Reference no: EM132774602
Questions -
Q1. Which of the following does a balance sheet do? (Check all that apply)
Shows the assets of a firm
Measures the financial position of the firm at a point in time
Shows how much debt a firm has
Measures the activities of the firm over a period of time (e.g. a year)
Shows the revenues of a firm
Q2. Which of the following are on a Balance Sheet? (Check all that apply)
Accounts Payable
Depreciation Expense
Retained Earnings
Property, Plant, and Equipment
Sales Revenue
Q3. Suppose Current Assets for a firm are $50, Long-Term Assets are $100, and Total Liabilities are $30. How much is the firm's total Owners' Equity?
$150
$120
$70
$180
Q4. Suppose Net Income for a firm is $200 for the year and Dividends paid are $60. How much does Retained Earnings on the Balance Sheet change during the year?
Goes up by $200
Goes up by $260
Does not change
Goes up by $140
Q5. Which of the following are on an Income Statement? (Check all that apply)
Accounts Receivable
Interest Expense
Selling, General, and Administrative Expense
Cost of Goods Sold
Long-Term Debt
Q6. Given the following information (not all of which is relevant), what is Net Income?
Sales Revenue = $5000
Dividends Paid = $200
Cash = $100
SG&A Expense = $400
Cost of Goods Sold = $1600
$3000
$4800
$2800
$3300
$3100
Q7. Which of the following will impact income THIS year?
Spend $100 on research and development
Spend $100 on purchases of equipment
Spend $100 to pay off short-term debt
Spend $100 on purchases of inventory that is still not sold at the end of the year
Q8. Which of the following will result in the firm recognizing revenue this year? (Check all that apply)
Receiving cash for a product delivered in a prior year
A customer places an order for a new product
Delivering a service for which you had been paid in a prior year
Selling a product on credit
Receiving an advance deposit in cash from a customer
Q9. Suppose the following transaction(s) happen: A firm issues long-term debt and receives $50,000 in cash. What happens to the various sections of the balance sheet?
Short-Term Assets go up by $50,000 and Long-Term Assets go down by $50,000
Short-Term Assets go up by $50,000 and Owners' Equity goes down by $50,000
Short-Term Assets go up by $50,000 and Owners' Equity goes up by $50,000
Short-Term Assets go up by $50,000 and Long-Term Liabilities go down by $50,000
Short-Term Assets go up by $50,000 and Long-Term Liabilities go up by $50,000
Q10. Suppose the following transaction(s) happen: A firm sells inventory that had cost $100 for $150. Of the $150 of sales, $120 is cash and $30 is credit. Which of the following effects on the balance sheet are correct? (Check all that apply) Note that none of the answers give ALL the effects.
Retained Earnings goes up by $50
Inventory goes up by $100
Cash goes up by $150
Accounts Receivable goes up by $30
Accounts Payable goes up by $120
Q11. Suppose you buy a machine for $300,000 that is expected to last for 10 years, with no salvage value at that time. If the firm uses straight-line depreciation, how much depreciation expense is recognized per year?
$10
$30,000
$300,000
$0
Q12. We generate sales of $100,000 for the year. Of this amount, $80,000 are cash sales and $20,000 are credit sales. Based on past experience, we expect that 10% of the credit sales won't be collected. How much income should the firm recognize for the year? (Ignore anything else that is not referenced in the problem, such as cost of goods sold, interest expense, etc.)
$90,000
$82,000
$80,000
$98,000
$100,000