1. Mountain View Nursing Facility uses a chart of accounts format that is made up of three sets of digits. The first set of digits represents the financial statement element, the second is for a primary subclassification and the third is for a secondary subclassification. To which of these three sets of digits would “Petty cash for the front office” belong? The:
A. Financial statement element
B. Primary subclassification
C. Secondary subclassification
D. None of the above
2. In summary, the chart of accounts:
A. Is a map that the financial manager must and should understand
B. Can be infinitely customized for an organization’s purposes
C. Has generic examples available for reference purposes
D. A & B
E. A & C
F. B & C
G. All of the above
3. The Horizon Pharmaceutical Company makes quarterly payments of payroll taxes withheld, plus the employer’s portion of these payroll taxes. Prior to the quarterly payment, should these taxes be recorded as a:
A. Current liability
B. Short-term liability
C. Long term liability
D. Current asset
E. A & B
F. B & C
4. Buildings and equipment are typically stated at a net figure called:
A. Book value
B. Long term value
C. Historical value
D. None of the above
5. The original cost, or historical cost, of buildings and equipment is reduced by:
A. Accumulated depreciation
B. Accumulated liabilities
C. Reserve for amortization
D. None of the above