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Exam: 061555RR - Corporations,Exam: 061553RR - Accounting for Merchandising,Exam: 061554RR - The Value of Money




Exam: 061555RR - Corporations;1. Allied Industrial has net sales of $1,200,000, net income of $85,000, average current assets of $53,000, average fixed assets of $184,000, and average total assets of $237,000. What is Allied Industrial's total asset turnover ratio?;A. 22.64;B. 6.52;C. 0.20;D. 5.06;2. On the income statement, extraordinary items are reported;A. immediately after the continuing operations section.;B. before the operating income section.;C. immediately before the discontinued operations section.;D. net of income tax or net of income tax savings.;3. The formula for computing additional paid-in capital in excess of par is shares of stock times;A. selling price per share plus par value per share.;B. selling price per share minus par value per share.;C. par value per share of stock.;D. selling price per share of stock.;4. Hanna Industries has an inventory turnover of 112 days, an accounts payable turnover of 73 days, and an accounts receivable turnover of 82 days. Hanna's cash conversion cycle is;A. 43 days.;B. 9 days.;C. 103 days.;D. 121 days.;5. Knutson Company reacquired 5,000 shares of its $15-par common stock for $13/share. The debit to Treasury Stock is;A. $75,000.;B. $10,000.;C. $65,000.;D. based on the last treasury stock transaction.;6. A business's Accounts Payable balance has decreased during the year. How would this affect the statement of cash flows operations section under the indirect method?;A. It would be added back to net income.;B. It would be subtracted from net income.;C. It is already included in the net income.;D. It does not affect the cash flow from operations.;7. The Coulter Corporation Stockholders' Equity section includes the following information;What is the total selling price of the common stock?;Preferred Stock $12,000;Paid-in Capital in Excess of Par?Preferred 2,700;Common Stock 15,000;Paid-in Capital in Excess of Par?Common 4,100;Retained Earnings 8,200;A. $14,700;B. $19,100;C. $27,300;D. $15,000;8. Which of the following is not a part of financing activities?;A. Buying land;B. Issuing stock;C. Paying off loans;D. Paying dividends;9. Hallett Industries, Inc. reported net sales of $306,000, cost of goods sold of $192,600, operating expenses of $58,900, and income tax expense of 12,300. What is Hallett Industries' net income percentage?;A. 62.94;B. 13.79;C. 37.06;D. 17.81;10. Which of the following causes the decrease of the par value of a company's stock?;A. Stock dividend;B. Cash dividend;C. Sale of additional stock;D. Stock split;11. When a company sells off part of its business, this transaction is reported;A. in the continuing operations section.;B. in the extraordinary items section.;C. in the discontinued operations section.;D. as a retrospective application.;12. The following information applied to Advanced Industries, Inc. for 2012;What is the dividend yield for Advanced Industries, Inc. (to the nearest tenth of a percent)?;Earnings/share of $17.68;Market price per share of common stock $52;Number of shares of common stock outstanding 52,000;Net income $48,000;Dividends/share $7.14;A. 34.0%;B. 13.7%;C. 92.3%;D. 40.4%;13. Which is not a value placed on a certificate for a share of the company's stock?;A. Market value;B. No par;C. Stated value;D. Par;14. The 2011 and 2012 balance sheets for Newport Industrial showed Cash of $8,000 and $9,500,respectively, Accounts Receivable of $14, 000 and $16,000, respectively, Inventory of $11,000 and $8,000, respectively, and Accounts Payable of $5,000 and $7,000, respectively. Its 2012 income statement showed Net Sales of $108,000, Cost of Goods Sold of $62,000, and Net Income of $27,000. The cash conversion cycle for 2012 (round calculations to two decimal places) is _______ days.;A. 141.94;B. 71.30;C. 30.08;D. 40.56;15. For the years 2011, 2012, and 2013, the sales of Red Line, Inc. are $40,000, $60,000 and $80,000,respectively. If 2011 is the base year, the trend percentage for 2012 was;A. 150%.;B. 0%.;C. 200%.;D. 133%.;16. A company sold an asset with a book value of $56,000 for $35,000 cash. Which of the following is a true statement?;A. Loss on sale equals $21,000 and Cash inflow equals $35,000.;B. Loss on sale equals $35,000 and Cash inflow equals $21,000.;C. Loss on sale equals $35,000 and Cash inflow equals $35,000.;D. Loss on sale equals $56,000 and Cash inflow equals $56,000.;17. Eagle Ridge, Inc. issued 40 shares of $20 par value stock to its accountant in full payment for her $900 fee for assisting in setting up the new company. The entry for the issuance of the stock is a;A. credit to Common Stock for $900.;B. debit to Common Stock for $800.;C. credit to Common Stock for $800.;D. debit to Paid-in Capital in Excess of Par?Common for $100.;18. Haskins, Inc. sells 1,000 shares of $12 par common stock for $20 per share. The journal entry is;A. debit Cash $12,000, credit Common Stock $12,000.;B. debit Cash $20,000, credit Common Stock $20,000.;C. debit Cash $12,000, debit Paid-In Capital in Excess of Par?Common $8,000, credit Common Stock $20,000.;D. debit Cash $20,000, credit Common Stock $12,000, credit Paid-In Capital in Excess of Par-Common Stock $8,000.;19. Sunwest Company's cash reported on the comparative balance sheet was $235,000 in 2011 and $245,300 in 2012. What is the percentage change in cash from 2011 to 2012?;A. +4.20%;B. +4.38%;C. ?4.38%;D. ?4.20%;20. Which is not included in paid-in capital?;A. Additional Paid-in Capital;B. Preferred Stock;C. Common Stock;D. Cash;Exam: 061553RR - Accounting for Merchandising;1. A new car lot would probably cost its inventory using the _______ method of inventory costing.;A. LIFO;B. specific-identification;C. FIFO;D. moving average;2. Which element of internal control deals with a company having large amounts of cash on hand?;A. Control environment;B. Risk assessment;C. Information and communication;D. Control activities;3. Which of the following would probably not need to be disclosed in a footnote?;A. Change of inventory methods;B. A 10% increase in sales;C. A material change in estimated shrinkage;D. A change in depreciation method;4. ABC Corporation pays an invoice for $350 in time to receive a 3% discount. The journal entry for the payment of this invoice is debit Accounts Payable;A. $340, debit Inventory $10, and credit Cash for $350.;B. $350, credit Inventory $10.50, and credit Cash for $339.50.;C. $350 and credit Cash $350.;D. $340 and credit Cash $340.;5. Fraudulent financial reporting typically involves;A. the stockholders.;B. management.;C. the board of directors.;D. employees.;6. If net sales decrease and cost of goods sold increases, the gross profit percentage;A. will change based upon the change in total assets.;B. remains the same.;C. decreases.;D. increases.;7. Beginning inventory plus net purchases equals;A. cost of goods sold.;B. cost of goods available for sale.;C. gross profit.;D. ending inventory.;8. _______ occurs if a disgruntled employee convinces another to steal from the company.;A. Collusion;B. Monitoring;C. A control activity;D. The control environment;9. A/An _______ is used to determine the amount of inventory actually on hand at the end of the;accounting period.;A. physical inventory count;B. inventory shrinkage;C. inventory layer;D. footnote;10. An audit opinion in which the auditors are taking exception to a specific treatment of accounting information is the;A. disclaimer of opinion.;B. adverse opinion.;C. qualified opinion.;D. unqualified opinion.;11. Which of the following is not part of the control environment?;A. Having integrity and ethical values;B. Having a leadership philosophy;C. Having competent workers;D. Assessing chances of fraud;12. An employee believes that getting away with fraud without being detected is likely. This best relates to which element of the fraud triangle?;A. Realization;B. Perceived pressure;C. Perceived opportunity;D. Rationalization;13. Olympic Enterprises has the following inventory data;Assuming FIFO, what is the cost of goods sold for June 14?;Date Quantity Unit Cost;June 1 Beginning inventory 5 $52;June 4 Purchase 10 $55;June 7 Sale 12;June 11 Purchase 9 $58;June 14 Sale 8;A. $456;B. $455;C. $464;D. $440;14. Goods available for sale are $350,000, beginning inventory is $24,000, ending inventory is $32,000,and cost of goods sold is $275,000. What is the inventory turnover?;A. 9.82;B. 12.50;C. 11.46;D. 8.59;15. In order to pay the least income tax possible in periods of constant costs, the company should use which of the following inventory costing methods?;A. Any method, as there is no effect on net income or taxes for the period if costs are constant.;B. Average cost;C. FIFO;D. LIFO;16. If a misstatement of inventory occurs, the net income for _______ periods will be misstated.;A. 3;B. 0;C. 1;D. 2;17. Under the perpetual inventory method, purchased goods are recorded to the;A. Inventory account as a debit.;B. Purchases account as a credit.;C. Purchases account as a debit.;D. Cost of Goods Sold account as a debit.;18. The _______ method is used to estimate the cost of ending inventory.;A. LIFO;B. gross profit;C. FIFO;D. average cost;19. A company has net sales of $126,000, cost of goods sold of $72,000, operating expenses of $38,000,and other expenses of $3,000. Approximately what is the company's gross profit percentage?;A. 0.103;B. 0.241;C. 0.429;D. 0.127;20. Under a perpetual inventory system, when goods are returned to a retailer from a customer, _______ is debited and _______ is credited.;A. Inventory, Sales;B. Sales, Cost Goods Sold;C. Sales Returns and Allowances, Cost of Goods Sold;D. Cost of Goods Sold, Sales Returns and Allowances;Exam: 061554RR - The Value of Money;1. Subtracting accumulated depletion from the asset account coal mine yields the;A. original cost.;B. current market value.;C. current period's depletion expense.;D. net book value.;2. Bonds that can be exchanged for stock are called;A. debenture bonds.;B. serial bonds.;C. callable bonds.;D. convertible bonds.;3. A 135-day note issued on May 17 will mature on;A. October 1.;B. September 29.;C. September 30.;D. September 28.;4. Which of the following accounts is credited in a journal entry for an asset exchange?;A. Accumulated Depreciation for truck (old);B. Truck (new);C. Truck (old);D. Loss on Exchange of Assets;5. Skymaster, Inc. has cash of $33,000, net accounts receivable of $41,000, short-term investments of $15,000, and inventory of $25,000. It also has $30,000 in current liabilities and $50,000 in long-termliabilities. What is the current ratio for Skymaster, Inc.?;A. 1.48;B. 2.47;C. 3.80;D. 1.43;6. The disclosure of a contingent liability only in the footnotes designates that the possibility of an actual obligation occurring is;A. possible.;B. remote.;C. probable.;D. certain.;7. A $450 collection on a note from a customer is reflected on Columbia Electric's bank statement. When doing the bank reconciliation, Columbia should;A. subtract $450 from their book balance.;B. subtract $450 from the bank balance.;C. add $450 to their book balance.;D. add $450 to the bank balance.;8. If a company has 90-day credit terms, its expected accounts receivable turnover is;A. 4.;B. 12.;C. 1.;D. 2.;9. On January 1, Bestway, Inc. signed a $175,000, 8%, 30-year mortgage that requires semiannual payments of $7,735 on June 30 and December 31 of each year. The journal entry for the first semiannual payment (with interest rounded to the nearest dollar) is;A. debit Mortgage payable, $7,735, credit Cash, $7,735.;B. debit Interest expense, $7,000, debit Mortgage payable, $735, credit Cash, $7,735.;C. debit Interest expense, $735, debit Mortgage payable, $7,000, credit Cash, $7,735.;D. debit Interest expense, $7,000, debit Mortgage expense, $735, credit Cash, $7,735.;10. Which of the following would not be considered an intangible asset?;A. Copyright;B. Land;C. Franchise;D. Goodwill;11. Outstanding checks are;A. subtracted from the bank balance.;B. added to the book balance.;C. subtracted from the book balance.;D. added to the bank balance.;12. Capital leases are most similar to;A. regular notes payable.;B. accounts payable.;C. mortgage notes.;D. unearned revenue.;13. Which of the following would not be considered part of the cost of machinery and equipment?;A. Repairs and maintenance after start-up;B. Delivery charges;C. In-transit insurance costs;D. Installation costs;14. A $10,000 bond issued with a stated interest rate of 7%, when the market rate of interest is 8%, means that the bond will be sold for;A. the maturity value.;B. less than $10,000.;C. $10,000.;D. more than $10,000.;15. A building was purchased on August 1 for $450,000. The building has a salvage value of $38,000 and a useful life of 35 years. Using the straight-line method, how much is the depreciation expense for the building for the first year, ending December 31 (to the nearest dollar)?;A. $4,905;B. $11,771;C. $12,857;D. $5,357;16. Haskins, Inc. has total assets of $600,000, total liabilities of $175,000, and total stockholders' equity of $425,000. What is Haskin's debt ratio?;A. 41.2%;B. 70.8%;C. 17.1%;D. 29.2%;17. Costs that should be charged to the land account include;A. the cost of removing unwanted buildings.;B. installing fences.;C. paving the parking lot.;D. the cost of a sign.;18. If an asset produces more revenue in its early years, the depreciation method best suited for this asset is the;A. expense method.;B. double-declining balance method.;C. units-of-production method.;D. straight-line method.;19. Proceeds from credit card and debit card transactions are generally deposited into a business's bank account within;A. a month.;B. a week.;C. one to three days.;D. three to five days.;20. A liability, such as warranties payable, is an example of a/an;A. accrued liability.;B. contingent liability.;C. known liability.;D. estimated liability.


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