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1) snug-as-a-bug blankets has the following inventory data:
assuming that a perpetual inventory system is used, what is the ending inventory on a
lifo basis for july?
a.$4,122
b.$4,131
c.$4,158
d.$8,694
2) alt corp. issues 2,000 shares of $10 par value common stock at $14 per share. when
the transaction is recorded, credits are made to:
a.common stock $20,000 and paid-in capital in excess of stated value $8,000
b.common stock $28,000
c.common stock $20,000 and paid-in capital in excess of par value $8,000
d.common stock $20,000 and retained earnings $8,000
3) comprehensive income under ifrs
a.includes unrealized gains and losses included in net income, in contrast to gaap
b.includes unrealized gains and losses included in net income, similar to gaap
c.excludes unrealized gains and losses included in net income, in contrast to gaap
d.excludes unrealized gains and losses included in net income, similar to gaap
4) a small stock dividend is defined as
a.less than 30% but greater than 25% of the corporations issued stock
b.between 50% and 100% of the corporations issued stock
c.more than 30% of the corporations issued stock
d.less than 20-25% of the corporations issued stock
5) using the following balance sheet and income statement data, what is the current
ratio?
a.1.75 : 1
b.1.6 : 1
c.0.57 : 1
d.3.3 : 1
6) k2 corporation has assets of $1.80 million, common stock of $468,000, and retained
earnings of $285,000. what are the creditors claims on their assets?
a.$1,617,000
b.$ 753,000
c.$1,047,000
d.$1,983,000
7) under ifrs, bank overdrafts are classified as
a. operating activities
b. investing activities
c. financing activities
d. cash and cash equivalents
8) an asset was purchased for $200,000. it had an estimated salvage value of $40,000
and an estimated useful life of 10 years. after 5 years of use, the estimated salvage value
is revised to $32,000 but the estimated useful life is unchanged. assuming straight-line
depreciation, depreciation expense in year 6 would be
a.$24,000
b.$17,600
c.$12,000
d.$16,800
9) the following items are taken from the financial statements of grove company for
2012:
accounts payable$18,500
accounts receivable4,000
accumulated depreciation4,800
bonds payable18,000
cash24,000
common stock25,000
cost of goods sold17,000
depreciation expense4,800
dividends5,300
equipment44,000
interest expense2,500
patents7,500
retained earnings, january 116,000
salaries expense5,200
sales revenue36,500
supplies4,500
instructions
(a)prepare an income statement and a classified balance sheet for grove company.
(b)compute the following ratios and values:
1>current ratio
2>debt to total assets ratio
3>working capital
4>earnings per share (groves average number of shares outstanding during the year was
5,000.)
10) kathys blooms purchased a delivery van for $40,000. the company was given a
$4,000 cash discount by the dealer, and paid $2,000 sales tax. annual insurance on the
van is $1,000. as a result of the purchase, by how much will kathys blooms increase its
van account?
a.$40,000
b.$36,000
c.$39,000
d.$38,000
11) reporting investments at fair value is
a.applicable to equity securities only
b.applicable to debt securities only
c.applicable to both debt and equity securities
d.a conservative approach because only losses are recognized
12) financial information is presented below:
the amount of net sales on the income statement would be
a.$154,000
b.$141,000
c.$160,000
d.$166,000
13) using the following balance sheet and income statement data, what is the earnings
per share?
a.$4.20
b.$6.00
c.$2.40
d.$0.42
14) match the items below by entering the appropriate code letter in the space provided.
1>small expenditures which primarily benefit the current period.
2>cost less accumulated depreciation.
3>an accelerated depreciation method used for financial statement purposes.
4>tangible resources that are used in operations and are not intended for resale.
5>equal amount of depreciation each period.
6>expected cash value of the asset at the end of its useful life.
7>process of allocating the cost of equipment over its service life.
8>material expenditures that increase an asset's operating efficiency, productive
capacity, or useful life.
9>an accelerated depreciation method used for tax purposes.
10>useful life is expressed in terms of units of production or expected use.
15) a disbursement system that uses wire, telephone, computers, etc., to transfer cash
from one location to another is referred to as ______________.
16) the acquisition of inventory is debited to the ____________ account when a
perpetual inventory system is used.
17) assume that mitchell company uses a periodic inventory system and has these
account balances: purchases $650,000; purchase returns and allowances $25,000;
purchases discounts $11,000; and freight-in $19,000; beginning inventory of $45,000;
ending inventory of $55,000; and net sales of $750,000. determine the amounts to be
reported for cost of goods sold and gross profit.
18) selected data from the martinez company are presented below:
instructions
assuming that no dividends were declared or paid during the period, calculate the
following profitability ratios from the above information:
1> profit margin ratio
2> asset turnover ratio
3> return on assets ratio
4> return on common stockholders equity ratio
19) an adjusting entry always involves a balance sheet account and an income statement
account.
