Question 1

Between 20 × 8 and 20 × 9,the times interest earned ratio:

Accepted Answer

A)  increased. 
B)  decreased. 
C)  remained the same. 
D)  cannot be determined from the data provided. 
A)  increased. 
B)  decreased. 
C)  remained the same. 
D)  cannot be determined from the data provided.

Question 2

Marcial Company's inventory turnover for 20 × 6 was closest to:

Accepted Answer

A)  8.4 times. 
B)  10.4 times. 
C)  12.1 times. 
D)  14.8 times. 
A)  8.4 times. 
B)  10.4 times. 
C)  12.1 times. 
D)  14.8 times.

Question 3

Financial statements for Praeger Company appear below:

Accepted Answer

@#IMG-DLM& 
 @#IMG-DLM& 
Dividends during 20 × 6 totalled $4

Question 4

Larned Company's book value per share at the end of 20 × 6 was closest to:

Accepted Answer

A)  $10.00. 
B)  $16.11. 
C)  $63.89. 
D)  $70.56. 
A)  $10.00. 
B)  $16.11. 
C)  $63.89. 
D)  $70.56.

Question 5

Calculate the gross margin percentage for 20 × 4.

Accepted Answer

$200,000/$

Question 6

An increase in the market price of a company's common shares will immediately affect its:

Accepted Answer

A)  dividend yield ratio. 
B)  debt-to-equity ratio. 
C)  earnings per share of common stock. 
D)  dividend payout ratio. 
A)  dividend yield ratio. 
B)  debt-to-equity ratio. 
C)  earnings per share of common stock. 
D)  dividend payout ratio.

Question 7

Comparative financial statements for Springville Company for the last two years appear below.The market price of each share of Springville's common stock was $25 on December 31,Year 2.During Year 2,dividends of $2,000,000 were paid to preferred shareholders and $10,000,000 to common shareholders.

Accepted Answer

@#IMG-DLM& 
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Required:Compute the following for

Question 8

When computing the return on total assets,the after-tax effect of interest expense must be subtracted from net income.

Accepted Answer

A) True 
 B)False

Question 9

The following data have been taken from your company's financial records for the current year:   The price-earnings ratio is:

Accepted Answer

A)  6.0 to 1. 
B)  7.5 to 1. 
C)  8.0 to 1. 
D)  12.5 to 1. 
A)  6.0 to 1. 
B)  7.5 to 1. 
C)  8.0 to 1. 
D)  12.5 to 1.

Question 10

Andy Inc.has $15,000 in cash,$38,000 in current receivables,$18,000 in inventories,$4,000 in prepaid expenses and $40,000 in current liabilities.The company's current ratio is closest to:

Accepted Answer

A)  0.95 to 1. 
B)  1.33 to 1. 
C)  1.43 to 1. 
D)  1.88 to 1. 
A)  0.95 to 1. 
B)  1.33 to 1. 
C)  1.43 to 1. 
D)  1.88 to 1.

Question 11

Information concerning the common stock of Morris Company as of the end of the company's fiscal year is presented below.   The dividend yield ratio is closest to:

Accepted Answer

A)  11.1%. 
B)  33.3%. 
C)  50.0%. 
D)  120.0%. 
A)  11.1%. 
B)  33.3%. 
C)  50.0%. 
D)  120.0%.

Question 12

Jimbob Co.is considering ways to finance a planned business expansion after which the company will have $150,000 in earnings before interest and income taxes.The income tax rate is 30%.One alternative being considered is to issue $500,000 in new preferred shares which will carry an annual dividend rate of 8%.The company's common shareholders' equity is expected to average $500,000.What will be the return on common shareholders' equity if this alternative is taken?

Accepted Answer

A)  0%. 
B)  13%. 
C)  15%. 
D)  21%. 
A)  0%. 
B)  13%. 
C)  15%. 
D)  21%.

Question 13

The gross margin percentage is computed taking the difference between sales and cost of goods sold and then dividing the result by sales.

Accepted Answer

A) True 
 B)False

Question 14

Larosa Company's price-earnings ratio on December 31,20 × 6 was closest to:

Accepted Answer

A)  4.97. 
B)  7.10. 
C)  7.44. 
D)  22.66. 
A)  4.97. 
B)  7.10. 
C)  7.44. 
D)  22.66.

Question 15

Perlman Company had 100,000 shares of common stock and 20,000 shares of preferred stock at the end of the year just completed.Preferred shareholders received dividends totalling $140,000.Common shareholders received dividends totalling $210,000.If the dividend payout ratio for the year was 70%,then the net income for the year was:

Accepted Answer

A)  $147,000. 
B)  $287,000. 
C)  $300,000. 
D)  $440,000. 
A)  $147,000. 
B)  $287,000. 
C)  $300,000. 
D)  $440,000.

Question 16

Orantes Company's average collection period (age of receivables)for 20 × 6 was closest to:

Accepted Answer

A)  18.9 days. 
B)  24.7 days. 
C)  27.1 days. 
D)  35.5 days. 
A)  18.9 days. 
B)  24.7 days. 
C)  27.1 days. 
D)  35.5 days.

Question 17

The time interest earned ratio is calculated by dividing net income by interest expense.

Accepted Answer

A) True 
 B)False

Question 18

Eastham Company's accounts receivable were $600,000 at the beginning of the year and $800,000 at the end of the year.Cash sales for the year were $300,000.The accounts receivable turnover for the year was 5 times.Eastham Company's total sales for the year were:

Accepted Answer

A)  $800,000. 
B)  $1,300,000. 
C)  $3,300,000. 
D)  $3,800,000. 
A)  $800,000. 
B)  $1,300,000. 
C)  $3,300,000. 
D)  $3,800,000.

Question 19

Lisa Inc.'s return on common shareholders' equity for 20 × 7 was closest to:

Accepted Answer

A)  7.8%. 
B)  10.6%. 
C)  10.9%. 
D)  12.4%. 
A)  7.8%. 
B)  10.6%. 
C)  10.9%. 
D)  12.4%.

Question 20

Financial statements for AAR Company appear below:

Accepted Answer

@#IMG-DLM& 
 @#IMG-DLM& 
AAR Company paid dividends of $3.15

Between 20 × 8 and 20 × 9,the times interest earned ratio:

Marcial Company's inventory turnover for 20 × 6 was closest to:

Financial statements for Praeger Company appear below:

Larned Company's book value per share at the end of 20 × 6 was closest to:

Calculate the gross margin percentage for 20 × 4.

An increase in the market price of a company's common shares will immediately affect its:

Comparative financial statements for Springville Company for the last two years appear below.The market price of each share of Springville's common stock was $25 on December 31,Year 2.During Year 2,dividends of $2,000,000 were paid to preferred shareholders and $10,000,000 to common shareholders.

When computing the return on total assets,the after-tax effect of interest expense must be subtracted from net income.

The following data have been taken from your company's financial records for the current year: The price-earnings ratio is:

Andy Inc.has $15,000 in cash,$38,000 in current receivables,$18,000 in inventories,$4,000 in prepaid expenses and $40,000 in current liabilities.The company's current ratio is closest to:

Information concerning the common stock of Morris Company as of the end of the company's fiscal year is presented below. The dividend yield ratio is closest to:

The gross margin percentage is computed taking the difference between sales and cost of goods sold and then dividing the result by sales.

Larosa Company's price-earnings ratio on December 31,20 × 6 was closest to:

Orantes Company's average collection period (age of receivables)for 20 × 6 was closest to:

The time interest earned ratio is calculated by dividing net income by interest expense.

Eastham Company's accounts receivable were $600,000 at the beginning of the year and $800,000 at the end of the year.Cash sales for the year were $300,000.The accounts receivable turnover for the year was 5 times.Eastham Company's total sales for the year were:

Lisa Inc.'s return on common shareholders' equity for 20 × 7 was closest to:

Financial statements for AAR Company appear below:

An Introduction to Managerial Accounting and Cost Concepts

Systems Design: Job-Order Costing

Systems Design: Activity-Based Costing

Systems Design: Process Costing

Cost Behavior: Analysis and Use

Cost-Volume-Profit Relationships

Profit Planning

Standard Costs

Flexible Budgets and Overhead Analysis

Decentralization

Relevant Costs for Decision Making

Capital Budgeting Decisions

How Well Am I Doing Financial Statement Analysis

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Exam 13: How Well Am I Doing Statement of Cash Flows

Between 20 × 8 and 20 × 9,the times interest earned ratio:

Marcial Company's inventory turnover for 20 × 6 was closest to:

Financial statements for Praeger Company appear below:

Larned Company's book value per share at the end of 20 × 6 was closest to:

Calculate the gross margin percentage for 20 × 4.

An increase in the market price of a company's common shares will immediately affect its:

Comparative financial statements for Springville Company for the last two years appear below.The market price of each share of Springville's common stock was $25 on December 31,Year 2.During Year 2,dividends of $2,000,000 were paid to preferred shareholders and $10,000,000 to common shareholders.

When computing the return on total assets,the after-tax effect of interest expense must be subtracted from net income.

The following data have been taken from your company's financial records for the current year: The price-earnings ratio is:

Andy Inc.has $15,000 in cash,$38,000 in current receivables,$18,000 in inventories,$4,000 in prepaid expenses and $40,000 in current liabilities.The company's current ratio is closest to:

Information concerning the common stock of Morris Company as of the end of the company's fiscal year is presented below. The dividend yield ratio is closest to:

The gross margin percentage is computed taking the difference between sales and cost of goods sold and then dividing the result by sales.

Larosa Company's price-earnings ratio on December 31,20 × 6 was closest to:

Orantes Company's average collection period (age of receivables)for 20 × 6 was closest to:

The time interest earned ratio is calculated by dividing net income by interest expense.

Eastham Company's accounts receivable were $600,000 at the beginning of the year and $800,000 at the end of the year.Cash sales for the year were $300,000.The accounts receivable turnover for the year was 5 times.Eastham Company's total sales for the year were:

Lisa Inc.'s return on common shareholders' equity for 20 × 7 was closest to:

Financial statements for AAR Company appear below:

An Introduction to Managerial Accounting and Cost Concepts

Systems Design: Job-Order Costing

Systems Design: Activity-Based Costing

Systems Design: Process Costing

Cost Behavior: Analysis and Use

Cost-Volume-Profit Relationships

Profit Planning

Standard Costs

Flexible Budgets and Overhead Analysis

Decentralization

Relevant Costs for Decision Making

Capital Budgeting Decisions

How Well Am I Doing Financial Statement Analysis

Filters