Question 1

Which of the following is not a source of financial leverage?

Accepted Answer

A) Bonds payable. 
B) Accounts payable. 
C) Taxes payable. 
D) Prepaid rent. 
A) Bonds payable. 
B) Accounts payable. 
C) Taxes payable. 
D) Prepaid rent.

Question 2

Garrott Corporation's total assets were $1,505,000 at the end of Year 2 and $1,520,000 at the end of Year 1.Its total stockholders' equity was $1,197,000 at the end of Year 2 and $1,180,000 at the end of Year 1.   The company's net profit margin percentage for Year 2 is closest to:

Accepted Answer

A) 1.9% 
B) 2.7% 
C) 3.3% 
D) 38.1% 
A) 1.9% 
B) 2.7% 
C) 3.3% 
D) 38.1%

Question 3

Sabino Corporation's total common stock was $500,000 at the end of both Year 2 and Year 1.The par value of common stock is $5 per share.The company's total stockholders' equity at the end of Year 2 amounted to $1,125,000 and at the end of Year 1 to $1,090,000.The company's total liabilities and stockholders' equity at the end of Year 2 amounted to $1,581,000 and at the end of Year 1 to $1,540,000.The company's retained earnings at the end of Year 2 amounted to $545,000 and at the end of Year 1 to $510,000.The company's net income in Year 2 was $39,000.The company's book value per share at the end of Year 2 is closest to:

Accepted Answer

A) $0.39 per share 
B) $15.81 per share 
C) $11.25 per share 
D) $5.45 per share 
A) $0.39 per share 
B) $15.81 per share 
C) $11.25 per share 
D) $5.45 per share

Question 4

Steinkraus Corporation has provided the following data:   Required:
Compute the accounts receivable turnover for this year.Show your work!

Accepted Answer

Accounts receivable turnover =

Question 5

Younis Corporation's income statement appears below:   The company's net profit margin percentage is closest to:

Accepted Answer

A) 37.1% 
B) 3.5% 
C) 2.4% 
D) 1.7% 
A) 37.1% 
B) 3.5% 
C) 2.4% 
D) 1.7%

Question 6

Sapien Corporation has provided the following data for the most recent year:   The company's gross margin percentage is closest to:

Accepted Answer

A) 52.3% 
B) 1691.2% 
C) 5.9% 
D) 34.3% 
A) 52.3% 
B) 1691.2% 
C) 5.9% 
D) 34.3%

Question 7

Excerpts from Sydner Corporation's most recent balance sheet appear below:   Sales on account in Year 2 amounted to $1,390 and the cost of goods sold was $900. The acid-test ratio at the end of Year 2 is closest to:

Accepted Answer

A) 1.67 
B) 1.00 
C) 0.97 
D) 1.25 
A) 1.67 
B) 1.00 
C) 0.97 
D) 1.25

Question 8

Fongeallaz Corporation's income statement for Year 2 appears below:   The company's total stockholders' equity at the end of Year 2 amounted to $841,000 and at the end of Year 1 to $810,000.The company's return on equity for Year 2 is closest to:

Accepted Answer

A) 64.40% 
B) 8.93% 
C) 6.75% 
D) 4.72% 
A) 64.40% 
B) 8.93% 
C) 6.75% 
D) 4.72%

Question 9

Spomer Corporation's inventory at the end of Year 2 was $114,000 and its inventory at the end of Year 1 was $120,000.Cost of goods sold amounted to $710,000 in Year 2.The company's inventory turnover for Year 2 is closest to:

Accepted Answer

A) 5.92 
B) 1.05 
C) 6.07 
D) 6.23 
A) 5.92 
B) 1.05 
C) 6.07 
D) 6.23

Question 10

Acquiring land by taking out a long-term mortgage will not affect the current ratio.

Accepted Answer

A) True 
 B)False

Question 11

Excerpts from Sydner Corporation's most recent balance sheet appear below:   Sales on account in Year 2 amounted to $1,390 and the cost of goods sold was $900. The current ratio at the end of Year 2 is closest to:

Accepted Answer

A) 1.67 
B) 0.32 
C) 0.80 
D) 0.41 
A) 1.67 
B) 0.32 
C) 0.80 
D) 0.41

Question 12

Mahoe Corporation has provided the following financial data:     Dividends on common stock during Year 2 totaled $500.The market price of common stock at the end of Year 2 was $8.06 per share. The company's equity multiplier at the end of Year 2 is closest to:

Accepted Answer

A) 0.28 
B) 1.28 
C) 3.53 
D) 0.78 
A) 0.28 
B) 1.28 
C) 3.53 
D) 0.78

Question 13

Purchasing inventory on credit increases the book value per share of a retailer.

Accepted Answer

A) True 
 B)False

Question 14

If a company's return on assets is substantially lower than its cost of borrowing,then the common stockholders would normally want the company to have a relatively high debt/equity ratio.

Accepted Answer

A) True 
 B)False

Question 15

Mayfield Corporation has provided the following financial data:   The company's working capital is:

Accepted Answer

A) $671,000 
B) $665,000 
C) $418,000 
D) $983,000 
A) $671,000 
B) $665,000 
C) $418,000 
D) $983,000

Question 16

Data from Keniston Corporation's most recent balance sheet and income statement appear below:   The average collection period for this year is closest to:

Accepted Answer

A) 39.1 days 
B) 45.1 days 
C) 54.3 days 
D) 57.5 days 
A) 39.1 days 
B) 45.1 days 
C) 54.3 days 
D) 57.5 days

Question 17

Macmillan Corporation has provided the following financial data:     Dividends on common stock during Year 2 totaled $7,200.The market price of common stock at the end of Year 2 was $3.69 per share. The company's working capital at the end of Year 2 is:

Accepted Answer

A) $732,000 
B) $831,000 
C) $289,000 
D) $590,000 
A) $732,000 
B) $831,000 
C) $289,000 
D) $590,000

Question 18

Data from Dalpiaz Corporation's most recent balance sheet and income statement appear below:   Required:
Compute the average collection period for this year:

Accepted Answer

Average collection period = 365 days ÷ A

Question 19

Stimac Corporation has total cash of $210,000,no marketable securities,total current receivables of $281,000,total inventory of $151,000,total prepaid expenses of $53,000,total current assets of $695,000,total current liabilities of $261,000,total stockholders' equity of $1,014,000,total assets of $1,415,000,and total liabilities of $401,000.The company's acid-test (quick)ratio is closest to:

Accepted Answer

A) 2.08 
B) 1.73 
C) 2.66 
D) 1.88 
A) 2.08 
B) 1.73 
C) 2.66 
D) 1.88

Question 20

Wittels Corporation has provided the following data:   In Year 2,the company's net operating income was $42,571,its net income before taxes was $21,571,and its net income was $15,100.The company's equity multiplier is closest to:

Accepted Answer

A) 1.14 
B) 0.53 
C) 0.88 
D) 1.87 
A) 1.14 
B) 0.53 
C) 0.88 
D) 1.87

Which of the following is not a source of financial leverage?

Garrott Corporation's total assets were $1,505,000 at the end of Year 2 and $1,520,000 at the end of Year 1.Its total stockholders' equity was $1,197,000 at the end of Year 2 and $1,180,000 at the end of Year 1. The company's net profit margin percentage for Year 2 is closest to:

Steinkraus Corporation has provided the following data: Required: Compute the accounts receivable turnover for this year.Show your work!

Younis Corporation's income statement appears below: The company's net profit margin percentage is closest to:

Sapien Corporation has provided the following data for the most recent year: The company's gross margin percentage is closest to:

Excerpts from Sydner Corporation's most recent balance sheet appear below: Sales on account in Year 2 amounted to $1,390 and the cost of goods sold was $900. The acid-test ratio at the end of Year 2 is closest to:

Fongeallaz Corporation's income statement for Year 2 appears below: The company's total stockholders' equity at the end of Year 2 amounted to $841,000 and at the end of Year 1 to $810,000.The company's return on equity for Year 2 is closest to:

Spomer Corporation's inventory at the end of Year 2 was $114,000 and its inventory at the end of Year 1 was $120,000.Cost of goods sold amounted to $710,000 in Year 2.The company's inventory turnover for Year 2 is closest to:

Acquiring land by taking out a long-term mortgage will not affect the current ratio.

Excerpts from Sydner Corporation's most recent balance sheet appear below: Sales on account in Year 2 amounted to $1,390 and the cost of goods sold was $900. The current ratio at the end of Year 2 is closest to:

Mahoe Corporation has provided the following financial data: Dividends on common stock during Year 2 totaled $500.The market price of common stock at the end of Year 2 was $8.06 per share. The company's equity multiplier at the end of Year 2 is closest to:

Purchasing inventory on credit increases the book value per share of a retailer.

If a company's return on assets is substantially lower than its cost of borrowing,then the common stockholders would normally want the company to have a relatively high debt/equity ratio.

Mayfield Corporation has provided the following financial data: The company's working capital is:

Data from Keniston Corporation's most recent balance sheet and income statement appear below: The average collection period for this year is closest to:

Macmillan Corporation has provided the following financial data: Dividends on common stock during Year 2 totaled $7,200.The market price of common stock at the end of Year 2 was $3.69 per share. The company's working capital at the end of Year 2 is:

Data from Dalpiaz Corporation's most recent balance sheet and income statement appear below: Required: Compute the average collection period for this year:

Wittels Corporation has provided the following data: In Year 2,the company's net operating income was $42,571,its net income before taxes was $21,571,and its net income was $15,100.The company's equity multiplier is closest to:

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

Which of the following is not a source of financial leverage?

Garrott Corporation's total assets were $1,505,000 at the end of Year 2 and $1,520,000 at the end of Year 1.Its total stockholders' equity was $1,197,000 at the end of Year 2 and $1,180,000 at the end of Year 1. The company's net profit margin percentage for Year 2 is closest to:

Steinkraus Corporation has provided the following data: Required: Compute the accounts receivable turnover for this year.Show your work!

Younis Corporation's income statement appears below: The company's net profit margin percentage is closest to:

Sapien Corporation has provided the following data for the most recent year: The company's gross margin percentage is closest to:

Excerpts from Sydner Corporation's most recent balance sheet appear below: Sales on account in Year 2 amounted to $1,390 and the cost of goods sold was $900. The acid-test ratio at the end of Year 2 is closest to:

Fongeallaz Corporation's income statement for Year 2 appears below: The company's total stockholders' equity at the end of Year 2 amounted to $841,000 and at the end of Year 1 to $810,000.The company's return on equity for Year 2 is closest to:

Spomer Corporation's inventory at the end of Year 2 was $114,000 and its inventory at the end of Year 1 was $120,000.Cost of goods sold amounted to $710,000 in Year 2.The company's inventory turnover for Year 2 is closest to:

Acquiring land by taking out a long-term mortgage will not affect the current ratio.

Excerpts from Sydner Corporation's most recent balance sheet appear below: Sales on account in Year 2 amounted to $1,390 and the cost of goods sold was $900. The current ratio at the end of Year 2 is closest to:

Mahoe Corporation has provided the following financial data: Dividends on common stock during Year 2 totaled $500.The market price of common stock at the end of Year 2 was $8.06 per share. The company's equity multiplier at the end of Year 2 is closest to:

Purchasing inventory on credit increases the book value per share of a retailer.

If a company's return on assets is substantially lower than its cost of borrowing,then the common stockholders would normally want the company to have a relatively high debt/equity ratio.

Mayfield Corporation has provided the following financial data: The company's working capital is:

Data from Keniston Corporation's most recent balance sheet and income statement appear below: The average collection period for this year is closest to:

Macmillan Corporation has provided the following financial data: Dividends on common stock during Year 2 totaled $7,200.The market price of common stock at the end of Year 2 was $3.69 per share. The company's working capital at the end of Year 2 is:

Data from Dalpiaz Corporation's most recent balance sheet and income statement appear below: Required: Compute the average collection period for this year:

Wittels Corporation has provided the following data: In Year 2,the company's net operating income was $42,571,its net income before taxes was $21,571,and its net income was $15,100.The company's equity multiplier is closest to:

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