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1) when calculating interest on a promissory note with the maturity date stated in terms
of days, the
a.maker pays more interest if 365 days are used instead of 360
b.maker pays the same interest regardless if 365 or 360 days are used
c.payee receives more interest if 360 days are used instead of 365
d.payee receives less interest if 360 days are used instead of 365
2) the receivables turnover ratio is needed to calculate
a.the average collection period in days
b.market risk
c.return on assets
d.current ratio
3) all of the following adjustments would be deducted in determining net cash provided
by operating activities except a(n)
a.increase in inventories
b.depreciation expense
c.gain on sale of plant assets
d.decrease in accrued expenses payable
4) all of the following statements about short-term investments are true except
a.short-term investments are also call marketable securities
b.trading securities are always classified as short-term investments
c.short-term investments are listed below accounts receivable in the current asset
section of the balance sheet
d.short-term assets must be readily marketable
5) if a loss of $62,000 is incurred in selling (for cash) office equipment having a book
value of $200,000, the total amount reported in the cash flows from investing activities
section of the statement of cash flows is
a.$138,000
b.$200,000
c.$262,000
d.$62,000
6) all of the following are necessary to compute the future value of a single amount
except the
a.interest rate
b.number of periods
c.principal
d.maturity value
7) if companies have identical inventoriable costs but use different inventory flow
assumptions when the price of goods have not been constant, then the
a.cost of goods sold of the companies will be identical
b.cost of goods purchased during the year will be identical
c.ending inventory of the companies will be identical
d.net income of the companies will be identical
8) a company has an average inventory on hand of $60,000 and its average days in
inventory is 29.2 days. what is the cost of goods sold?
a.$750,000
b.$1,752,000
c.$1,680,000
d.$876,000
9) which of the following is not a limitation of internal control?
a.cost of establishing control procedures should not exceed their benefit
b.the human element
c.collusion
d.the size of the company
10) stockholders are most interested in evaluating
a.liquidity
b.solvency
c.profitability
d.marketability
11) a revenueasset relationship exists with:
a.prepaid expense adjusting entries
b.accrued expense adjusting entries
c.unearned revenue adjusting entries
d.accrued revenue adjusting entries
12) barber company reported net income of $120,000 for the year ended december 31,
2012. during the year, inventories decreased by $24,000, accounts payable decreased by
$36,000, depreciation expense was $40,000 and a gain on disposal of equipment of
$18,000 was recorded. net cash provided by operating activities in 2012 using the
indirect method was
a.$238,000
b.$130,000
c.$154,000
d.$110.000
13) the declaration of a stock dividend will
a.increase paid-in capital
b.change the total of stockholders equity
c.increase total liabilities
d.increase total assets
