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(TCO A) An advantage of the corporate form of business




Question;(TCO A) An advantage of the corporate form of business;Customer Question;1. (TCO A) An advantage of the corporate form of business is;it is simple to establish;the corporate tax rate is less than the personal tax rate;corporations must pay dividends;the shareholders are not responsible for the corporation?s;debts;Question 2. 2. (TCO A) Dividends flow through which one of;the following statements?;The Balance Sheet;The Statement of Retained Earnings;The Income Statement;None of the above;Question 3. 3. (TCOs A, B) Below is a partial list of;account balances for LBJ Company;Cash;$12,000;Prepaid insurance;1,300;Accounts receivable;7,000;Accounts payable;5,000;Notes payable;9,000;Common stock;22,000;Dividends;2,000;Revenues;45,000;Expenses;35,000;What did LBJ Company show as total debits?;$57,300;$81,000;$55,300;$56,000;Question 4. 4. (TCOs B, E) Which of the following statements;is correct with regard to accrual accounting?;Accrual accounting is consistent with the matching;principle.;Accrual accounting is less complex than the cash-basis;method.;Accrual accounting does not record expenses until paid.;Accrual accounting does not record revenue until payment is;received.;Question 5. 5. (TCO D) Two different companies utilize a;different inventory costing method. If the price of goods has decreased during;the period, then the company using _____.;LIFO will have the highest cost of goods sold;average cost will have the highest cost of goods sold;FIFO will have the highest ending inventory;LIFO will have the highest ending inventory;Question 6. 6. (TCO A, E) Equipment was purchased for;$27,000. Freight charges amounted to $1,000 and there was a cost of $5,000 for;building a foundation and installing the equipment. It is estimated that the;equipment will have a $5,000 salvage value at the end of its 7-year useful;life. Depreciation expense each year using the straight-line method will be;$4,714;$4,000;$3,857;$3,285;Question 7. 7. (TCOs D, G) When the market rate of interest;is less than the stated rate of interest on the bond, the bond will require;a debit to Discount on Bonds Payable;a credit to Premium on Bonds Payable;a credit to Loss on Bonds Payable;a debit to Gain on Bonds Payable;Question 8. 8. (TCO C) Accounts receivable arising from;sales to customers amounted to $75,000 and $90,000 at the beginning and end of;the year, respectively. Income reported on the income statement for the year;was $100,000. Based on these transactions, the cash flows from operating;activities to be reported on the statement of cash flows would be _____.;$115,000;$85,000;$175,000;$190,000;Question 9. 9. (TCO F) If you are calculating the percentage;change between 2 years worth of sales data, you are conducting a _____. (Points;5);common-size analysis;vertical analysis;horizontal analysis;ratio analysis;Question 10. 10. (TCO F) Vertical analysis is also known as;ratio analysis;linear analysis;common-size analysis;linear analysis;Question 11. 11. (TCO F) Which one of the following is;typically analyzed via financial statement ratio analysis?;The design of a new product;The internal control failure rate;The leverage of the firm;The effectiveness of a marketing campaign;Question 12. 12. (TCO F) A common ratio to measure;profitability is the _____.;quick ratio;inventory turnover;days? sales in receivables;asset turnover


Paper#49253 | Written in 18-Jul-2015

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