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300. During a period of rising prices, if a firm desires to report a low gross profit figure in
hopes of reducing their income tax liability, the firm will use the __________ inventory valuation
method.
301. Rapidly growing companies often buy increasing amounts of merchandise from suppliers
on credit, and then sell the goods to their customers on credit. These companies sometimes have
difficulty repaying their suppliers when customers who buy on credit don't pay on time. Firms that
experience this difficulty need to do a better job of:
302. In the
Making Ethical Decisions
box titled "Would You Cook the Books?" the situation
provides the student with an ethical dilemma that might present itself to an accounting
professional. The story focuses on: Is it ethical to __________________________
303. As Hector was packing to return to State University after his summer vacation, he
realized that he owned many valuable things such as a laptop computer, a stereo system, and a
DVD player. An accountant would list all of these as Hector's:
304. Keith will graduate from Southern State University this year. He has accumulated $18,000
in student loans during his four years at college. An accountant would classify the loans as:
305. The balance sheet for Renuvation LLC shows assets totaling $107,000 and liabilities
totaling $75,000. Which of the following statements is correct?
306. When reviewing the balance sheet for Preferred Pet Care, Inc., a mobile small animal care
business, Julian noted the following information: Company assets totaling $3.5 million, and
liabilities totaling $1.3 million. On paper, the net worth (owners' equity) for this business =
___________.
307. Scott Drilling Contractors recently issued a corporate bond on which it expects to pay
interest for the next twenty years. Scott would record this as a __________ on its balance sheet.
308. Meg Malloy is running an income statement on her QuickBooks computer accounting
program. Which of the following accounts will be used to calculate gross profit?
309. At the time the Jepson Plumbing Supply prepared its financial statements, it had several
customers who bought goods over the past three months on its "90 days same as cash" credit
plan. These customers had not yet paid their bills, but they have good credit ratings and Jepson is
confident that they will make their payments on time. The amount these credit customers owe
would show up as part of the:
310. Green Living Construction Company installs solar panels in large newly constructed
buildings. The company employs several expert installers who work on a full-time basis. Although
the installers work every day, the company pays them at the end of the month, for the previous
month's work. Employee salaries are recorded as ___________ on Green Living's balance sheet.
311. Lisa is preparing her homework for her accounting class. She is uncertain as to the
proper handling of patents and copyrights on a firm's financial statements. Which of the following
is correct?
312. McCartney Consulting Group is a management-consulting firm that provides its expertise
to businesses that employ its services. Since it does not hold an inventory of goods or produce
any goods itself:
313. Cindy is concerned because during the past four months her company has experienced
difficulty in paying its bills on time. She knows if this continues, the firm will have difficulties in
accomplishing its goals. Cindy is concerned with:
314. Monica noted that she disbursed $6,347 in payments for operations in her travel agency
and received $6,189 in cash receipts for services rendered. She had no cash receipts or
disbursements from investments or financing activities. Thus, Monica had a:
315. Similar to the example of FIFO and LIFO inventory accounting methods, a college store
purchased sweatshirts for the upcoming fall semester. Using the following data, where a total of
100 sweatshirts were purchased by the store and placed in inventory, select the correct
statement from the following choices.
316. Nebraska Communications is considering the purchase of a new satellite. The firm
believes the satellite will help generate future earnings. In addition, the firm recognizes the tax
benefits of a lower net income provided by the annual ________ of the asset.
317. Carole Grand and Bonnie Lamore run a shuttle service from Western Illinois to the busy
Chicago O'Hare airport. Last month, they recorded the following:
Carole and Bonnie's gross profit for the past month was:
318. Carole Grand and Bonnie Lamore run a shuttle service from Western Illinois to the busy
Chicago O'Hare airport. Last month, they recorded the following:
If 25% of their net income is paid to the government in taxes, what is their net income after
taxes?
319. Costas Calendar Company's Statement of Cash Flows showed the following activities for
the year ended December 31, 2016:
The year-end cash balance for this firm is:
320. The financial ratios that measure a firm's ability to pay its short-term debts are called:
321. The current ratio is a type of ________ ratio.
322. Which of the following ratios is a liquidity ratio?
323. The purpose of the current ratio is to evaluate the firm's ability to:
324. The _______ ratio helps determine the ability of a firm to repay its short-term debts even
if it has difficulty selling its inventory.
