Question 1

Using the following balance sheet and income statement data, what is the total amount of working capital?   Average common shares outstanding was 15,000.

Accepted Answer

A) $8,000 
B) $32,000 
C) $10,000 
D) $16,000 
A) $8,000 
B) $32,000 
C) $10,000 
D) $16,000 D

Question 2

Use the following data to determine the total dollar amount of assets to be classified as property, plant, and equipment.

Accepted Answer

A) $990,000 
B) $525,000 
C) $735,000 
D) $585,000 
A) $990,000 
B) $525,000 
C) $735,000 
D) $585,000 B

Question 3

The monetary unit assumption states that transactions that can be measured in terms of money should be recorded in the accounting records.

Accepted Answer

A) True 
 B)False  True

Question 4

Suppose that Morgan Corporation produced and sold 4,800 laptop computers during 2022.It reported $130,000 cash provided by operating activities.In order to maintain production at 4,800 laptops, Morgan invested in $8,600 in equipment.Morgan paid $1,400 in dividends.What is Morgan's free cash flow?

Accepted Answer

A) $120,000 
B) $140,000 
C) $137,000 
D) $130,000 
A) $120,000 
B) $140,000 
C) $137,000 
D) $130,000

Question 5

Which statement about long-term investments is not true?

Accepted Answer

A) They will be held for more than one year. 
B) They are not currently used in the operation of the business. 
C) They include investments in stock of other companies and land held for future use. 
D) They do not include long-term notes receivable. 
A) They will be held for more than one year. 
B) They are not currently used in the operation of the business. 
C) They include investments in stock of other companies and land held for future use. 
D) They do not include long-term notes receivable.

Question 6

Consistent use of the same accounting principles and methods is necessary for meaningful analysis of trends within a company.

Accepted Answer

A) True 
 B)False

Question 7

Use the following data to determine the total dollar amount of assets to be classified as investments.

Accepted Answer

A) $0 
B) $320,000 
C) $180,000 
D) $280,000 
A) $0 
B) $320,000 
C) $180,000 
D) $280,000

Question 8

Earnings available to common stockholders is equal to

Accepted Answer

A) total revenues 
B) net income + preferred dividends. 
C) preferred dividends - net income. 
D) net income - preferred dividends. 
A) total revenues 
B) net income + preferred dividends. 
C) preferred dividends - net income. 
D) net income - preferred dividends.

Question 9

The assumption that requires that only those things that can be expressed in money are included in the accounting records is the

Accepted Answer

A) economic entity assumption. 
B) monetary unit assumption. 
C) going concern assumption. 
D) periodicity assumption. 
A) economic entity assumption. 
B) monetary unit assumption. 
C) going concern assumption. 
D) periodicity assumption.

Question 10

Use the following data to determine the total dollar amount of assets to be classified as current assets.

Accepted Answer

A) $855,000 
B) $600,000 
C) $510,000 
D) $435,000 
A) $855,000 
B) $600,000 
C) $510,000 
D) $435,000

Question 11

What is the order in which assets are generally listed on a classified balance sheet?

Accepted Answer

A) Current and long-term 
B) Current; property, plant and equipment; long-term investments; intangibles 
C) Current; property, plant and equipment; intangibles; long-term investments 
D) Current; long-term investments; property, plant and equipment, intangibles 
A) Current and long-term 
B) Current; property, plant and equipment; long-term investments; intangibles 
C) Current; property, plant and equipment; intangibles; long-term investments 
D) Current; long-term investments; property, plant and equipment, intangibles

Question 12

Long-term creditors consider a high free cash flow amount an indication of solvency.

Accepted Answer

A) True 
 B)False

Question 13

Which of the following organizations issues accounting standards for countries outside the United States?

Accepted Answer

A) SEC 
B) GAAP 
C) IASB 
D) FASB 
A) SEC 
B) GAAP 
C) IASB 
D) FASB

Question 14

The principle that indicates that assets should be reported at the price that would be received to sell the asset is the

Accepted Answer

A) historical cost principle. 
B) fair value principle. 
C) full disclosure principle. 
D) consistency principle. 
A) historical cost principle. 
B) fair value principle. 
C) full disclosure principle. 
D) consistency principle.

Question 15

A major function of management is to provide the accountant with relevant and useful information.

Accepted Answer

A) True 
 B)False

Question 16

The debt to assets ratio measures the percentage of assets financed by creditors.

Accepted Answer

A) True 
 B)False

Question 17

Characteristics associated with faithfully representative accounting information are

Accepted Answer

A) verifiable and timely. 
B) verifiable and neutral. 
C) complete and neutral. 
D) relevance and verifiable. 
A) verifiable and timely. 
B) verifiable and neutral. 
C) complete and neutral. 
D) relevance and verifiable.

Question 18

Kingery Corporation has current assets of $1,800,000 and current liabilities of $750,000.If they pay $350,000 of their accounts payable, what will their new current ratio be?

Accepted Answer

A) 3.6:1 
B) 2.4:1 
C) 4.5:1 
D) 2.0:1 
A) 3.6:1 
B) 2.4:1 
C) 4.5:1 
D) 2.0:1

Question 19

The economic entity assumption states that economic events can be identified with a particular unit of accountability.

Accepted Answer

A) True 
 B)False

Question 20

Using the following balance sheet and income statement data, what is the debt to assets ratio?   Average common shares outstanding was 15,000.

Accepted Answer

A) 26 percent 
B) 13 percent 
C) 65 percent 
D) 35 percent 
A) 26 percent 
B) 13 percent 
C) 65 percent 
D) 35 percent

Using the following balance sheet and income statement data, what is the total amount of working capital? Average common shares outstanding was 15,000.

Use the following data to determine the total dollar amount of assets to be classified as property, plant, and equipment.

The monetary unit assumption states that transactions that can be measured in terms of money should be recorded in the accounting records.

Suppose that Morgan Corporation produced and sold 4,800 laptop computers during 2022.It reported $130,000 cash provided by operating activities.In order to maintain production at 4,800 laptops, Morgan invested in $8,600 in equipment.Morgan paid $1,400 in dividends.What is Morgan's free cash flow?

Which statement about long-term investments is not true?

Consistent use of the same accounting principles and methods is necessary for meaningful analysis of trends within a company.

Use the following data to determine the total dollar amount of assets to be classified as investments.

Earnings available to common stockholders is equal to

The assumption that requires that only those things that can be expressed in money are included in the accounting records is the

Use the following data to determine the total dollar amount of assets to be classified as current assets.

What is the order in which assets are generally listed on a classified balance sheet?

Long-term creditors consider a high free cash flow amount an indication of solvency.

Which of the following organizations issues accounting standards for countries outside the United States?

The principle that indicates that assets should be reported at the price that would be received to sell the asset is the

A major function of management is to provide the accountant with relevant and useful information.

The debt to assets ratio measures the percentage of assets financed by creditors.

Characteristics associated with faithfully representative accounting information are

Kingery Corporation has current assets of $1,800,000 and current liabilities of $750,000.If they pay $350,000 of their accounts payable, what will their new current ratio be?

The economic entity assumption states that economic events can be identified with a particular unit of accountability.

Using the following balance sheet and income statement data, what is the debt to assets ratio? Average common shares outstanding was 15,000.

Introduction to Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Understanding Investments in Debt and Equity Securities

Filters

Exam 2: A Further Look at Financial Statements

Using the following balance sheet and income statement data, what is the total amount of working capital? Average common shares outstanding was 15,000.

Use the following data to determine the total dollar amount of assets to be classified as property, plant, and equipment.

The monetary unit assumption states that transactions that can be measured in terms of money should be recorded in the accounting records.

Suppose that Morgan Corporation produced and sold 4,800 laptop computers during 2022.It reported $130,000 cash provided by operating activities.In order to maintain production at 4,800 laptops, Morgan invested in $8,600 in equipment.Morgan paid $1,400 in dividends.What is Morgan's free cash flow?

Which statement about long-term investments is not true?

Consistent use of the same accounting principles and methods is necessary for meaningful analysis of trends within a company.

Use the following data to determine the total dollar amount of assets to be classified as investments.

Earnings available to common stockholders is equal to

The assumption that requires that only those things that can be expressed in money are included in the accounting records is the

Use the following data to determine the total dollar amount of assets to be classified as current assets.

What is the order in which assets are generally listed on a classified balance sheet?

Long-term creditors consider a high free cash flow amount an indication of solvency.

Which of the following organizations issues accounting standards for countries outside the United States?

The principle that indicates that assets should be reported at the price that would be received to sell the asset is the

A major function of management is to provide the accountant with relevant and useful information.

The debt to assets ratio measures the percentage of assets financed by creditors.

Characteristics associated with faithfully representative accounting information are

Kingery Corporation has current assets of $1,800,000 and current liabilities of $750,000.If they pay $350,000 of their accounts payable, what will their new current ratio be?

The economic entity assumption states that economic events can be identified with a particular unit of accountability.

Using the following balance sheet and income statement data, what is the debt to assets ratio? Average common shares outstanding was 15,000.

Introduction to Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations and the Multiple-Step Income Statement

Reporting and Analyzing Inventory

Fraud, Internal Control, and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Stockholders Equity

Statement of Cash Flows

Financial Analysis: The Big Picture

Understanding Investments in Debt and Equity Securities

Filters