1) after transaction information has been recorded in the journal, it is transferred to the
a.trial balance.
b.income statement.
c.general journal.
d.ledger.
2) harden corporation engaged in the following transaction. assume that the harden
corporation uses the indirect method to depict cash flows. indicate where, if at all, a
stock dividend declared and issued would be classified on the statement of cash flows.
a.operating activities section
b.investing activities section
c.financing activities section
d.does not represent a cash flow
3) vertical analysis is also known as
a.perpendicular analysis
b.common size analysis
c.trend analysis
d.straight-line analysis
4) the consistent application of an inventory costing method enhances
a.conservatism
b.accuracy
c.comparability
d.efficiency
5) expected direct materials purchases in rees company are $70,000 in the first quarter
and $90,000 in the second quarter. forty percent of the purchases are paid in cash as
incurred, and the balance is paid in the following quarter. the budgeted cash payments
for purchases in the second quarter are:
a.$96,000
b.$90,000
c.$78,000
d.$72,000
6) if the retained earnings account decreases from the beginning of the year to the end
of the year, then
a.net income is less than dividends
b.there was a net income and no dividends
c.additional investments are less than net losses
d.net income is greater than dividends
7) the balance sheet for renner corporation at the end of the current year includes the
following:
net income was $565,000 and income tax expense for the current year amounted to
$285,000. cash dividends paid on common stock were $200,000, and the common stock
was selling for $40 per share at the end of the year. there were no ownership changes
during the year.
instructions
determine each of the following:
(a)number of times that bond interest was earned.
(b)earnings per share for common stock.
(c)price-earnings ratio.
8) under ifrs, companies can apply revaluation to
a.land, buildings, and intangible assets
b.land, buildings, but not intangible assets
c.intangible assets, but not land
d.no assets
9) gaap defines market for lower-of-cost-or market essentially as
a.net realizable value
b.estimated selling price in the ordinary course of business
c.replacement cost
d.replacement cost less costs of disposal
10) in the credit terms of 1/10, n/30, the 1 represents the
a.number of days in the discount period
b.full amount of the invoice
c.number of days when the entire amount is due
d.percent of the cash discount
11) (a)when should a long-term investment in common stock be accounted for by the
equity method?
(b)when is revenue recognized under the equity method?
12) issuing shares of stock in exchange for cash is an example of a(n)
a.delivering activity
b.investing activity
c.financing activity
d.operating activity
13) all of the following are items that would most likely be paid from a petty cash fund
except:
a.postage due
b.taxi fares
c.administrative wages
d.freight-out
14) the following information was available for bowyer company at december 31, 2012:
beginning inventory $90,000; ending inventory $70,000; cost of goods sold $660,000;
and sales $900,000. bowyers days in inventory in 2012 was
a.38.8 days
b.44.0 days
c.50.0 days
d.60.8 days
15) tidwell company’s goods in transit at december 31 include sales made
(1)fob destination
(2)fob shipping point
and purchases made
(3)fob destination
(4)fob shipping point.
which items should be included in tidwell’s inventory at december 31?
a.(2) and (3)
b.(1) and (4)
c.(1) and (3)
d.(2) and (4)
16) use the following data to determine the total amount of working capital.
carne auto supplies
a.$155,000
b.$145,000
c.$60,000
d.$150,000
17) the following information is provided for nguyen company and northwest
corporation.
if nguyen and northwest are in the same industry and the industry average for the asset
turnover ratio is equal to 1.20 times, which of the following statements is true?
a.nguyen is operating more efficiently than the industry
b.northwest is operating more efficiently than nguyen
c.both nguyen and northwest are operating more efficiently than the average company
in their industry
d.the asset turnover ratio does not address the question of efficient operations
18) winrow company received proceeds of $377,000 on 10-year, 8% bonds issued on
january 1, 2011. the bonds had a face value of $400,000, pay interest annually on
december 31st, and have a call price of 101. winrow uses the straight-line method of
amortization. what is the amount of interest winrow must pay the bondholders in 2011?
a.$30,160
b.$32,000
c.$34,300
d.$29,700