Question 1

A company's treasury stock is outstanding but not issued.

Accepted Answer

A) True 
 B)False

Question 2

Bob Company reported sales of $200,000, an increase in accounts receivable of $15,000, and a decrease in cash of $20,000.____ was received from Bob Company's customers.

Accepted Answer

A) $195,000 
B) $185,000 
C) $200,000 
D) $220,000

Question 3

When reconciling net income to net cash provided by operating activities, all of the following would be an appropriate procedure except _____.

Accepted Answer

A) adding depreciation expense 
B) subtracting a decrease in accounts payable 
C) subtracting a decrease in prepaid expenses 
D) adding a decrease in inventories

Question 4

Stock that has no predetermined rate of dividends and is the last to obtain a share in the assets when the corporation is dissolved

Accepted Answer

The answer of Stock that has no predetermined rate of...

Question 5

An organization's debts due after one year

Accepted Answer

The answer of An organization's debts due after one year...

Question 6

The possibility that long-term debt holders can transfer their debt back to the company in exchange for the company's stock

Accepted Answer

The answer of The possibility that long-term debt holders can...

Question 7

An inventory method that assumes a company sells or consumes the goods acquired earliest before any else

Accepted Answer

The answer of An inventory method that assumes a company...

Question 8

Operating income is equal to the cash flow from operations on a cash flow statement.

Accepted Answer

A) True 
 B)False

Question 9

Separately identifiable additions to a LIFO inventory

Accepted Answer

The answer of Separately identifiable additions to a LIFO inventory...

Question 10

Steve Company reported cost of goods sold of $910,000, an increase in inventory of $100,000, and a decrease in accounts payable of $40,000._____ was paid to Steve Company's suppliers.

Accepted Answer

A) $1,050,000 
B) $950,000 
C) $810,000 
D) $770,000

Question 11

The indirect and direct methods show the same amount of cash provided by or used for) operating activities.

Accepted Answer

A) True 
 B)False

Question 12

Stock that typically has some priority over other shares in the payment of dividends or the distribution of assets upon liquidation

Accepted Answer

The answer of Stock that typically has some priority over...

Question 13

Depreciation expense is not a source of cash.

Accepted Answer

A) True 
 B)False

Question 14

The section in the statement of cash flows that lists the cash flow effects of lending and collecting on loans, and acquiring and selling long-term assets

Accepted Answer

The answer of The section in the statement of cash...

Question 15

The method of preparing a statement of cash flows that reconciles net income to the net cash provided by operating activities

Accepted Answer

The answer of The method of preparing a statement of...

Question 16

When reconciling net income to net cash provided by operating activities, an) _____ is a deduction from net income.

Accepted Answer

A) decrease in inventories 
B) increase in unearned revenues 
C) decrease in prepaid rent 
D) decrease in accounts payable

Question 17

Allocating the original cost of intangible assets

Accepted Answer

The answer of Allocating the original cost of intangible assets...

Question 18

The balance sheet usually shows cash equivalents at cost or market price, whichever is higher.

Accepted Answer

A) True 
 B)False

Question 19

Retained earnings reflect the dividend paying ability of a company.

Accepted Answer

A) True 
 B)False

Question 20

Amounts owed for wages, salaries, and interest

Accepted Answer

The answer of Amounts owed for wages, salaries, and interest...

Exam 16: Understanding Corporate Annual Reports: Basic Financial Statements

A company's treasury stock is outstanding but not issued.

Bob Company reported sales of $200,000, an increase in accounts receivable of $15,000, and a decrease in cash of $20,000.____ was received from Bob Company's customers.

When reconciling net income to net cash provided by operating activities, all of the following would be an appropriate procedure except _____.

Stock that has no predetermined rate of dividends and is the last to obtain a share in the assets when the corporation is dissolved

An organization's debts due after one year

The possibility that long-term debt holders can transfer their debt back to the company in exchange for the company's stock

An inventory method that assumes a company sells or consumes the goods acquired earliest before any else

Operating income is equal to the cash flow from operations on a cash flow statement.

Separately identifiable additions to a LIFO inventory

Steve Company reported cost of goods sold of $910,000, an increase in inventory of $100,000, and a decrease in accounts payable of $40,000._____ was paid to Steve Company's suppliers.

The indirect and direct methods show the same amount of cash provided by or used for) operating activities.

Stock that typically has some priority over other shares in the payment of dividends or the distribution of assets upon liquidation

Depreciation expense is not a source of cash.

The section in the statement of cash flows that lists the cash flow effects of lending and collecting on loans, and acquiring and selling long-term assets

The method of preparing a statement of cash flows that reconciles net income to the net cash provided by operating activities

When reconciling net income to net cash provided by operating activities, an) _____ is a deduction from net income.

Allocating the original cost of intangible assets

The balance sheet usually shows cash equivalents at cost or market price, whichever is higher.

Retained earnings reflect the dividend paying ability of a company.

Amounts owed for wages, salaries, and interest