Deck 1: Accounting

Question 1

Larry's accounts show the following for the year:
Net Sales on Account: $200,000
COGS: $150,000
Accounts Receivable at the beginning of the year: $22,500
Accounts Receivable at year end: $17,500
Inventory at the beginning of the year: $45,000
Inventory at the end of the year: $55,000
What is the accounts receivable turnover ratio for the year?

A)10
B)4
C)2.5
D)5
E)There is not enough information to compute the turnover ratio.

Answer 1

10

Question 2

Ken's Canaries shows the following balances in the books:
Common Stock: $200,000
Paid in Capital in Excess of Par: $20,000
Retained Earnings: $95,000
Treasury Stock: $10,000
What is the total stockholder's equity?

A)$335,000
B)$220,000
C)$305,000
D)$295,000
E)$210,000

Answer 2

$305,000

Question 3

If $5,000,000 in 7% bonds are issued at 104 ½, how much cash is generated from the sale?

A)$1,040,000
B)$1,000,000
C)$5,000,000
D)$5,225,000
E)$3,500,000

Answer 3

$5,225,000

Question 4

If Big Bertha's Birds purchases a family owned canary breeding farm for $150,000 and the family retained 12.21%, what is the minority interest that is put on the balance sheet?

A)$21,581
B)$18,315
C)$150,000
D)$131,685
E)$12,210

Question 5

Bertha has the following accounts:
Accounts Receivable: $10,000
Land: $20,000
Cash: $22,000
Intangible Assets: $12,500
Inventory: $33,000
Equipment: $99,000
Prepaid Expenses: $10,000
Based on this information, what is the amount of Bertha's quick assets?

A)$206,500
B)$65,000
C)$60,000
D)$32,000
E)$42,000

Question 6

If a corporation issues a 10-year $100,000 8% bond, what is the total that the issuing corporation pays to the bondholder over the next 10 years?

A)$80,000
B)$140,000
C)$180,000
D)$100,000
E)$200,000

Question 7

Cartman's Cats had a total of 100,000 shares of common stock issued. In February, they reacquired 20,000 shares and did not retire them. How many shares of outstanding stock do they currently have?

A)100,000
B)120,000
C)20,000
D)60,000
E)80,000