Info
Warning
Danger

Study Resources (Financial Accounting)

10.Prepare a trend analysis of the following data, using Year 1 as the base year. Place your answers in the chart provided. Comment on the trend. Year 3Year 2Year 1 Net sales$324,000$330,000$300,000 Net income33,00031,80030,000 Year 3Year 2Year 1 Net sales Net income 11.Prepare a horizontal analysis by computing the amounts and percentage changes for the following balance.
164 Views
View Answer
21.Most companies issue interim financial statements to the public on a monthly basis. 22.Interim financial statements report data for a period of more than one year. 23.One of the main parts of an annual report of a publicly held corporation is the five- to ten-year projection. 24.Reports made to the SEC by public.
133 Views
View Answer
41.The receivable turnover and inventory turnover ratios are used to analyze a.leverage. b.long-term solvency. c.profitability. d.liquidity. 42.Days' inventory on hand is used to analyze a.cash flow adequacy. b.liquidity. c.profitability. d.long-term solvency. 43.Which of the following describes the interest coverage ratio? a.Income before income taxes plus interest expense divided by interest expense b.Income after income taxes plus interest expense divided by interest expense c.Income.
136 Views
View Answer
29.Use the following information to calculate the ratios requested below. Round answers to two decimal places. Show your work. Return on assetsInventory turnover Price/earnings (P/E) ratioInterest coverage ratio 30.Use the following information to calculate the ratios requested below. Round answers to two decimal places. Show your work. Return on assetsInventory turnover Price/earnings (P/E) ratioInterest coverage.
165 Views
View Answer
5.The Mahola Company operates as three autonomous divisions. Each division has a general manager in charge of product development, production, and distribution. Management recently adopted total quality management and the divisions now track, record, and analyze their costs and nonfinancial measures of quality. All three divisions are competing in a.
135 Views
View Answer
21.Using the following information from an annual report, prepare a vertical analysis of the consolidated balance sheet at June 30, 20xx. (Round percentage answers to one decimal place.) June 30, 20xx (In millions) Cash and cash equivalents$   584 Accounts and other receivables182 Merchandise inventories2,027 Prepaid expenses and other current assets80 Total current assets$2,873 Real estate, net$2,342 Other, net2,113 Total property.
166 Views
View Answer
61.Days' payable is a measure of a.liquidity. b.volatility. c.long-term solvency. d.profitability. 62.The following information pertains to Jasmin Corporation. Assume that all balance sheet amounts represent both average and ending figures. Jasmin Corporation Partial Balance Sheet December 31, 20xx Liabilities and Stockholders' Equity Current liabilities$ 60,000 Long-term liabilities90,000 Stockholders' equity150,000 Total liabilities and stockholders' equity$300,000 Jasmin Corporation Income Statement For the Year Ended December 31, 20xx Net sales$80,000 Cost.
170 Views
View Answer
10.The Trial Balance and Adjusted Trial Balance columns of Roland Cleaning Corporation's work sheet are shown below. (The Adjustments columns have been omitted.) In the journal provided, prepare the seven adjusting entries and the four closing entries for the month ended June 30, 2010. Omit explanations. Account NameTrial BalanceAdjusted Trial Balance DebitCreditDebitCredit Cash2,6002,600 Accounts Receivable380400 Prepaid.
176 Views
View Answer
4.Contrast the circumstances where horizontal analysis would be an effective analysis tool with those where common-sized analysis would be more useful. 5.The following selected amounts were extracted from the financial statements of Flamingo Corporation. Year 4Year 3Year 2Year 1 Net sales$175,000$170,000$165,000$150,000 Cost of goods sold109,000104,500100,50093,000 Gross margin66,00065,50064,50057,000 Prepare a trend analysis for net sales, cost of.
173 Views
View Answer
31.In a common-size financial statement, a designation of 25 percent could not be given to a.total stockholders' equity. b.net revenues. c.net earnings. d.total current assets. 32.Ratios are most useful in identifying a.causes. b.differences. c.relationships. d.trends. 33.A common measure of liquidity is a.profit margin. b.receivable turnover. c.return on assets. d.asset turnover. 34.A common measure of profitability is the a.asset turnover. b.debt to equity ratio. c.current ratio. d.receivable turnover. 35.A common measure.
132 Views
View Answer
5.Regal Kitchens, Inc., is considering the production of a new kitchen vent system. The Marketing Department has determined that there would be demand for the product at or below a selling price of $150 per unit. Anticipated unit costs are as follows: Direct materials$26.00 Direct labor costs Manufacturing Hours2.2 Hourly rate$12.00 Assembly Hours2.5 Hourly rate$10.00 Machine hours2 Regal uses the.
134 Views
View Answer
8.Using the following information and the trial balance accounts and balances on the work sheet provided, complete the work sheet. a. Expired insurance totals $150. b. Of the unearned revenue, all has been earned by the balance sheet date. c. Estimated depreciation of equipment is $120. d. Accrued wages equal $300. e. Unused supplies on.
167 Views
View Answer
TRUE/FALSE 1.Many traditional management information systems do not produce meaningful results for today's business environment. 2.Traditional management information systems focus on financial reporting. 3.A management information system can be designed to support many different types of management philosophies. 4.The primary focus of a management information system is management of costs. 5.A management information system is.
128 Views
View Answer
51.What is the effect of the payment of an account payable on the current ratio and the quick ratio, respectively? (Assume the current ratio was 2.3 times and the quick ratio was 2.1 times before this transaction.) a.Decrease in current ratio; no effect on quick ratio b.Increase in current ratio; increase in.
166 Views
View Answer
11.Internal failure costs and prevention costs make up the costs of conformance. 12.External failure costs are the costs incurred after the product is shipped or the service is delivered to the customer. 13.Cost control concerns have largely been replaced with concern for nonfinancial measures in JIT settings. 14.The key to good quality control.
133 Views
View Answer
11.An amount would not appear along the Dividends account line in which of the following work sheet columns? a.Income Statement b.Balance Sheet c.Trial Balance d.Adjusted Trial Balance 12.An important reason to use a work sheet is to a.aid the accountant in the daily preparation of journal entries. b.replace the journal when making adjusting and closing entries. c.check the.
175 Views
View Answer
14.Given the following information, calculate the payables turnover and days' payable. Round answers to two decimal places. a. Payables turnover b. Days' payable 15.a. Indicate the effect of a sale of merchandise on account (on credit) on each of the following items. Assume the selling price exceeds the cost of the inventory. Use.
169 Views
View Answer
31.Use the following information to calculate the ratios requested below. Round answers to two decimal places. Show your work. Dividends yieldDebt to equity ratio Current ratioAsset turnover 32.Use the following information to calculate the ratios requested below. Round answers to two decimal places. Show your work. Dividends yieldDebt to equity ratio Current ratioAsset turnover .
168 Views
View Answer
27.Financial statements for Boston Corporation are presented below. Boston Corporation Comparative Balance Sheet December 31 Assets20102009 Cash$   120,000$   110,000 Accounts receivable (net)135,00095,000 Inventory270,000240,000 Property, plant, and equipment (net)750,000800,000 Total assets$1,275,000   $1,245,000 Liabilities and Stockholders' Equity Accounts payable$   152,000$   208,000 Accrued liabilities12,00016,000 Bonds payable, 10 percent160,000160,000 Common stock, $10 par500,000500,000 Retained earnings451,000361,000 Total liabilities and stockholders' equity$1,275,000   $1,245,000 Boston Corporation Income Statement For the Year Ended December 31, 2010 Net sales$1,200,000 Cost of goods.
172 Views
View Answer
7.Using the income statement below, develop a common-size statement by filling in the blanks provided. Show your work. Round to one decimal place. 20xx20xx Net sales$200,000_________ Cost of goods sold116,000_________ Gross margin$  84,000_________ Operating expenses46,000_________ Income before income taxes$  38,000_________ Income taxes expense15,200_________ Net income$  22,800     _________ 8.Using the income statement below, develop a common-size statement by filling in the.
167 Views
View Answer
9.Seven years ago, Jared Singh formed the Singh Corporation and began producing computer equipment for home use. Because of the highly technical and competitive nature of the industry, Singh established a research and development division that is responsible for continuous evaluation and updating of critical electronic parts used in all.
132 Views
View Answer
25.After each of the following transactions is a ratio. Mark an X in the appropriate space to indicate the effect of the transaction on the ratio. TransactionRatioEffect IncreaseDecreaseNone a.Declaration of cash dividend.Quick ratio b.Paid an account payable.Current ratio c.Wrote off an account receivable.Receivable turnover d.Collected an account receivable.Return on assets e.Sold merchandise on account.Current ratio f.Recorded utilities expense.Profit.
176 Views
View Answer
21.In a common-size income statement for a retail store, the 100 percent amount is for a.net revenues. b.cost of goods sold. c.gross profit. d.net income. 22.In a common-size balance sheet for a retail store, the 100 percent amount is for a.merchandise inventory. b.total property, plant, and equipment. c.total assets. d.total current assets. 23.In a trend analysis, an index number of.
128 Views
View Answer
TRUE/FALSE 1.It is in the best interests of a company to base executive compensation on a single performance measure. 2.Per the Sarbanes-Oxley Act of 2002, a compensation committee, comprised of a public corporation's top executives, must be established to determine the salaries and wages of its employees. 3.Per the Sarbanes-Oxley Act of 2002,.
130 Views
View Answer
7.Using the following information and the trial balance accounts and balances on the work sheet provided, complete the work sheet. a. Expired insurance totals $16. b. Of the unearned revenue, all has been earned by the balance sheet date. c. Estimated depreciation of equipment is $12. d. Accrued wages equal $8. e. Unused supplies on.
175 Views
View Answer
21.Erin Stover has been appointed chief accountant for Dancer Industries. The company has three divisions that manufacture floor tiles. The industry is very competitive, and Dancer Industries has lost market share in each of the last four years. Three years ago, management announced a companywide restructuring and the adoption of.
133 Views
View Answer
21.Which of the following is the most useful aid to the accountant in preparing closing entries? a.Ledger b.Work sheet c.Journal d.Financial statements 22.A work sheet is useful for all except which of the following? a.Recording transactions from source documents b.Recording closing entries c.Recording adjusting entries d.Preparing financial statements 23.An amount for Retained Earnings would not appear in which of the.
178 Views
View Answer
  1.Does the existence of conglomerates make financial performance evaluation easier or more difficult? Why? 2.Lois Kent has owned and managed the operations of a small chain of sporting goods stores for the past two years. She has asked her administrative assistant to provide her with some annual reports of other companies.
173 Views
View Answer
11.Dun & Bradstreet publishes a.data on average ratios and relationships. b.credit ratings of companies. c.data on industry norms. d.all of these. 12.Within a few days of certain major events, a report must be issued by publicly held corporations to a.stockholders. b.the SEC. c.Dun & Bradstreet. d.creditors. 13.Publicly held corporations must file annual reports with the SEC. All such reports are.
136 Views
View Answer
  MULTIPLE CHOICE 1.Use this information from the Income Statement columns of the work sheet of Corner Laundry Service to answer the following question. Income Statement DebitCredit Laundry Revenue2,500 Wages Expense750 Rent Expense500 Supplies Expense300 Insurance Expense200 Income Taxes Expense50 1,8002,500 Net Income700 2,5002,500 The entry to close the Laundry Revenue account includes a a.Laundry Revenue 2,500 Income Summary  2,500 b.Income Summary 2,500 Laundry Revenue  2,500 c.Retained Earnings 2,500 Income.
166 Views
View Answer
6.Linda Klein is the chief accountant for Hogan Industries. The company has three divisions that manufacture wind velocity gauges. The industry is very competitive, and Hogan Industries has lost market share in each of the last four years. Three years ago, management announced a companywide restructuring and the adoption of.
133 Views
View Answer
TRUE/FALSE 1.The process of crossfooting requires vertical addition and subtraction. 2.Despite the many uses of microcomputers, they cannot be used to prepare work sheets. 3.A work sheet is more useful for a small company than for a large one. 4.Working papers provide a written record of the work performed by the accountant. 5.The work sheet.
173 Views
View Answer
23.Using the following information reported in an annual report, prepare a horizontal analysis of the consolidated balance sheets. (Round percentage answers to one decimal place.) (In millions)June 30, 2010June 30, 2009 Cash and cash equivalents$   584$   410 Accounts and other receivables182204 Merchandise inventories2,0271,902 Prepaid expenses and other current assets80    81 Total current assets$2,873$2,597 Real estate, net$2,342$2,354 Other, net2,113 1,872 Total property.
175 Views
View Answer
11.Financial statement analysis can be both past- and future-oriented. 12.The use of rule-of-thumb measures is not an exact science and should be used with great care. 13.Rule-of-thumb measures are the best standards of comparison in financial performance evaluation. 14.A limitation of using industry norms in financial performance evaluation is that some companies in.
131 Views
View Answer
  SHORT ANSWER 1.Presented below are the Retained Earnings, Dividends, and Income Summary accounts for Anika's Pet Grooming Boutique, Inc., for the year ended December 31, 2010. Closing entries have been entered and posted. Prepare a statement of retained earnings. 2.Prepare closing entries for December from the following Income Statement columns of the.
164 Views
View Answer
  SHORT ANSWER 1.Identify and describe three traits that differentiate management information systems (MIS) from traditional management accounting techniques. 2.The following statement appears in the annual report of Ryan, Inc., for the year ended January 1, 2008: “We are confident that our ever-increasing emphasis on customer service will enhance our reputation as the.
126 Views
View Answer
18.Why is the quick ratio probably better than the current ratio as a measure of short-term liquidity? 19.For 20xx, Black & White Corporation had average total assets of $300,000, net sales of $250,000, net income of $20,000, net cash flows from operating activities of $30,000, dividend payments of $15,000, purchases of.
167 Views
View Answer
31.A change in the company's auditors must be reported to the SEC within a few days of the change. 32.Vertical analysis will result in common-size statements. 33.Trend analysis requires the establishment of a base year for comparison purposes. 34.Vertical analysis is the same as common-size analysis. 35.Horizontal analysis will reveal the percentage of net.
129 Views
View Answer
7.Management of Mountain Berry Industries has just decided to employ a set of transfer prices for intracompany transfers between departments. The objective is to include return on assets as part of the performance evaluation of managers of the various cost centers. Data from the Molding Department for the past six.
130 Views
View Answer
51.Days' payable measures the relative size of accounts payable. 52.Asset turnover is most closely associated with a company's liquidity position. 53.Both profit margin and asset turnover affect a company's return on assets. 54.The cash flow yield equals net income divided by net cash flows from operating activities. 55.Declining profitability and liquidity ratios are indications.
133 Views
View Answer
21.In the new manufacturing environment, the point of sale and shipment of a product ends the management accountant's responsibility with respect to the product. 22.Service businesses cannot measure the quality of their work. 23.Benchmarking and process mapping are two methods to measure quality. 24.Quality in manufacturing simply means a product has to be.
137 Views
View Answer
4.Travis Morgan is the chief accountant for Hill Industries. The company has three divisions that manufacture computer disk drives. The industry is very competitive, and Hill Industries has lost market share in each of the last four years. Three years ago, management announced a companywide restructuring and the adoption of.
133 Views
View Answer
  MULTIPLE CHOICE 1.The primary focus of a management information system is on the management of a.people. b.costs. c.activities. d.time. 2.Information captured by a management information system allows managers to do all of the following except a.determine accurate product or service costs. b.improve processes. c.provide timely feedback. d.satisfy all customer inquiries. 3.How does an ERP system differ from an MIS? a.The ERP system.
127 Views
View Answer
  MULTIPLE CHOICE 1.Executive officers' compensation is typically comprised of all of the following except a.incentive bonuses. b.declared dividends. c.stock option awards. d.annual base salaries. 2.Market strength refers most closely to the ability to a.survive for many years. b.pay bills when they fall due. c.earn a satisfactory net income. d.increase the wealth of stockholders. 3.The ability to pay bills when due and.
191 Views
View Answer
11.CAD is a.a cost allocating decision. b.computer aided downtime. c.a computer-based engineering system. d.an organizational environment. 12.When a firm changes to a JIT operating and management philosophy, a.it attempts to increase the number of suppliers it has for each item it uses to ensure a reliable flow of materials into the production process. b.it seeks out the.
131 Views
View Answer
31.Internal reports on quality at the Acme Publishing Company generated the following information for the Trade Division for the first three months of the year: Total sales$1,000,000 Costs of quality: Prevention22,500 Appraisal47,000 Internal failure36,000 External failure64,000 Compute the costs of nonconformance as a percentage of total sales. a.12.0% b.5.4% c.1.3% d.10% 32.Which of the following specific measures of vendor quality would be.
130 Views
View Answer
5.From the following items in the Income Statement columns of the work sheet of Antin Corporation at December 31, 2010, prepare the closing entries, assuming that a $50 dividend was paid during the period (omit explanations). Income Statement DebitCredit Service Revenue3,000 Wages Expense1,800 Rent Expense600 Supplies Expense300 Income Taxes Expense150 Depreciation Expense–Building250 3,1003,000 Net Loss100 3,1003,100 General JournalPage 1 Date DescriptionPost. Ref. Debit Credit 6.The Trial Balance and.
163 Views
View Answer