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The ratios used in evaluating a company's liquidity and short-term debt paying ability
that complement each other are the ______________ ratio and the ______________
ratio.
Answer:
Each bondholder may vote for the board of directors in proportion to the number of
bonds held.
Answer:
Accountants who are employees of business enterprises are referred to as
________________ accountants.
Answer:
Kate Company uses a perpetual inventory system and purchased inventory from Phoebe
Company. The shipping costs were $500 and the terms of the shipment were FOB
shipping point. Kate would have the following entry regarding the shipping charges:
Answer:
Important objectives of a system of internal controls are to safeguard assets and to
enhance the accuracy and reliability of the accounting records. Briefly discuss how (1)
cost-benefit considerations, (2) the human element, and (3) the size of the business,
affect the implementation of a system of internal controls.
Answer:
Stockton Corporation has 160,000 shares of $5 par value common stock outstanding. It
declared a 15% stock dividend on June 1 when the market price per share was $13. The
shares were issued on June 30.
Instructions
Prepare the necessary entries for the declaration and payment of the stock dividend.
Answer:
The reference column in a sales journal is used to indicate the general ledger account
number when the entry is posted.
Answer:
The terms of the bond issue are set forth in a formal legal document called a bond
indenture.
Answer:
A cash payments journal should not be used to record transactions which require
payment by check.
Answer:
