| Question 1 | 5 / 5 points |
__________ include those assets expected to be converted into cash within one year or operating cycle.
Question options:
|
| Current assets | ||
|
| Long-term assets | ||
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| Current liabilities | ||
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| Long-term liabilities | ||
| Question 2 | 5 / 5 points | ||
Use the information below to answer the following question.
ABC Company purchases five products for sale in the order and at the costs shown below.
| Unit | Cost per Unit |
| 1 | $10 |
| 2 | $12 |
| 3 | $15 |
| 4 | $18 |
| 5 | $13 |
Assume ABC sells two items and uses the FIFO method of inventory valuation. What amount would appear in ending inventory on the balance sheet?
Question options:
|
| $22 | ||
|
| $46 | ||
|
| $45 | ||
|
| $31 | ||
| Question 3 | 5 / 5 points | ||
Which of the following statements is FALSE?
Question options:
|
| Annual reports must include three-year audited balance sheets and two-year audited income statements. | ||
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| The balance sheet is prepared on a particular date. | ||
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| Interim statements are generally prepared quarterly. | ||
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| When a parent company owns more than 50% of the voting stock of a subsidiary, the financial statements are consolidated for both entities. | ||
| Question 4 | 0 / 5 points | ||
A decline in __________ when sales are increasing is a red flag that the firm is NOT collecting cash from its customers.
Question options:
|
| accrued liabilities | ||
|
| inventories | ||
|
| accounts payable | ||
|
| accounts receivable | ||
| Question 5 | 5 / 5 points | ||
Which of the following accounts would be classified as current assets on the balance sheet?
Question options:
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| Accounts receivable, inventory, cash equivalents | ||
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| Marketable securities, accounts payable, property, plant and equipment | ||
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| Prepaid expenses, goodwill, long-term investments | ||
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| Property, plant and equipment, inventory, goodwill | ||
| Question 6 | 5 / 5 points | ||
Assume the following purchases of inventory for ABC Company and use this information to answer the question below.
ABC Company purchases five products for sale in the order and at the costs shown below.
| Purchase # | Purchase Price |
| 1 | $3 |
| 2 | $4 |
| 3 | $5 |
| 4 | $6 |
| 5 | $7 |
Assume ABC sells two items and uses the FIFO method of inventory valuation. What amount would appear in ending inventory on the balance sheet?
Question options:
|
| $7 | ||
|
| $15 | ||
|
| $18 | ||
|
| $25 | ||
| Question 7 | 5 / 5 points | ||
__________ is based on an assumption regarding the flow of goods and has nothing to do with the actual order in which products are sold.
Question options:
|
| Assets | ||
|
| Inventory valuation | ||
|
| Short-term debt | ||
|
| Liabilities | ||
| Question 8 | 5 / 5 points | ||
When analyzing accounts receivable and the allowance for doubtful accounts it is helpful to assess the relationship between __________, accounts receivable, and the allowance for doubtful accounts.
Question options:
|
| short-term liabilities | ||
|
| long-term liabilities | ||
|
| the growth rates of sales | ||
|
| accounts payable | ||
| Question 9 | 5 / 5 points | ||
The balancing equation is expressed as:
Question options:
|
| Assets + Liabilities = Stockholders' Equity. | ||
|
| Revenues – Expenses = Net Income. | ||
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| Sales – Costs = Net Profit. | ||
|
| Assets = Liabilities + Stockholders' Equity. | ||
| Question 10 | 5 / 5 points | ||
Which method of inventory would be least likely to be used by a European firm?
Question options:
|
| FIFO | ||
|
| LIFO | ||
|
| Average cost | ||
|
| LIFO and FIFO | ||
| Question 11 | 5 / 5 points | ||
Marketable securities should be valued:
Question options:
|
| at fair market value. | ||
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| below market value. | ||
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| equal to market value. | ||
|
| cautiously. | ||
| Question 12 | 5 / 5 points | ||
Which of the following statements is true?
Question options:
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| Land should be depreciated over the period of time it benefits the firm. | ||
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| Accelerated depreciation must be used for financial reporting purposes. | ||
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| Fixed assets are reported at historical cost plus accumulated depreciation. | ||
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| The total amount of depreciation over the asset's life is the same regardless of depreciation method, although the rate of depreciation varies. | ||
| Question 13 | 5 / 5 points | ||
__________ is (are) a form of vertical ratio analysis that allows for comparison of firms with different levels of sales or total assets by introducing a common denominator.
Question options:
|
| Consolidated statements | ||
|
| Common size financial statements | ||
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| Income Statements | ||
|
| Comparative Data Statements | ||
| Question 14 | 5 / 5 points | ||
When will a firm regard goodwill on its books?
Question options:
|
| When one company acquires another company for a price in excess of the fair market value of the net identifiable assets acquired. | ||
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| When the firm donates property to charities. | ||
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| When it is determined that there has been a loss of value of long-term assets. | ||
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| When fixed assets are impaired. | ||
| Question 15 | 5 / 5 points | ||
Which items would be classified as long-term debt?
Question options:
|
| Accounts payable, unearned revenue, pension liabilities | ||
|
| Common stock, retained earnings, bonds payable | ||
|
| Mortgages, convertible debentures, bonds payable | ||
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| Deferred taxes, accrued expenses, treasury stock | ||
| Question 16 | 5 / 5 points | ||
Assume the following purchases of inventory for ABC Company and use this information to answer the question below.
ABC Company purchases five products for sale in the order and at the costs shown below.
| Purchase # | Purchase Price |
| 1 | $3 |
| 2 | $4 |
| 3 | $5 |
| 4 | $6 |
| 5 | $7 |
Assume ABC sells three items and uses the LIFO method of inventory valuation. What amount would appear for cost of goods sold on the income statement?
Question options:
|
| $18 | ||
|
| $12 | ||
|
| $15 | ||
|
| $25 | ||
| Question 17 | 5 / 5 points | ||
Which method of inventory assumes the last units purchased will remain in ending inventory on the balance sheet?
Question options:
|
| FIFO | ||
|
| LIFO | ||
|
| Average cost | ||
|
| LIFO and FIFO | ||
| Question 18 | 5 / 5 points | ||
__________ are the combined financial statements of separate legal entities when the parent controls 100% of the subsidiary.
Question options:
|
| Income statements | ||
|
| Balance sheet statements | ||
|
| Consolidated statements | ||
|
| Stockholder's equity statements | ||
| Question 19 | 5 / 5 points | ||
Marketable securities are also referred to as __________ investments.
Question options:
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| guaranteed | ||
|
| high risk/low return | ||
|
| long-term | ||
|
| short-term | ||
| Question 20 | 5 / 5 points | ||
The balance sheet shows the financial position of a company:
Question options:
|
| for a month. |
|
| for a quarter. |
|
| for a year. |
|
| for a particular date. |
