The expense associated with the cost of uncollectible accounts receivable is known as
bad debts expense.
A purchase discount is the amount offered to the purchaser for delaying the payment to
the seller.
For the year ended December 31, 2016, the Statement of Cash Flows for Johnson
Family Auto Supply shows the following information: Net Cash Used by Operating
Activities, $70,000; Net Cash Provided by Investing Activities, $45,000; and Net Cash
Provided by Financing Activities, $40,000. Cash has increased by $155,000.
The primary objective of financial reporting is to provide information useful for making
investment and lending decisions.
Horizontal analysis provides a year-to-year comparison of a company’s performance in
different periods.
Rocco earns $14.50 per hour for straight time (40 hours), and the company pays him
time-and-a-half for overtime. He worked 46 hours at his job during the first week of
March 2017. What was Rocco’s gross pay for the week?
A) $667.00
B) $671.50
C) $710.50
D) $1,000.50
Jason’s gross pay for the week is $1,900. His yearly pay is under the limit for OASDI.
Assume that the rate for state and federal unemployment compensation taxes is 6% and
that Jason’s year-to-date pay has not yet exceeded the $7,000 cap. His yearly pay is
under the limit for OASDI. What is the total amount of payroll taxes that his employer
must record as payroll tax expenses? (Do not round your intermediate calculations.
Assume a FICA-OASDI Tax of 6.2% and FICA-Medicare Tax of 1.45%.)
A) $107.35
B) $117.80
C) $259.35
D) $233.74
The financial statements of Weston Office Supply include the following items:
What is 2017 current ratio? (Round your answer to two decimal places.)
A) 0.84
B) 0.56
C) 1.19
D) 1.70
Compute the present value of an ordinary annuity that pays $13,000 per year for 15
years at 10%.Present value of annuity of $1:
A) $98,878
B) $99,745
C) $97,578
D) $100,178
Under which of the following categories would bonds held as an investment for less
than a year appear?
A) Long-term assets
B) Current assets
C) Long-term liabilities
D) Current liabilities
The financial statements of Barker Office Furniture Company include the following
items:
What is working capital for 2017?
A) $204,000
B) $68,500
C) $36,500
D) $90,500
On November 1, 2016, EZ Products borrowed $64,000 on a 5%, 5-year note with
annual installment payments of $12,800 plus interest due on November 1 of each
succeeding year. On November 1, 2018, what is the balance of the Long-Term Notes
Payable account? (Round your answer to nearest whole number.)
A) $38,400
B) $64,000
C) $51,200
D) $12,800
An enterprise resource planning (ERP) is a ________.
A) hardware system that controls the access of employees to different levels of
production in a firm
B) software system used by small companies to record revenue and expenses
C) hardware system of electronic linkages that allows different computers to share the
same information
D) software system that can integrate all of a company’s functions, departments, and
data into a single system
For a promissory note, the entity to whom the promise of future payment is made is the
________.
A) maker of the note
B) endorser of the note
C) banker of the note
D) payee of the note
The financial statements for Lexington Service Company include the following items:
Compute the current ratio for 2016. (Round answer to two decimal places.)
A) 1.19
B) 0.84
C) 3.95
D) 6.66
Alexander Corp. has the following balances as of December 31, 2017:
Calculate the debt to equity ratio. (Round your answer to two decimal points.)
A) 0.64
B) 0.92
C) 1.56
D) 2.56