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




Question;Exam: 061555RR - Corporations1. 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. 22.64B. 6.52C. 0.20D. 5.062. On the income statement, extraordinary items are reportedA. 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 timesA. 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 isA. 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 isA. $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 $12,000Paid-in Capital in Excess of Par?Preferred 2,700Common Stock 15,000Paid-in Capital in Excess of Par?Common 4,100Retained Earnings 8,200A. $14,700B. $19,100C. $27,300D. $15,0008. Which of the following is not a part of financing activities?A. Buying landB. Issuing stockC. Paying off loansD. Paying dividends9. 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. 62.94B. 13.79C. 37.06D. 17.8110. Which of the following causes the decrease of the par value of a company's stock?A. Stock dividendB. Cash dividendC. Sale of additional stockD. Stock split11. When a company sells off part of its business, this transaction is reportedA. 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 $17.68Market price per share of common stock $52Number of shares of common stock outstanding 52,000Net income $48,000Dividends/share $7.14A. 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 valueB. No parC. Stated valueD. Par14. 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. 141.94B. 71.30C. 30.08D. 40.5615. 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 wasA. 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 aA. 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 isA. 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. Which is not included in paid-in capital?A. Additional Paid-in CapitalB. Preferred StockC. Common StockD. CashExam: 061553RR - Accounting for Merchandising1. A new car lot would probably cost its inventory using the _______ method of inventory costing.A. LIFOB. specific-identificationC. FIFOD. moving average2. Which element of internal control deals with a company having large amounts of cash on hand?A. Control environmentB. Risk assessmentC. Information and communicationD. Control activities3. Which of the following would probably not need to be disclosed in a footnote?A. Change of inventory methodsB. A 10% increase in salesC. A material change in estimated shrinkageD. A change in depreciation method4. 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 PayableA. $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 involvesA. 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 percentageA. will change based upon the change in total assets.B. remains the same.C. decreases.D. increases.7. Beginning inventory plus net purchases equalsA. 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. CollusionB. MonitoringC. A control activityD. The control environment9. A/An _______ is used to determine the amount of inventory actually on hand at the end of theaccounting period.A. physical inventory countB. inventory shrinkageC. inventory layerD. footnote10. An audit opinion in which the auditors are taking exception to a specific treatment of accounting information is theA. 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 valuesB. Having a leadership philosophyC. Having competent workersD. Assessing chances of fraud12. An employee believes that getting away with fraud without being detected is likely. This best relates to which element of the fraud triangle?A. RealizationB. Perceived pressureC. Perceived opportunityD. Rationalization13. Olympic Enterprises has the following inventory data:Assuming FIFO, what is the cost of goods sold for June 14?Date Quantity Unit CostJune 1 Beginning inventory 5 $52June 4 Purchase 10 $55June 7 Sale 12June 11 Purchase 9 $58June 14 Sale 8A. $456B. $455C. $464D. $44014. 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. 9.82B. 12.50C. 11.46D. 8.5915. 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 costC. FIFOD. LIFO16. If a misstatement of inventory occurs, the net income for _______ periods will be misstated.A. 3B. 0C. 1D. 217. Under the perpetual inventory method, purchased goods are recorded to theA. 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. LIFOB. gross profitC. FIFOD. average cost19. 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. 0.103B. 0.241C. 0.429D. 0.12720. Under a perpetual inventory system, when goods are returned to a retailer from a customer, _______ is debited and _______ is credited.A. Inventory, SalesB. Sales, Cost Goods SoldC. Sales Returns and Allowances, Cost of Goods SoldD. Cost of Goods Sold, Sales Returns and AllowancesExam: 061554RR - The Value of Money1. Subtracting accumulated depletion from the asset account coal mine yields theA. 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 calledA. debenture bonds.B. serial bonds.C. callable bonds.D. convertible bonds.3. A 135-day note issued on May 17 will mature onA. 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 Assets5. 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. 1.48B. 2.47C. 3.80D. 1.436. The disclosure of a contingent liability only in the footnotes designates that the possibility of an actual obligation occurring isA. 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 shouldA. 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 isA. 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) isA. 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. CopyrightB. LandC. FranchiseD. Goodwill11. Outstanding checks areA. 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 toA. 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-upB. Delivery chargesC. In-transit insurance costsD. Installation costs14. 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 forA. 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. $4,905B. $11,771C. $12,857D. $5,35716. 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 includeA. 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 theA. 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/anA. accrued liability.B. contingent liability.C. known liability.D. estimated liability.


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