balance Sheet:

	12/31/2014
Accounts Payable	$10,000

Little Scuba’s Statement of Cash Flows had the following line item:

	2014
Change in Accounts Payable	$4,000

Assume that the company made no acquisitions or divestitures and that all operations are in Australia. How much Accounts Payable did Little Scuba have on 12/31/2013?

• $6,000
• $14,000
• $10,000
• $4,000
• $0

Q6. A new accountant, Costa Goodsold, put together a preliminary version of Medina Co.’s financial statements. Medina’s Net Income was $500, its Depreciation Expense was $100, and its Cash Flow from Operations was $70. The CEO found an error that Costa made in computing straight-line Depreciation Expense, which should have been $50. What is Medina’s Cash Flow from Operations after fixing this mistake? (you can ignore taxes)

• $120
• $170
• $70
• $20
• $450

Q7. Joe Doakes was reading the balance sheet of Gogoldze Inc. when he spilled coffee on it. After the coffee spill, the balance sheet looked like this:

($ millions)	12/31/2015
Cash	100
Accounts Receivable	245
Inventory	450
Other Current Assets	60
Current Assets	855
Net Property, Plant, & Equipment	1,160
Total Assets	2,015
Accounts Payable	160
Other Current Liabilities	250
Current Liabilities	410
Long-term Liabilities	900
Common Stock	50
Additional Paid-in Capital	300
Retained Earnings	coffee
Total Liabilities and SE	coffee

What was Gogoldze Inc.’s Retained Earnings at 12/31/2015?

• $960
• $550
• $355
• $3,675
• ($55)

Q8. Francisco Olivas of Olivas Medical Supply Company was reading the financial statements of Alvear Corp. to decide whether he wanted to try to acquire the company. He noticed some mistakes in the Alvear Corp. Income Statement:

($ millions)	Year ended 12/31/2015
Sales revenue	$1200
Gain on sale of equipment	200
Total Revenue	1400
Cost of Goods Sold	(800)
Gross Profit	600
SG&A Expense	(400)
Interest Expense	(50)
Operating Income	150
Interest Revenue	20
Pre-tax income	170
Income Tax Expense	(61)
Net Income	109

What is Alvear Corp.’s Operating Income for the year ended 12/31/2015 after correcting the mistakes?

• ($50)
• $170
• $0
• ($30)
• $200

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