Question 1

K2 Corporation has assets of $2,400,000, common stock of $624,000, and retained earnings of $380,000. What are the creditors' claims on their assets?

Accepted Answer

A)  $2,156,000 
B)  $1,004,000 
C)  $1,396,000 
D)  $2,644,000 
A)  $2,156,000 
B)  $1,004,000 
C)  $1,396,000 
D)  $2,644,000

Question 2

Information that is presented in a clear fashion, so that users of that information can interpret it is an example of

Accepted Answer

A)  relevance. 
B)  faithful representation. 
C)  understandability. 
D)  comparability. 
A)  relevance. 
B)  faithful representation. 
C)  understandability. 
D)  comparability.

Question 3

Declaring a cash dividend will

Accepted Answer

A)  increase retained earnings. 
B)  decrease retained earnings. 
C)  increase common stock. 
D)  decrease common stock. 
A)  increase retained earnings. 
B)  decrease retained earnings. 
C)  increase common stock. 
D)  decrease common stock.

Question 4

The current ratio takes into account the composition of current assets.

Accepted Answer

A) True 
 B)False

Question 5

(Communication)
Sunshine Sugar grows sugar cane in Florida, California, and Hawaii. Its investment in land to grow sugar exceeds $2 million. Currently, land whose original cost was more than $300,000 in Florida is threatened by plans to flood the Everglades to reclaim the wetlands. Sunshine plans to fight vigorously to keep its land in production, particularly because most of the rest of its land is in California, which is threatened by water shortages. The land in Florida is also significantly more productive than that in California, and the wages paid to workers to process the sugar cane are substantially less. Current plans include litigation to prevent government seizure of the land, an extensive public education campaign, and intense lobbying efforts.
Required:
Sunshine has determined that a footnote disclosure should be made in the financial statements to alert the investors of the threat to the land. Carefully consider how much of the above information is appropriate for inclusion in the footnote. Write the footnote.

Accepted Answer

NOTE: A portion of the most valuable lan

Question 6

On a classified balance sheet, companies usually list current assets

Accepted Answer

A)  in alphabetical order. 
B)  with the largest dollar amounts first. 
C)  in the order in which they are expected to be converted into cash. 
D)  in the order of acquisition. 
A)  in alphabetical order. 
B)  with the largest dollar amounts first. 
C)  in the order in which they are expected to be converted into cash. 
D)  in the order of acquisition.

Question 7

Long-term creditors are usually most interested in evaluating

Accepted Answer

A)  liquidity and profitability. 
B)  consistency and profitability. 
C)  liquidity and solvency. 
D)  consistency and solvency. 
A)  liquidity and profitability. 
B)  consistency and profitability. 
C)  liquidity and solvency. 
D)  consistency and solvency.

Question 8

Which accounting assumption assumes that an enterprise will continue in operation long enough to carry out its existing objectives and commitments?

Accepted Answer

A)  Monetary unit assumption 
B)  Economic entity assumption 
C)  Periodicity assumption 
D)  Going concern assumption 
A)  Monetary unit assumption 
B)  Economic entity assumption 
C)  Periodicity assumption 
D)  Going concern assumption

Question 9

The following information is available for Bradshaw Corporation and Newell Corporation:   Based on this information, which of the following is suggested by the earnings per share calculations (rounded to two decimals) and the information given?

Accepted Answer

A)  There is lower performance in 2013 than in 2014 for Newell Corporation. 
B)  There is higher performance in 2013 than in 2014 for Newell Corporation. 
C)  There are fewer earnings available to Newell's common stockholders in 2014 than in 2013. 
D)  There is a decrease in preferred shares of stock in 2014 as compared with 2013. 
A)  There is lower performance in 2013 than in 2014 for Newell Corporation. 
B)  There is higher performance in 2013 than in 2014 for Newell Corporation. 
C)  There are fewer earnings available to Newell's common stockholders in 2014 than in 2013. 
D)  There is a decrease in preferred shares of stock in 2014 as compared with 2013.

Question 10

The classified balance sheet is

Accepted Answer

A)  required under GAAP but not under IFRS. 
B)  required under IFRS in the same format as under GAAP. 
C)  required under IFRS but not under GAAP. 
D)  required under IFRS with certain variations in format as compared to GAAP. 
A)  required under GAAP but not under IFRS. 
B)  required under IFRS in the same format as under GAAP. 
C)  required under IFRS but not under GAAP. 
D)  required under IFRS with certain variations in format as compared to GAAP.

Question 11

The following items are taken from the financial statements of Tracy Company for 2014:   Instructions
(a) Calculate the net income.
(b) Calculate the retained earnings balance that would appear on a balance sheet at December 31, 2014
(c) Prepare a classified balance sheet for Tracy Company at December 31, 2014 assuming the note payable is a long-term liability.
(d) Compute the current ratio, debt to assets ratio, and earnings per share value. The average number of shares outstanding for 2014 was 10,000.

Accepted Answer

The answer of The following items are taken from the...

Question 12

Equipment is classified on the balance sheet as

Accepted Answer

A)  a current asset. 
B)  property, plant, and equipment. 
C)  an intangible asset. 
D)  a long-term investment. 
A)  a current asset. 
B)  property, plant, and equipment. 
C)  an intangible asset. 
D)  a long-term investment.

Question 13

Using the following balance sheet and income statement data, what is the debt to assets ratio?   Average common shares outstanding was 10,000.

Accepted Answer

A)  20.5 percent 
B)  30 percent 
C)  33.3 percent 
D)  40.9 percent 
A)  20.5 percent 
B)  30 percent 
C)  33.3 percent 
D)  40.9 percent

Question 14

Liabilities are generally classified on a balance sheet as

Accepted Answer

A)  small liabilities and large liabilities. 
B)  present liabilities and future liabilities. 
C)  tangible liabilities and intangible liabilities. 
D)  current liabilities and long-term liabilities. 
A)  small liabilities and large liabilities. 
B)  present liabilities and future liabilities. 
C)  tangible liabilities and intangible liabilities. 
D)  current liabilities and long-term liabilities.

Question 15

What are three of the five enhancing qualities of useful information.

Accepted Answer

The FASB and IASB describe the

Question 16

Using the following balance sheet and income statement data, what is the current ratio?   Average common shares outstanding was 10,000.

Accepted Answer

A)  0.78 : 1 
B)  3.33 : 1 
C)  0.57 : 1 
D)  1.75: 1 
A)  0.78 : 1 
B)  3.33 : 1 
C)  0.57 : 1 
D)  1.75: 1

Question 17

Which of the following is not considered an asset?

Accepted Answer

A)  Equipment 
B)  Dividends 
C)  Accounts receivable 
D)  Inventory 
A)  Equipment 
B)  Dividends 
C)  Accounts receivable 
D)  Inventory

Question 18

The following information is available for Cooke Corporation:   What is the net increase in cash and equivalents?

Accepted Answer

A)  $1,700 
B)  $1,280 
C)  $730 
D)  $2,250 
A)  $1,700 
B)  $1,280 
C)  $730 
D)  $2,250

K2 Corporation has assets of $2,400,000, common stock of $624,000, and retained earnings of $380,000. What are the creditors' claims on their assets?

Information that is presented in a clear fashion, so that users of that information can interpret it is an example of

Declaring a cash dividend will

The current ratio takes into account the composition of current assets.

On a classified balance sheet, companies usually list current assets

Long-term creditors are usually most interested in evaluating

Which accounting assumption assumes that an enterprise will continue in operation long enough to carry out its existing objectives and commitments?

The following information is available for Bradshaw Corporation and Newell Corporation: Based on this information, which of the following is suggested by the earnings per share calculations (rounded to two decimals) and the information given?

The classified balance sheet is

Equipment is classified on the balance sheet as

Using the following balance sheet and income statement data, what is the debt to assets ratio? Average common shares outstanding was 10,000.

Liabilities are generally classified on a balance sheet as

What are three of the five enhancing qualities of useful information.

Using the following balance sheet and income statement data, what is the current ratio? Average common shares outstanding was 10,000.

Which of the following is not considered an asset?

The following information is available for Cooke Corporation: What is the net increase in cash and equivalents?

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

Time Value of Money

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Exam 2: A Further Look at Financial Statements

K2 Corporation has assets of $2,400,000, common stock of $624,000, and retained earnings of $380,000. What are the creditors' claims on their assets?

Information that is presented in a clear fashion, so that users of that information can interpret it is an example of

Declaring a cash dividend will

The current ratio takes into account the composition of current assets.

On a classified balance sheet, companies usually list current assets

Long-term creditors are usually most interested in evaluating

Which accounting assumption assumes that an enterprise will continue in operation long enough to carry out its existing objectives and commitments?

The following information is available for Bradshaw Corporation and Newell Corporation: Based on this information, which of the following is suggested by the earnings per share calculations (rounded to two decimals) and the information given?

The classified balance sheet is

Equipment is classified on the balance sheet as

Using the following balance sheet and income statement data, what is the debt to assets ratio? Average common shares outstanding was 10,000.

Liabilities are generally classified on a balance sheet as

What are three of the five enhancing qualities of useful information.

Using the following balance sheet and income statement data, what is the current ratio? Average common shares outstanding was 10,000.

Which of the following is not considered an asset?

The following information is available for Cooke Corporation: What is the net increase in cash and equivalents?

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

Time Value of Money

Filters