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1) using the following data for stevenson industries, compute the return on assets ratio.
a.5.0%
b.10.4%
c.5.5%
d.11.4%
2) the market rate of interest is often called the
a.stated rate
b.effective rate
c.coupon rate
d.contractual rate
3) 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 inventory turnover ratio in 2012 was
a.9.4 times
b.8.3 times
c.7.3 times
d.6.0 times
4) haverty industries increased its gross profit rate from 18.4% in 2011 to 23.7% in
2012. which of the following would be a possible explanation for this change?
a.haverty's global sourcing efforts at the beginning of 2012 resulted in a lower cost of
merchandise sold
b.haverty's new profit lines with lower margins in 2012 became a larger component of
their sales
c.haverty increased its product markdowns in 2012
d.haverty's average margin between the selling price and the inventory cost decreased
over this two-year period
5) rogers company is considering purchasing equipment. the equipment will produce
the following cash flows:
dexter requires a minimum rate of return of 10%. what is the maximum price rogers
should pay for this equipment?
a.$42,975.30
b.$21,487.65
c.$50,000.00
d.$25,000.00
6) denson, inc. has 10,000 shares of 8%, $100 par value, non-cumulative preferred
stock and 40,000 shares of $1 par value common stock outstanding at december 31,
2012. there were no dividends declared in 2011. the board of directors declares and
pays a $120,000 dividend in 2012. what is the amount of dividends received by the
common stockholders in 2012?
a.$0
b.$80,000
c.$120,000
d.$40,000
7) in providing accounting services to small business, you encounter the following
situations pertaining to cash sales.
(1)kushner company rings up sales and sales taxes separately on its cash register. on
april 10 the register totals are sales $30,000 and sales taxes $2,100.
(2)grant company does not segregate sales and sales taxes. its register total for april 15
is $19,080, which includes a 6% sales tax.
instructions
prepare the entries to record the sales transactions and related taxes for (a) company and
(b) grant company.
8) in reviewing the accounts receivable, the net cash receivable value is $16,000 before
the write-off of a $1,500 account. what is the net cash receivable value after the
write-off?
a.$16,000
b.$1,500
c.$17,500
d.$14,500
9) a truck was purchased for $90,000 and it was estimated to have an $6,000 salvage
value at the end of its useful life. monthly depreciation expense of $700 was recorded
using the straight-line method. the annual depreciation rate is
a.12%
b.2%
c.8%
d.10%
10) the term legal capital is a descriptive term for
a.stockholders equity
b.par value
c.residual equity
d.market value
