Reference no: EM132489728

Question 1: From an ordinary annuity, you will receive annual payments of $10,000 for 3 years. Assuming you can invest at an annual interest rate of 8%, what is the future value of the annuity at the end of its life?

a.$25,771.

b.$35,061.

c.$27,833.

d.$32,464.

Question 2: On a Financial Statement, an auditors' disclaimer means that

a.Auditors were not able to gain sufficient evidence to form an opinion.

b.Financial statements fairly present the financial position, with exceptions.

c.Financial statements do not fairly present the financial position.

d.Financial statements fairly present the financial position.

Question 3: The Equity Multiplier is a measurement of:

a.Leverage: high equity multiplier indicates that relatively more of the company's assets have been financed with debt.

b.Equity efficiency: high equity multiplier indicates that relatively more of the company's assets have been financed with equity.

c.Asset efficiency: how efficiently a company utilizes all of its assets to generate revenue.

d.Debt: low equity multiplier indicates that relatively more of the company's assets have been financed with debt

Question 4: The 5 steps of revenue recognition do not include:

a.The identification of the contract.

b.Determination of the transaction price.

c.The collection of cash.

d.The identification of the performance obligation.

Question 5: Revenue is recognized at a single point in time when

a.Control of an asset has transferred from the seller to the customer.

b.The customer is using or controlling an asset while it is being built.

c.A service is being performed by the seller and consumed by the buyer over time.

d.The seller is producing a custom order.

Question 6:  you owe $1,050 to a lender, but you only have $1,000 in cash (not enough cash to pay the total right now). The lender allows you to renegotiate the terms of this note, giving you four options: to pay $1,150 in one year; to pay $1,250 in 2 years; to pay $1,350 in 3 years, or to pay $1,450 in 4 years. Assuming you can invest your money at an annual interest rate of 10%, which option do you prefer?

a. Pay $1,150 in one year.

b.Pay $1,450 in 4 years.

c.Pay $1,250 in 2 years.

d.Pay $1,350 in 3 years.