The journal entry to record a credit sale ignoring cost of goods sold is
a.Cash
Sales Revenue
b.Cash
Service Revenue
c.Accounts Receivable
Sales Returns and Allowances
d.Accounts Receivable
Sales Revenue
On January 15, Nifty Company sells merchandise on account to Martinez Associates for
$3,000 with terms 3/10, n/30. On January 20, Martinez returns merchandise worth $600
to Nifty. On January 24, payment is received from Martinez for the balance due. What
is the amount of cash received?
a.$2,400
b.$2,328
c.$2,310
d.$1,680
The internal control standards applicable to Sarbanes-Oxley apply to?
a.all U.S.and international companies.
b.U.S. and international companies listed on U.S. exchange.
c.International companies listed on U.S. exchange.
d.U.S. companies listed on U.S. exchange.
Which of the following is meaningful comparison to assess a company’s profitability?
a.An intracompany comparison of net income for a two-year period
b.Industry-average comparison of total assets
c.Year-to-year comparisons of liabilities with a competitor in the same industry
d.Intercompany comparisons of earnings per share for a two-year period
Patrick Mazzeo has been offered the opportunity of investing $89,278.45 now. The
investment will earn 8% per year and at the end of its life will return $250,000 to
Patrick. How many years must Patrick wait to receive the $250,000?
a.10~11
b.11~12
c.12~13
d.13~14
During which of the following phases does a company generate the largest amount of
operating activities?
a.Introductory phase
b.Maturity phase
c.Decline phase
d.Growth phase
Which one of the following is true as it relates to the Accumulated Depreciation
account?
a.It is a contra account.
b.It is offset against an asset account on the income statement.
c.It represents the portion of the cost of a long-lived asset that has been allocated as a
cost during the current accounting period.
d.It is an operating expense.
Companies cannot use the
a.periodic inventory system under GAAP.
b.periodic inventory system under IFRS.
c.perpetual system under IFRS.
d.None of these answer choices are correct.
Green Realty Company received a check for $30,000 on July 1 which represents a 6
month advance payment of rent on a building it rents to a client. Unearned Rent
Revenue was credited for the full $30,000. Financial statements will be prepared on
July 31. Green Realty should make the following adjusting entry on July 31:
a.debit Unearned Rent Revenue, $5,000; credit Rent Revenue, $5,000.
b.debit Rent Revenue, $5,000; credit Unearned Rent Revenue, $5,000.
c.debit Unearned Rent Revenue, $30,000; credit Rent Revenue, $30,000.
d.debit Cash, $30,000; credit Rent Revenue, $30,000.
Outstanding stock of the West Corporation included 40,000 shares of $5 par common
stock and 10,000 shares of 6%, $10 par non-cumulative preferred stock. In 2013, West
declared and paid dividends of $4,000. In 2014, West declared and paid dividends of
$12,000. How much of the 2014 dividend was distributed to preferred shareholders?
a.$8,000.
b.$14,000.
c.$6,000.
d.None of these answer choices are correct.
Bertram Corporation had net income of $325,000 and paid dividends to common
stockholders of $50,000 in 2014. The weighted average number of shares outstanding in
2014 was 50,000 shares. Bertram Corporation’s common stock is selling for $45.50 per
share on the New York Stock Exchange. Bertram Corporation’s payout ratio for 2014 is
a.$6.5 per share.
b.18%.
c.15.4%.
d.40%.
A comparative balance sheet for the Beneteau Corporation is presented below:
Additional information:
1)Net loss for 2014 is $12,000. Net sales for 2014 are $250,000.
2)Cash dividends of $15,000 were declared and paid in 2014.
3)Land was sold for cash at a loss of $2,000. This was the only land transaction during
the year.
4)Equipment with a cost of $15,000 and accumulated depreciation of $10,000 was sold
for $5,000 cash.
5)$12,000 of bonds were retired during the year at carrying (book) value.
6)Equipment was acquired for common stock. The fair value of the stock at the time of
the exchange was $25,000.
Instructions
1)Prepare a statement of cash flows for the year ended 2014 using the indirect method.
2)Compute the following cash based ratios:
a.Current cash debt coverage
b.Cash debt coverage
What is the goal when a company is selecting a depreciation method?
a.To select a method that best measures an asset′s contribution to revenue over its life
b.To select a method that allows the least amount of income taxes to be paid
c.To select the method that is required by GAAP for each particular asset
d.To select a method that measures the asset in units of output
Sassy Saxophones has the following inventory data:
Assuming that a periodic inventory system is used, what is the amount allocated to
ending inventory on a LIFO basis.
a.$10,992
b.$11,022
c.$23,088.
d.$23,118
To what is the current market value of bonds equal when determining their issue price?
a.The present value of the bonds future cash flows
b.The sum of the future interest payments, plus the principal payment when the bonds
mature
c.The difference between the face value of the bonds and the contractual interest rate
d.The cash that will be paid to the investor when the bonds mature