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
Current liabilities
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.
The balance sheet is prepared on a particular date.
Interim statements are generally prepared quarterly.
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:
Accounts receivable, inventory, cash equivalents
Marketable securities, accounts payable, property, plant and equipment
Prepaid expenses, goodwill, long-term investments
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.
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.
below market value.
equal to market value.
cautiously.
Question 12 5 / 5 points
Which of the following statements is true?
Question options:
Land should be depreciated over the period of time it benefits the firm.
Accelerated depreciation must be used for financial reporting purposes.
Fixed assets are reported at historical cost plus accumulated depreciation.
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
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.
When the firm donates property to charities.
When it is determined that there has been a loss of value of long-term assets.
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
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:
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.
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