Question 1

The acid-test ratio is usually greater than the current ratio.

Accepted Answer

A) True 
 B)False

Question 2

Ribaudo Corporation has provided the following financial data from its balance sheet and income statement:   The company's total asset turnover for Year 2 is closest to:

Accepted Answer

A) 5.29 
B) 0.19 
C) 1.04 
D) 0.96 
A) 5.29 
B) 0.19 
C) 1.04 
D) 0.96

Question 3

Nickolls Corporation has provided the following financial data:   The company's current ratio is closest to:

Accepted Answer

A) 0.47 
B) 0.40 
C) 0.19 
D) 4.25 
A) 0.47 
B) 0.40 
C) 0.19 
D) 4.25

Question 4

Granger Corporation had $180,000 in sales on account last year.The beginning accounts receivable balance was $10,000 and the ending accounts receivable balance was $18,000.The corporation's average collection period was closest to:

Accepted Answer

A) 20.3 days 
B) 28.4 days 
C) 36.5 days 
D) 56.8 days 
A) 20.3 days 
B) 28.4 days 
C) 36.5 days 
D) 56.8 days

Question 5

Erastic Corporation has $14,000 in cash,$8,000 in marketable securities,$34,000 in account receivable,$40,000 in inventories,and $42,000 in current liabilities.The corporation's current assets consist of cash,marketable securities,accounts receivable,and inventory.The corporation's acid-test ratio is closest to:

Accepted Answer

A) 1.33 
B) 0.81 
C) 2.29 
D) 1.14 
A) 1.33 
B) 0.81 
C) 2.29 
D) 1.14

Question 6

Neef Corporation has provided the following financial data from its balance sheet and income statement:     The company's return on total assets for Year 2 is closest to:

Accepted Answer

A) 0.99% 
B) 1.00% 
C) 1.85% 
D) 1.83% 
A) 0.99% 
B) 1.00% 
C) 1.85% 
D) 1.83%

Question 7

Deacon Corporation has provided the following financial data from its balance sheet and income statement:   The company's times interest earned for Year 2 is closest to:

Accepted Answer

A) 2.74 
B) 8.02 
C) 5.21 
D) 4.21 
A) 2.74 
B) 8.02 
C) 5.21 
D) 4.21

Question 8

Kaloi Corporation has provided the following financial data:     Dividends on common stock during Year 2 totaled $3,500.The market price of common stock at the end of Year 2 was $7.46 per share.
Required:
a.What is the company's working capital at the end of Year 2?
b.What is the company's current ratio at the end of Year 2?
c.What is the company's acid-test (quick)ratio at the end of Year 2?
d.What is the company's accounts receivable turnover for Year 2?
e.What is the company's average collection period (age of receivables)for Year 2?
f.What is the company's inventory turnover for Year 2?
g.What is the company's average sale period (turnover in days)for Year 2?
h.What is the company's operating cycle for Year 2?
i.What is the company's total asset turnover for Year 2?
j.What is the company's times interest earned for Year 2?
k.What is the company's debt-to-equity ratio at the end of Year 2?
l.What is the company's equity multiplier at the end of Year 2?
m.What is the company's net profit margin percentage for Year 2?
n.What is the company's gross margin percentage for Year 2?
o.What is the company's return on total assets for Year 2?
p.What is the company's return on equity for Year 2?

Accepted Answer

a.Working capital = Current assets - Cur

Question 9

All other things the same,when a customer purchases an item for cash,the accounts receivable turnover ratio increases.

Accepted Answer

A) True 
 B)False

Question 10

The gross margin percentage is computed by dividing the gross margin by net income before interest and taxes.

Accepted Answer

A) True 
 B)False

Question 11

Louie Corporation has provided the following data:   The company's operating cycle for Year 2 is closest to:

Accepted Answer

A) 81.0 days 
B) 150.5 days 
C) 79.2 days 
D) 9.7 days 
A) 81.0 days 
B) 150.5 days 
C) 79.2 days 
D) 9.7 days

Question 12

Neiger Corporation has provided the following financial data:     Required:
a.What is the company's working capital at the end of Year 2?
b.What is the company's current ratio at the end of Year 2?
c.What is the company's acid-test (quick)ratio at the end of Year 2?
d.What is the company's times interest earned for Year 2?
e.What is the company's debt-to-equity ratio at the end of Year 2?
f.What is the company's equity multiplier at the end of Year 2?

Accepted Answer

a.Working capital = Current assets - Cur

Question 13

Which one of the following statements about book value per share is most correct?

Accepted Answer

A) Market price per common share usually approximates book value per common share. 
B) Book value per common share is based on past transactions whereas the market price of a share of stock mainly reflects what investors expect to happen in the future. 
C) A market price per common share that is greater than book value per common share is an indication of an overvalued stock. 
D) Book value per common share is the amount that would be paid to stockholders if the company were sold to another company. 
A) Market price per common share usually approximates book value per common share. 
B) Book value per common share is based on past transactions whereas the market price of a share of stock mainly reflects what investors expect to happen in the future. 
C) A market price per common share that is greater than book value per common share is an indication of an overvalued stock. 
D) Book value per common share is the amount that would be paid to stockholders if the company were sold to another company.

Question 14

Wyand Corporation's net operating income last year was $212,000;its interest expense was $26,000;its total stockholders' equity was $1,000,000;and its total liabilities were $370,000.
Required:
Compute the following for Year 2:
a.Times interest earned.
b.Debt-to-equity ratio.

Accepted Answer

a.Times interest earned = Net

Question 15

Gambino Corporation has provided the following financial data:     Required:
a.What is the company's times interest earned for Year 2?
b.What is the company's debt-to-equity ratio at the end of Year 2?
c.What is the company's equity multiplier at the end of Year 2?

Accepted Answer

a.Times interest earned = Net operating

Question 16

Ribaudo Corporation has provided the following financial data from its balance sheet and income statement:   The company's average collection period (age of receivables)for Year 2 is closest to:

Accepted Answer

A) 70.1 days 
B) 1.1 days 
C) 72.1 days 
D) 1.0 days 
A) 70.1 days 
B) 1.1 days 
C) 72.1 days 
D) 1.0 days

Question 17

Deacon Corporation has provided the following financial data from its balance sheet and income statement:   The company's equity multiplier at the end of Year 2 is closest to:

Accepted Answer

A) 0.64 
B) 1.65 
C) 1.57 
D) 0.61 
A) 0.64 
B) 1.65 
C) 1.57 
D) 0.61

Question 18

Crosswhite Corporation's sales last year were $1,270,000,its gross margin was $400,000,its net operating income was $53,769,and its net income was $26,500.The company's net profit margin percentage is closest to:

Accepted Answer

A) 31.5% 
B) 3.2% 
C) 4.2% 
D) 2.1% 
A) 31.5% 
B) 3.2% 
C) 4.2% 
D) 2.1%

Question 19

Rough Corporation's total assets at the end of Year 2 were $1,247,000 and at the end of Year 1 were $1,270,000.The company's total liabilities at the end of Year 2 were $512,000 and at the end of Year 1 were $550,000.The company's total stockholders' equity at the end of Year 2 was $735,000 and at the end of Year 1 was $720,000.The company's equity multiplier is closest to:

Accepted Answer

A) 1.73 
B) 1.44 
C) 0.69 
D) 0.58 
A) 1.73 
B) 1.44 
C) 0.69 
D) 0.58

Question 20

Last year Truro Corporation purchased $800,000 of inventory.The cost of goods sold was $750,000 and the ending inventory was $125,000.The inventory turnover for the year was:

Accepted Answer

A) 6.0 
B) 7.5 
C) 6.4 
D) 8.0 
A) 6.0 
B) 7.5 
C) 6.4 
D) 8.0

The acid-test ratio is usually greater than the current ratio.

Ribaudo Corporation has provided the following financial data from its balance sheet and income statement: The company's total asset turnover for Year 2 is closest to:

Nickolls Corporation has provided the following financial data: The company's current ratio is closest to:

Granger Corporation had $180,000 in sales on account last year.The beginning accounts receivable balance was $10,000 and the ending accounts receivable balance was $18,000.The corporation's average collection period was closest to:

Neef Corporation has provided the following financial data from its balance sheet and income statement: The company's return on total assets for Year 2 is closest to:

Deacon Corporation has provided the following financial data from its balance sheet and income statement: The company's times interest earned for Year 2 is closest to:

All other things the same,when a customer purchases an item for cash,the accounts receivable turnover ratio increases.

The gross margin percentage is computed by dividing the gross margin by net income before interest and taxes.

Louie Corporation has provided the following data: The company's operating cycle for Year 2 is closest to:

Which one of the following statements about book value per share is most correct?

Wyand Corporation's net operating income last year was $212,000;its interest expense was $26,000;its total stockholders' equity was $1,000,000;and its total liabilities were $370,000. Required: Compute the following for Year 2: a.Times interest earned. b.Debt-to-equity ratio.

Gambino Corporation has provided the following financial data: Required: a.What is the company's times interest earned for Year 2? b.What is the company's debt-to-equity ratio at the end of Year 2? c.What is the company's equity multiplier at the end of Year 2?

Ribaudo Corporation has provided the following financial data from its balance sheet and income statement: The company's average collection period (age of receivables)for Year 2 is closest to:

Deacon Corporation has provided the following financial data from its balance sheet and income statement: The company's equity multiplier at the end of Year 2 is closest to:

Crosswhite Corporation's sales last year were $1,270,000,its gross margin was $400,000,its net operating income was $53,769,and its net income was $26,500.The company's net profit margin percentage is closest to:

Last year Truro Corporation purchased $800,000 of inventory.The cost of goods sold was $750,000 and the ending inventory was $125,000.The inventory turnover for the year was:

Managerial Accounting and Cost Concepts

Job-Order Costing: Calculating Unit Production Costs

Job-Order Costing: Cost Flows and External Reporting

Process Costing

Supplement: Process Costing Using the Fifo Method

Cost-Volume-Profit Relationships

Variable Costing and Segment Reporting: Tools for Management

Activity-Based Costing: a Tool to Aid Decision Making

Master Budgeting

Flexible Budgets and Performance Analysis

Differential Analysis: The Key to Decision Making

Performance Measurement in Decentralized Organizations

Differential Analysis: The Key to Decision Making

Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System

Journal Entries to Record Variance

The Concept of Present Value

The Direct Method of Determining the Net Cash Provided by Operating Activities

Filters

Exam 14: Capital Budgeting Decisions

The acid-test ratio is usually greater than the current ratio.

Ribaudo Corporation has provided the following financial data from its balance sheet and income statement: The company's total asset turnover for Year 2 is closest to:

Nickolls Corporation has provided the following financial data: The company's current ratio is closest to:

Granger Corporation had $180,000 in sales on account last year.The beginning accounts receivable balance was $10,000 and the ending accounts receivable balance was $18,000.The corporation's average collection period was closest to:

Neef Corporation has provided the following financial data from its balance sheet and income statement: The company's return on total assets for Year 2 is closest to:

Deacon Corporation has provided the following financial data from its balance sheet and income statement: The company's times interest earned for Year 2 is closest to:

All other things the same,when a customer purchases an item for cash,the accounts receivable turnover ratio increases.

The gross margin percentage is computed by dividing the gross margin by net income before interest and taxes.

Louie Corporation has provided the following data: The company's operating cycle for Year 2 is closest to:

Which one of the following statements about book value per share is most correct?

Wyand Corporation's net operating income last year was $212,000;its interest expense was $26,000;its total stockholders' equity was $1,000,000;and its total liabilities were $370,000. Required: Compute the following for Year 2: a.Times interest earned. b.Debt-to-equity ratio.

Gambino Corporation has provided the following financial data: Required: a.What is the company's times interest earned for Year 2? b.What is the company's debt-to-equity ratio at the end of Year 2? c.What is the company's equity multiplier at the end of Year 2?

Ribaudo Corporation has provided the following financial data from its balance sheet and income statement: The company's average collection period (age of receivables)for Year 2 is closest to:

Deacon Corporation has provided the following financial data from its balance sheet and income statement: The company's equity multiplier at the end of Year 2 is closest to:

Crosswhite Corporation's sales last year were $1,270,000,its gross margin was $400,000,its net operating income was $53,769,and its net income was $26,500.The company's net profit margin percentage is closest to:

Last year Truro Corporation purchased $800,000 of inventory.The cost of goods sold was $750,000 and the ending inventory was $125,000.The inventory turnover for the year was:

Managerial Accounting and Cost Concepts

Job-Order Costing: Calculating Unit Production Costs

Job-Order Costing: Cost Flows and External Reporting

Process Costing

Supplement: Process Costing Using the Fifo Method

Cost-Volume-Profit Relationships

Variable Costing and Segment Reporting: Tools for Management

Activity-Based Costing: a Tool to Aid Decision Making

Master Budgeting

Flexible Budgets and Performance Analysis

Differential Analysis: The Key to Decision Making

Performance Measurement in Decentralized Organizations

Differential Analysis: The Key to Decision Making

Predetermined Overhead Rates and Overhead Analysis in a Standard Costing System

Journal Entries to Record Variance

The Concept of Present Value

The Direct Method of Determining the Net Cash Provided by Operating Activities

Filters