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ACC 610 Financial Reporting MCQs

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Question;At Ruth Company, events and transactions during 2012 included the following. The tax rate for all items is 30%.(1) Depreciation for 2010 was found to be understated by $60,000.(2) A strike by the employees of a supplier resulted in a loss of $50,000.(3) The inventory at December 31, 2010 was overstated by $80,000.(4) A flood destroyed a building that had a book value of $1,000,000. Floods are very uncommon in that area.The effect of these events and transactions on 2012 net income net of tax would be;$777,000.$833,000.$35,000.$735,000.;Prophet Corporation has an extraordinary loss of $600,000, an unusual gain of $420,000, and a tax rate of 40%. At what amount should Prophet report each item?Extraordinary loss Unusual gain;$(600,000) $420,000;(360,000) 252,000;(600,000) 252,000;(360,000) 420,000;In 2012, Benfer Corporation reported net income of $280,000. It declared and paid common stock dividends of $32,000 and had a weighted average of 70,000 common shares outstanding. Compute the earnings per share to the nearest cent.;$4.00$3.54$2.80$3.60;Multiple Choice Question Moorman Corporation reports the following information:Correction of understatement of depreciation expense in prior years, net of tax $ 615,000Dividends declared 480,000Net income 1,500,000Retained earnings, 1/1/12, as reported 3,000,000Moorman should report retained earnings, 12/31/12, as adjusted at;$4,665,000.$4,020,000.$3,405,000.$2,355,000.;Multiple Choice Question Korte Company reported the following information for 2012:Sales revenue $1,500,000Cost of goods sold 1,050,000Operating expenses 165,000Unrealized holding gain on available-for-sale securities 60,000Cash dividends received on the securities 6,000For 2012, Korte would report comprehensive income of;$291,000.$345,000.$60,000.$351,000.;Multiple Choice Question For Randolph Company, the following information is available:Capitalized leases $ 560,000Trademarks 180,000Long-term receivables 210,000In Randolph?s balance sheet, intangible assets should be reported at;$770,000$210,000$740,000$180,000;Multiple Choice Question Presented below are data for Antwerp Corp.2012 2013 2014Assets, January 1 $ 2,600 $ 3,360?Liabilities, January 1 1,680? $ 2,016Stockholders' Equity, Jan. 1?? 2,100Dividends 560 420 476Common Stock 504 448 500Stockholders' Equity, Dec. 31?? 1,596Net Income 560 448?Stockholders' Equity at January 1, 2012 is;$920$1,424$504$560;Multiple Choice Question Presented below are data for Caracas Corp.2012 2013 2014Assets, January 1 $ 3,800 $ 4,560?Liabilities, January 1 2,280? $ 2,736Stockholders' Equity, Jan. 1?? 2,750Dividends 760 570 646Common Stock 684 608 650Stockholders' Equity, Dec. 31?? 2,166Net Income 760 684?Net income for 2014 is;$138 income.$138 loss.$584 income.$62 income.Multiple Choice Question During 2012 the DLD Company had a net income of $55,000. In addition, selected accounts showed the following changes:Accounts Receivable $ 3,000 increaseAccounts Payable 1,000 increaseBuilding 4,000 decreaseDepreciation Expense 1,500 increaseBonds Payable 8,000 increaseWhat was the amount of cash provided by operating activities?;$64,500$56,500$54,500$55,000;Multiple Choice Question Packard Corporation reports the following information:Net cash provided by operating activities $ 235,000Average current liabilities 150,000Average long-term liabilities 100,000Dividends declared 60,000Capital expenditures 110,000Payments of debt 35,000Packard?s cash debt coverage ratio is;2.351.593.920.94Multiple Choice Question;(78.)Measures of how effectively the company uses its assets are;liquidity ratios.activity ratios.coverage ratios.profitability ratios.;Multiple Choice Question Charlie Corp. is purchasing new equipment with a cash cost of $150,000 for an assembly line. The manufacturer has offered to accept $34,440 payment at the end of each of the next six years. How much interest will Charlie Corp. pay over the term of the loan?;$56,640.$184,440.$34,440.$150,000.;Multiple Choice Question John Jones won a lottery that will pay him $2,000,000 after twenty years. Assuming an appropriate interest rate is 5% compounded annually, what is the present value of this amount?;$753,780.$24,924,420.$2,000,000.$5,306,600.;Multiple Choice Question Jane wants to set aside funds to take an around the world cruise in four years. Jane expects that she will need $10,000 for her dream vacation. If she is able to earn 8% per annum on an investment, how much will she have to set aside today so that she will have sufficient funds available?;$2,219.$13,604.$7,350.$6,806;Multiple Choice Question Renfro Corporation will invest $50,000 every December 31st for the next six years (2012 ? 2017). If Renfro will earn 12% on the investment, what amount will be in the investment fund on December 31, 2017?;$454,450.$205,570$230,240.$405,760.;Multiple Choice Question What would you pay for an investment that pays you $20,000 at the end of each year for the next ten years and then returns a maturity value of $300,000 after ten years? Assume that the relevant interest rate for this type of investment is 8%.;$273,158.$138,958.$134,202.$144,936;Multiple Choice Question What would you pay for an investment that pays you $15,000 at the end of each year for the next twenty years? Assume that the relevant interest rate for this type of investment is 12%.;$1,080,786.$112,042.$15,550.$125,487.;Multiple Choice Question The market price of a $500,000, ten-year, 12% (pays interest semiannually) bond issue sold to yield an effective rate of 10% is;$562,311.$566,635.$936,180.$561,445.;Exercise 6-3Using the appropriate interest table, answer each of the following questions. (Each case is independent of the others.);(a) What is the future value of $8,160 at the end of 7 periods at 8% compounded interest? (Round answers to 0 decimal places, e.g. $458,581.)The future value $;(b) What is the present value of $8,160 due 8 periods hence, discounted at 11%? (Round answers to 0 decimal places, e.g. $458,581.)The present value $;(c) What is the future value of 16 periodic payments of $8,160 each made at the end of each period and compounded at 10%? (Round answers to 0 decimal places, e.g. $458,581.)The future value $;(d) What is the present value of $8,160 to be received at the end of each of 18 periods, discounted at 5% compound interest? (Round answers to 0 decimal places, e.g. $458,581.)The present value

 

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