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Study Resources (Accounting)

Learning Objective 11.1 Questions 1) Consolidated financial statements A) are used to offset gains and losses on the parent company's income statement. B) combine the financial records of two or more separate legal entities. C) make clear distinctions between principal and secondary long-term asset owners. D) provide a depiction of process costs. E) must provide predetermined.
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22) Florenza Establishment had 2,500,000 shares of common stock authorized. Shares issued were 1,050,000. There were 50,000 shares in treasury. a. How many shares have been sold to shareholders? b. How many shares are outstanding? c. How many shares are unissued? d. If the company declared a $2.00 per share cash dividend on January.
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Learning Objective 10.7 Questions 1) What type of account is the Treasury stock and Additional paid-in capital? A) Treasury stock Additional paid-in capital retained earnings retained earnings B) Treasury stock Additional paid-in capital asset contra stockholders' equity C) Treasury stock Additional paid-in capital contra stockholders' equity stockholders' equity D) Treasury stock Additional paid-in capital common stock contra stockholders' equity E).
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29) Comparative balance sheets are available for Floatlin Group: Floatlin Group Comparative Balance Sheets December 31, 2X13 and 2X12 2X132X122X13 2X12 Current Assets: Current Liabilities: Cash $ 20$ 15Accounts Payable $ 24 $ 20 Accounts Receivable 4537Taxes Payable 1115 Inventory 6070Note Payable 718 Total Current Assets $125$122Total Current Liab. $ 42$ 53 Long-Term Assets: Long-Term Liabilities 8030 Equipment $290$200Total Liabilities $122$.
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11) Manchester Technology has the following data available: Inventory, December 31, 2013 $120 Inventory, December 31, 2012 $200 What is the percentage increase or (decrease) in inventory from 2012 to 2013 for Manchester Technology? A) (120.0)% B) 120.0% C) 40.0% D) 62.5% E) (40.0)% 12) What issue would be of most concern on behalf of banks or other creditors.
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20) Elltol Company Ingrad Company Balance Sheet Balance Sheet January 1, 2X13 January 1, 2X13 Cash $ 40 Cash $120 Net Fixed Assets 90 Net Fixed Assets 130 Total Assets $130 Total Assets $250 Accounts Payable $ 20 Accounts Payable $ 30 Long-term Bonds Payable 60 Long-term Bonds Payable 100 Stockholders' Equity 50 Stockholders' Equity 120 Total Liab. &.
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14) The following selected information is available for Lindale Corp., as of December 31, 2X13: Additional Paid-in Capital, Common $1,050,000 Additional Paid-in Capital, Preferred 150,000 Common Stock, $1 par, 1,000,000 shares authorized, 480,000 shares issued ? Dividends Payable 280,000 Long-term Investment in the Broomfield Company 400,000 Marketable Securities 60,000 Retained Earnings 1,800,000 Treasury Stock, Common, 20,000 shares 500,000 10% Cumulative.
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19) State the appropriate accounting term for each of the definitions given below. a) A written authority granted by individual shareholders to others to cast the shareholders' votes. b) The right to acquire a proportional amount of any new issues of common stock. c) The aggregate number of shares that can be issued. d).
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11) Milton Manufacturing manufactures and sells ornamental statues. Because of good styling and marketing, sales have grown briskly. Milton has no pre-existing deferred tax liability. During 20X3, the following transactions occurred: 1. On January 1, 20,000 new shares of common stock were sold at $100 per share. 2. Half of the proceeds.
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Learning Objective 12.4 Questions 1) Xemen Company has the following data: 2X13                            2X12         2X11 Sales $ 930 $700 Less: Cost of Goods Sold 410 235 Gross Profit 520 465 Less: Operating Expenses 284 255 Operating Income 236 210 Less: Other Revenue/Other Expense: Interest Revenue 24 24 Interest Expense (30) (30) Income before Tax 230 204 Less: Income Tax Expense 92 82 Net Income.
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32) On September 1, 2X12, Yelter Oil purchased trading securities consisting of common and preferred stocks. The portfolio consists of: Company # of shares purchase price/share market value (9/30/2X12) Haring 400 $24 $20 Jacker 200 $16 $19 What will be the net gain or loss recorded on Yelter Oil's income statement for the quarter.
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Learning Objective 10.3 Questions 1) Which of the following statements is NOT true regarding common and preferred stock? A) Common stock is the most basic and common type of stock. B) All corporations issue common stock. C) Preferred stock owners do not usually have voting rights. D) Preferred stockholders have priority over common stockholders regarding.
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Learning Objective 9.5 Questions 1) Accounting for postretirement benefits requires A) no liability on the balance sheet. B) no journal entries because the benefits are to be paid in the future. C) the recognition of a liability equal to the present value of the expected payments for other postretirement benefits. D) the recognition of a.
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Learning Objective 11.3 Questions 1) Bond discounts are amortized by taking the difference between the A) interest based on the effective interest rate and the interest based on the coupon interest rate. B) interest based on the nominal interest rate and the interest based on the coupon interest rate. C) interest based on the.
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Learning Objective 10.2 Questions 1) The total number of shares that may be issued by a corporation is known as A) issued shares. B) authorized shares. C) outstanding shares. D) treasury shares. E) preferred shares. 2) Those shares which have been sold to outside investors at one time or another are known as A) authorized shares. B) issued shares. C).
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Learning Objective 10.8 Questions 1) Joino Manufacturing issued 2,000 shares of $100 par 9% convertible preferred stock for $112 per share. Each share of preferred stock can be converted into 8 shares of $2 par value common stock. On June 20, 2X13, 300 shares of preferred stock were converted when the.
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Learning Objective 9.7 Questions 1) A company has a debt-to-equity ratio of 150%. The more debt a company has, and the less stockholders' equity, the A) greater the probability that the company will report a contingency. B) lower the probability that the company will report a contingency. C) riskier it is to lend money.
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26) Floatlin Company has the following income statements available: Floatlin Company Comparative Statements of Income For the Years Ending December 31, 2X13 and 2X12 2X132X12 Sales $750 $690 Cost of Goods Sold 440 400 Gross Profit $310 $290 Less: Operating Expenses 220 205 Operating Income $ 90 $ 85 Less: Income Tax Expense 40 37 Net Income $ 50 $ 48 Determine.
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Learning Objective 9.6 Questions 1) A deferred income tax liability A) arises because of differences between U.S. income tax rules and foreign income tax rules. B) can arise because of "permanent" and "temporary" differences. C) arise because managers wish to maximize taxable income. D) can arise when a firm uses special accelerated depreciation for tax.
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22) Kendall Corporation has 600,000 shares authorized and 150,000 shares issued and outstanding of its $4 par value common stock. The stock is currently selling for $50 per share. There is $900,000 of additional paid-in capital and the firm has $3,000,000 of retained earnings. Prepare the appropriate journal entry for Kendall.
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21) Debt security investments include short-term obligations of banks and short-term notes payable issued by large corporations with top credit ratings. 22) Trading securities include both debt and equity securities. 23) The accounting for investments differs depending upon the purpose of the investment. 24) Held-to-maturity securities are equity securities that the company purchases.
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Learning Objective 11.6 Questions 1) ________ represent the rights of nonmajority shareholders in the assets and earnings of a company that is consolidated into the accounts of its majority shareholder. A) Parent interests B) Noncontrolling interests C) Subsidiary interests D) Consolidated interests E) Intercompany interests 2) Presented below are the balance sheets of Blanco, Inc. and Stalle.
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Learning Objective 12.5 Questions 1) Big Apple Cabins has net income of $725,000. Throughout the year, the company had 150,000 shares of common stock outstanding. Also, the company has 25,000 shares of preferred stock that pay a dividend of $5.00 per share that is convertible into 5 shares of common stock.
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11) Montreal Electronics has the following data available: 2013                                2012 Net Income $ 90 $ 80 Earnings Per Share $ .45 $ .40 Annual Common Dividends Per Share $ .40 $ .20 Closing Market Price Common Stock, 12/31 $9.00 $6.00 What is the dividend-payout for Montreal Electronics in 2013? Has the dividend-payout increased or decreased since.
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7) Fruit King Company purchased 100% of the outstanding common shares of Berries, Inc., for $23,750 on January 1, 2X13. Berries Inc.'s balance sheet just before the acquisition was as follows: Cash $ 4,500 Net fixed assets 12,000 Total Assets $16,500 Liabilities $11,000 Stockholders' equity 5,500 Total Liabilities & Stockholders' Equity $16,500 The fair market value of Berries.
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Learning Objective 10.4 Questions 1) Restricted stock has the benefit of A) increasing in value when stock prices fall. B) decreasing in value when stock prices fall. C) retaining some value even if stock prices fall. D) being retained for three additional years past the original purchase date. E) being used as treasury stock. 2) Which of.
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11) When comparing preferred stock to common stock and bonds, which of the following is incorrectly stated? A) Preferred stock and bonds have a specific maturity date. B) Both bonds and preferred stock pay a specific return to the investor. C) Both preferred stock and common stock can pay dividends. D) Both preferred stock.
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Learning Objective 9.4 Questions 1) Which of the following statements is FALSE? A) The lessee will always record the liability associated with future cash payments but never an asset associated with the property being leased. B) Leases can take the form of a capital lease or an operating lease. C) Some leases are substantially.
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11) Presented below are the balance sheets of Tallton Company and Handel Company at January 1, 2X13: Handel Company               Tallton Company Balance Sheet Balance Sheet January 1, 2X13 January 1, 2X13 Cash $ 70 Cash $240 Net Fixed Assets 210 Net Fixed Assets 210 Total Assets $280Total Assets $450 Accounts Payable $ 20 Accounts Payable $.
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Learning Objective 10.1 Questions 1) By using ________, shareholders may express (vote) their preference without traveling to the site of the annual meeting. A) a preemptive right B) a corporate proxy C) a stock option D) a stock split E) a stock dividend 2) A preemptive right is A) the right of stockholders to acquire a proportional amount.
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21) Cider Company has the following data: 2X13                               2X12      2X11 Current Liabilities: Accounts Payable $ 50 $ 30 $ 20 Wages Payable 20 10 5 Taxes Payable 10 5 15 Current Long-Term Debt 10 15 5 Total Current Liabilities $ 90 $ 60 $ 45 Long-Term Liabilities: Long-Term Debt 35 45 40 Total Liabilities $125 $105 $ 85 Stockholders' Equity: Common Stock.
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Learning Objective 12.2 Questions 1) Fulton Company has the following data available: Wage Expense, For the Year Ending December 31, 2X13 $95 Wage Expense, For the Year Ending December 31, 2X12 $90 What is the percentage increase or (decrease) in wage expense from 2X12 to 2X13 for Fulton Company? A) 5.3% B) (5.3)% C) 2.6% D) (5.6)% E) 5.6% 2).
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Learning Objective 11.4 Questions 1) Highland Cutlery acquired as a long-term investment some of the common stock of LTS Company on December 31, 2X12. During 2X13, LTS Company had net income of $300,000 and declared and paid cash dividends of $90,000. What journal entry would Highland Cutlery make for 2X13 to.
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11) Alexander Pools has 700,000 shares authorized and 250,000 shares issued and outstanding of its $4 par value common stock. The stock is currently selling for $60 per share. If Alexander Pools declared and issued a three-for-one stock split by issuing 500,000 new shares and accounts for it as a.
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Learning Objective 12.1 Questions 1) In addition to annual reports, financial information regarding a company can come from all of the following sources EXCEPT A) a company's own press releases. B) the popular press. C) stockbrokers. D) a company's Web site. E) the Internal Revenue Service. 2) When analyzing the financial statements of a potential debtor, the.
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Learning Objective 9.8 Questions 1) The amount earned by an investor expressed as a percentage of the amount invested is called A) discount rate. B) rate of return. C) present value. D) future value. E) expected past rate. 2) An amount that is calculated by multiplying an interest rate by a principal amount that is increased each.
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37) Based on the information for the following three companies, a) compute the number of days' sales in receivables for 2X13 for each company assuming 365 days in a year and b) analyze each company in accordance with a 45-day credit policy. Hadman Teltor Comdok Net credit sales 2X13 $122,000 $98,000 $178,000 2X12.
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33) The following financial statements are available for Jerry Company: Comparative Income Statements For the Years Ending December 31, 2X13 and 2X12 2X13 2X12 Sales(all credit) $750 $690 Cost of Goods Sold 440 400 Gross Profit $310 $290 Less: Operating Expenses 220 205 Operating Income $ 90 $ 85 Less: Income Tax Expense 40 37 Net Income $ 50 $.
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Learning Objective 12.6 Questions 1) Over the Top, Inc. sells one of its four swing sets. The company regularly sells seasonal outdoor furniture. How shall the gain on the sale be classified on the income statement? A) Extraordinary item B) Ordinary income C) Accounting Change D) Discontinued Operation E) Recapture 2) It is now 2X09 and Jump.
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11) Short-term liquidity refers to an organization's ability to generate enough cash to repay long-term debts as they mature. 12) Long-term solvency refers to an organization's ability to meet current payments as they become due. 13) Annual reports and 10K filings for the Securities and Exchange Commission are timely, since they usually.
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11) Eleston Printing acquired the following short-term equity securities on January 1, 2X12: Company # of Shares Price/share Total Cost Color, Inc. 250$22$ 5,500 Black, Inc. 300226,600 White, Inc. 50014    7,000 $19,100 The quarter-end prices per share were as follows: Compan03/31/2X1206/30/2X1209/30/2X1212/31/2X12 Color, Inc. $23 $21 $22$21 Black, Inc. 2420 2324 White, Inc. 1514 13 13 Eleston Printing considers Color, Inc. stock.
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Learning Objective 11.7 Questions 1) Presented below are the balance sheets of Dental Works and Forgash Company at January 1, 2X13: Dental Works Forgash Company Balance Sheet Balance Sheet January 1, 2X13 January 1, 2X13 Cash $ 23 Cash $110 Net Fixed Assets 127 Net Fixed Assets 290 Total Assets $150 Total Assets $400 Accounts Payable $ 15.
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Learning Objective 12.3 Questions 1) How is working capital calculated? A) (total current assets) minus (total current liabilities) B) (total current assets) minus (inventories and prepaid assets) C) (total current assets) divided by (total current liabilities) D) (total current assets) E) (total current liabilities) 2X13 2X12 Sales               $999               $800 Cost of Goods Sold               $399               $336 Gross.
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