Question 1

Which of the following is not a characteristic of an extraordinary item?

Accepted Answer

A)  Material in amount. 
B)  Nonrecurring. 
C)  Unusual given the nature of the firm's activities. 
D)  Requires a cash outflow. 
A)  Material in amount. 
B)  Nonrecurring. 
C)  Unusual given the nature of the firm's activities. 
D)  Requires a cash outflow.

Question 2

Which of the following is not one of Porter's five forces?

Accepted Answer

A)  Buyer Power 
B)  Supplier Power 
C)  Threat of Regulation 
D)  Threat of Substitutes 
A)  Buyer Power 
B)  Supplier Power 
C)  Threat of Regulation 
D)  Threat of Substitutes

Question 3

Many market participants argue that financial markets are efficient and that financial statement users cannot routinely analyze financial statements to find mispriced securities.This view would lead some to suggest that there is little value to financial statement analysis.
Required:
Provide a discussion of the role of financial statement analysis in an efficient capital market and reasons why financial statement analysis is still valuable.

Accepted Answer

1.Even if markets are perfectly efficien

Question 4

The prospectus must be filled with the ________ before the company can sell new issues of stocks or bonds
A SEC

Accepted Answer

The answer of The prospectus must be filled with the...

Question 5

Use the current asset section of the balance sheets of the El Paso Company as of January 31,2012 and 2011 presented below to answer the questions that follow.
 $$\begin{array} { l r r } 
& \mathbf { 2 0 1 2 } & \mathbf { 2 0 1 1 } \
\text { Cash and cash equivalents } & \$ 75,000 & \$ 58,800 \
\text { Trade accounts receivable, net } & 157,500 & 193,200 \
\text { Inventory } & 208,200 & 253,400 \
\text { Other current assets } & 18,400 & 15,500 \
\quad \text { Total current assets } & \$ 459,100 & \$ 520,900 \
\text { Total assets } & \$ 2,650,000 & \$ 3,430,000
\end{array}$$ 
Required:
(a)In the spaces provided below,complete a Percentage Change analysis of the current asset section of El Paso Company's balance sheet for 2012,using the following format to provide your answers for the amount of dollar change and the amount of percentage change,rounding "% Change" to one decimal place,e.g.,8.3%.
Accounts $ Change % Change
(b)Provide a short evaluation of this analysis.

Accepted Answer

(a)
 \[\begin{array} { | l | c | c | }

Question 6

Current assets are defined as

Accepted Answer

A)  Cash and cash equivalents. 
B)  All assets expected to be quickly used by the firm. 
C)  Cash and other assets that the firm expects to sell or consume during the normal operating cycle of a business, usually one year. 
D)  Cash and other assets that the firm expects maintain for a period including the normal operating cycle of a business, usually one year. 
A)  Cash and cash equivalents. 
B)  All assets expected to be quickly used by the firm. 
C)  Cash and other assets that the firm expects to sell or consume during the normal operating cycle of a business, usually one year. 
D)  Cash and other assets that the firm expects maintain for a period including the normal operating cycle of a business, usually one year.

Question 7

During 2014,Waggoner Company performed services for which customers paid or promised to pay $587,000.Of this amount,$552,000 had been collected by year end.Waggoner paid $340,000 in cash for employee wages and owed the employees $15,000 at the end of the year for work that had been done but had not paid for.Waggoner paid interest expense of $3,000 and $195,000 for other service expenses.The income tax rate was 35%,and income taxes had not yet been paid at the end of the year.Waggoner declared and paid dividends of $20,000.There were no other events that affected cash.
Required: Required:
1.What was the amount of the increase or decrease in cash during the year?
2.Prepare an income statement for Waggoner for the year (December 31 year-end).
3.Prepare a statement of cash flows for the year (December 31 year-end)

Accepted Answer

1.$552,000 - 340,000

Question 8

Assets for a particular business might include

Accepted Answer

A)  Cash, retained earnings, and accounts payable. 
B)  Cash, common shareholders' equity, and accounts receivable. 
C)  Cash, property, plant, and equipment, and accumulated other comprehensive income. 
D)  Cash, inventories, and goodwill. 
A)  Cash, retained earnings, and accounts payable. 
B)  Cash, common shareholders' equity, and accounts receivable. 
C)  Cash, property, plant, and equipment, and accumulated other comprehensive income. 
D)  Cash, inventories, and goodwill.

Question 9

Which of the following is not an activity reported in the Statement of cash Flows?

Accepted Answer

A)  Operating 
B)  Investing 
C)  Manufacturing 
D)  Financing 
A)  Operating 
B)  Investing 
C)  Manufacturing 
D)  Financing

Question 10

Labor contracts and purchase order commitments are examples of ____________________ contracts.

Accepted Answer

The answer of Labor contracts and purchase order commitments are...

Question 11

Which forces typically represent horizontal competition in a value chain?

Accepted Answer

A)  Rivalry among existing firms and supplier power. 
B)  Potential entry and buyer power. 
C)  Substitutes and potential entry. 
D)  Buyer power and supplier power. 
A)  Rivalry among existing firms and supplier power. 
B)  Potential entry and buyer power. 
C)  Substitutes and potential entry. 
D)  Buyer power and supplier power.

Question 12

Which of the following is a question an analyst would ask when assessing the quality of a firm's financial statements?

Accepted Answer

A)  Are the company's products designed to meet a specific market segment? 
B)  Has the firm integrated forward into retailing to final consumers? 
C)  Is the firm diversified across several geographical markets? 
D)  Do earnings include nonrecurring gains or losses? 
A)  Are the company's products designed to meet a specific market segment? 
B)  Has the firm integrated forward into retailing to final consumers? 
C)  Is the firm diversified across several geographical markets? 
D)  Do earnings include nonrecurring gains or losses?

Question 13

When a company sells a subsidiary or a product line on what financial statement is it reported and how is it reported?

Accepted Answer

The sale of a company's subsid

Question 14

Which of the following would not appear as a liability on the balance sheet?

Accepted Answer

A)  A labor contract 
B)  A note due to a bank 
C)  Salary due employees at year-end 
D)  Accounts payable 
A)  A labor contract 
B)  A note due to a bank 
C)  Salary due employees at year-end 
D)  Accounts payable

Question 15

The higher the value added from any activity,the higher should be the ____________________ from engaging in that activity.

Accepted Answer

The answer of The higher the value added from any...

Question 16

____________________ assets include the rights established by law or contract to the future use of property.

Accepted Answer

The answer of ____________________ assets include the rights established by...

Question 17

Which financial statement for a business would you look at to determine the company's earnings performance during an accounting period?

Accepted Answer

A)  Balance sheet. 
B)  Income statement. 
C)  Statement of cash flows. 
D)  The Management Assessment. 
A)  Balance sheet. 
B)  Income statement. 
C)  Statement of cash flows. 
D)  The Management Assessment.

Question 18

The primary purpose of the balance sheet is to:

Accepted Answer

A)  Report the current value of the business. 
B)  Measure the net income of a business up to a particular point in time. 
C)  Report the difference between cash inflows and cash outflows for the period. 
D)  Report the financial position of the reporting entity at a particular point in time. 
A)  Report the current value of the business. 
B)  Measure the net income of a business up to a particular point in time. 
C)  Report the difference between cash inflows and cash outflows for the period. 
D)  Report the financial position of the reporting entity at a particular point in time.

Question 19

Which of these would be considered Property,Plant,and Equipment?

Accepted Answer

A)  Trademark 
B)  Office Building 
C)  Factory Building 
D)  Goodwill 
A)  Trademark 
B)  Office Building 
C)  Factory Building 
D)  Goodwill

Question 20

Which of the following economic characteristics is consistent with a grocery store chain?

Accepted Answer

A)  Low barriers to entry. 
B)  High levels of research and development. 
C)  High profit margins. 
D)  Low capital intensity. 
A)  Low barriers to entry. 
B)  High levels of research and development. 
C)  High profit margins. 
D)  Low capital intensity.

Which of the following is not a characteristic of an extraordinary item?

Which of the following is not one of Porter's five forces?

The prospectus must be filled with the ________ before the company can sell new issues of stocks or bonds A SEC

Current assets are defined as

Assets for a particular business might include

Which of the following is not an activity reported in the Statement of cash Flows?

Labor contracts and purchase order commitments are examples of ____________________ contracts.

Which forces typically represent horizontal competition in a value chain?

Which of the following is a question an analyst would ask when assessing the quality of a firm's financial statements?

When a company sells a subsidiary or a product line on what financial statement is it reported and how is it reported?

Which of the following would not appear as a liability on the balance sheet?

The higher the value added from any activity,the higher should be the ____________________ from engaging in that activity.

____________________ assets include the rights established by law or contract to the future use of property.

Which financial statement for a business would you look at to determine the company's earnings performance during an accounting period?

The primary purpose of the balance sheet is to:

Which of these would be considered Property,Plant,and Equipment?

Which of the following economic characteristics is consistent with a grocery store chain?

Asset and Liability Valuation and Income Measurement

Income Flows Versus Cash Flows: Understanding the Statement of Cash Flows

Profitability Analysis

Risk Analysis

Accounting Quality

Financing Activities

Investing Activities

Operating Activities

Forecasting Financial Statements

Risk-Adjusted Expected Rates of Return and the Dividends Valuation Approach

Valuation: Cash-Flow-Based Approaches

Valuation: Earnings-Based Approaches

Valuation: Market-Based Approaches

Filters

Exam 1: Overview of Financial Reporting, financial Statement Analysis, and Valuation

Which of the following is not a characteristic of an extraordinary item?

Which of the following is not one of Porter's five forces?

The prospectus must be filled with the ________ before the company can sell new issues of stocks or bonds A SEC

Current assets are defined as

Assets for a particular business might include

Which of the following is not an activity reported in the Statement of cash Flows?

Labor contracts and purchase order commitments are examples of ____________________ contracts.

Which forces typically represent horizontal competition in a value chain?

Which of the following is a question an analyst would ask when assessing the quality of a firm's financial statements?

When a company sells a subsidiary or a product line on what financial statement is it reported and how is it reported?

Which of the following would not appear as a liability on the balance sheet?

The higher the value added from any activity,the higher should be the ____________________ from engaging in that activity.

____________________ assets include the rights established by law or contract to the future use of property.

Which financial statement for a business would you look at to determine the company's earnings performance during an accounting period?

The primary purpose of the balance sheet is to:

Which of these would be considered Property,Plant,and Equipment?

Which of the following economic characteristics is consistent with a grocery store chain?

Asset and Liability Valuation and Income Measurement

Income Flows Versus Cash Flows: Understanding the Statement of Cash Flows

Profitability Analysis

Risk Analysis

Accounting Quality

Financing Activities

Investing Activities

Operating Activities

Forecasting Financial Statements

Risk-Adjusted Expected Rates of Return and the Dividends Valuation Approach

Valuation: Cash-Flow-Based Approaches

Valuation: Earnings-Based Approaches

Valuation: Market-Based Approaches

Filters