Question 1

If cash flows from operating activities were $1,000, cash flows for financing activities were $12,500, and the net increase in cash was $15,000, how much are cash flows from investing activities?

Accepted Answer

A)  $1,500. 
B)  $28,500. 
C)  $3,500. 
D)  $26,500.

Question 2

For each financial statement item listed below, identify the best description by selecting from items a through f below.You may use each letter more than once or not at all.Write the letter 'X' for each item for which no description is listed.
-Retained earnings

Accepted Answer

A)  Amount of net income or loss less distributions to the owners of the company 
B)  Must be settled within one year 
C)  Converted to cash within one year 
D)  Amount of owners' investment 
E)  Portion of equity to which dividends reduce
F) Land used as a site for production

Question 3

For each financial statement item listed in below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all.
-Prepaid insurance

Accepted Answer

A)  Current assets 
B)  Long-term investments 
C)  Property, plant, and equipment 
D)  Intangible assets 
E)  Current liabilities
F) Long-term liabilities
G) Shareholders' equity
H) Not disclosed on the balance sheet

Question 4

Following are several items from Simmons Company's financial statements.Use this information to calculate the amounts for the questions that follow.

A.	Calculate the dollar amount of net income.
B.	How much is inventory expense? 
C.	Was the company profitable during the current year? How do you know?

Accepted Answer

The answer of Following are several items from Simmons Company's...

Question 5

Legacy Company has total assets, liabilities, and shareholders' equity of $30,000, $17,000, and $13,000, respectively at the beginning of 2010.If Legacy reports revenues of $125,000, expenses of $85,000, and pays dividends of $30,000, how much is shareholders' equity at the end of 2010?

Accepted Answer

A)  $23,000 
B)  $53,000 
C)  $44,000 
D)  Not enough information to determine.

Question 6

For each item numbered below, identify which accounting element(s) listed in A through H each statement describes.You may use each letter more than once or not at all.
-Total past earnings not distributed to the owners

Accepted Answer

A)  Assets 
B)  Liabilities 
C)  Contributed capital 
D)  Retained earnings 
E)  Revenues
F) Expenses
G) Net income
H) Dividends

Question 7

For items select the appropriate section of the balance sheet in which the item would be reported.
-Amounts owed for purchasing inventory from creditors (due next month).

Accepted Answer

A)  Long-term Investments 
B)  Property, Plant, & Equipment 
C)  Current Liabilities 
D)  Long-term Liabilities 
E)  Shareholders' Equity

Question 8

For each financial statement item listed below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all.
-Retained earnings

Accepted Answer

A)  Current assets 
B)  Long-term investments 
C)  Property, plant, and equipment 
D)  Intangible assets 
E)  Current liabilities
F) Long-term liabilities
G) Shareholders' equity
H) Not disclosed on the balance sheet

Question 9

The following is the balance sheet of Cleveland Corporation immediately prior to deciding how to finance the purchase of an additional $200,000 parcel of land.
‪  
REQUIRED: Cleveland will finance the $200,000 investment in land by issuing either $200,000 of common stock or using $200,000 of additional accounts payable that will be due in 90 days.Indicate which method of financing is preferable for Cleveland.Consider the effects on short-term solvency positions.

Accepted Answer

The answer of The following is the balance sheet of...

Question 10

For each item numbered below, identify which accounting element(s) listed in A through H each statement describes.You may use each letter more than once or not at all.
-That which will be used to generate future economic benefits

Accepted Answer

A)  Assets 
B)  Liabilities 
C)  Contributed capital 
D)  Retained earnings 
E)  Revenues
F) Expenses
G) Net income
H) Dividends

Question 11

For items select the appropriate section of the balance sheet in which the item would be reported.
-Cumulative profits retained by the company since operations began.

Accepted Answer

A)  Long-term Investments 
B)  Property, Plant, & Equipment 
C)  Current Liabilities 
D)  Long-term Liabilities 
E)  Shareholders' Equity

Question 12

For each financial statement item listed in below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all.
-Sales revenue

Accepted Answer

A)  Current assets 
B)  Long-term investments 
C)  Property, plant, and equipment 
D)  Intangible assets 
E)  Current liabilities
F) Long-term liabilities
G) Shareholders' equity
H) Not disclosed on the balance sheet

Question 13

Valley Company has retained earnings of $12,000, total assets totaling $38,000, and total liabilities of $20,000.How much is total shareholders' equity?

Accepted Answer

A)  $6,000 
B)  $12,000 
C)  $18,000 
D)  $32,000

Question 14

For each financial statement item listed in below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all.
-Contributed capital

Accepted Answer

A)  Current assets 
B)  Long-term investments 
C)  Property, plant, and equipment 
D)  Intangible assets 
E)  Current liabilities
F) Long-term liabilities
G) Shareholders' equity
H) Not disclosed on the balance sheet

Question 15

For each financial statement item listed in below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all.
-Accounts payable

Accepted Answer

A)  Current assets 
B)  Long-term investments 
C)  Property, plant, and equipment 
D)  Intangible assets 
E)  Current liabilities
F) Long-term liabilities
G) Shareholders' equity
H) Not disclosed on the balance sheet

Question 16

For each financial statement item listed below, identify the best description by selecting from items a through f below.You may use each letter more than once or not at all.Write the letter 'X' for each item for which no description is listed.
-The property part of property, plant, and equipment

Accepted Answer

A)  Amount of net income or loss less distributions to the owners of the company 
B)  Must be settled within one year 
C)  Converted to cash within one year 
D)  Amount of owners' investment 
E)  Portion of equity to which dividends reduce
F) Land used as a site for production

Question 17

For each financial statement item listed below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all.
-Prepaid insurance

Accepted Answer

A)  Current assets 
B)  Long-term investments 
C)  Property, plant, and equipment 
D)  Intangible assets 
E)  Current liabilities
F) Long-term liabilities
G) Shareholders' equity
H) Not disclosed on the balance sheet

Exam 2: The Financial Statementsa Closer Look

If cash flows from operating activities were $1,000, cash flows for financing activities were $12,500, and the net increase in cash was $15,000, how much are cash flows from investing activities?

For each financial statement item listed below, identify the best description by selecting from items a through f below.You may use each letter more than once or not at all.Write the letter 'X' for each item for which no description is listed. -Retained earnings

For each financial statement item listed in below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all. -Prepaid insurance

Following are several items from Simmons Company's financial statements.Use this information to calculate the amounts for the questions that follow. A. Calculate the dollar amount of net income. B. How much is inventory expense? C. Was the company profitable during the current year? How do you know?

Legacy Company has total assets, liabilities, and shareholders' equity of $30,000, $17,000, and $13,000, respectively at the beginning of 2010.If Legacy reports revenues of $125,000, expenses of $85,000, and pays dividends of $30,000, how much is shareholders' equity at the end of 2010?

For each item numbered below, identify which accounting element(s) listed in A through H each statement describes.You may use each letter more than once or not at all. -Total past earnings not distributed to the owners

For items select the appropriate section of the balance sheet in which the item would be reported. -Amounts owed for purchasing inventory from creditors (due next month) .

For each financial statement item listed below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all. -Retained earnings

For each item numbered below, identify which accounting element(s) listed in A through H each statement describes.You may use each letter more than once or not at all. -That which will be used to generate future economic benefits

For items select the appropriate section of the balance sheet in which the item would be reported. -Cumulative profits retained by the company since operations began.

For each financial statement item listed in below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all. -Sales revenue

Valley Company has retained earnings of $12,000, total assets totaling $38,000, and total liabilities of $20,000.How much is total shareholders' equity?

For each financial statement item listed in below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all. -Contributed capital

For each financial statement item listed in below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all. -Accounts payable

For each financial statement item listed below, identify the best description by selecting from items a through f below.You may use each letter more than once or not at all.Write the letter 'X' for each item for which no description is listed. -The property part of property, plant, and equipment

For each financial statement item listed below, identify in which balance sheet category (listed in a through h) it should be reported.You may use each letter more than once or not at all. -Prepaid insurance