1) Briefly describe the time value of money. Why is the time value of money important
in capital budgeting?
2) The minimum acceptable rate of return on an investment is called the
________________.
3) _________________________ securities reflect a creditor relationship while
____________________ securities reflect an owner relationship.
4) The adjusted trial balance of the Thomas Company follows:
Prepare the closing entries for Thomas Company.
5) Stock that is not assigned a value per share by the corporate charter is called
________________.
6) Prepare a November 30 balance sheet in proper form for Green Bay Delivery Service
from the following alphabetical list of the accounts at November 30:
7) Fleming Company had the following results of operations for the past year:
A foreign company (whose sales will not affect Fleming’s regular sales) offers to buy
2,000 units at $5.00 per unit. In addition to variable manufacturing costs, there would
be shipping costs of $1,200 in total on these units. Should Fleming take this order?
Explain.
8) Explain stock options and their effect on the company.
9) A partnership that has at least two classes of partners, general and limited, allows the
limited partners to have no personal liability beyond the amounts they invest in the
partnership, and the limited partners have no active role except as specified in the
partnership agreement is a ________________________ partnership.
10) Describe the three types of activities reported on the statement of cash flows.