Reference no: EM132214636

Questions -

Q1. Which type of business organization is a separate legal entity whose owners are not personally liable for the debts of the business?

a) Corporation

b) Partnership

Q2. Which of these best describes a balance sheet?

a) Listing of balance

b) A record of closing entries

Q3. In whole farm planning it is assumed that when _____________________ is maximized, total profit is maximized

a) Profit per unit

b) Total gross

c) Total gross income

Q4. If the interest rate on debt is higher than ROA, then a firm will __________ by increasing the use of debt in the capital structure.

a) Not change the ROE

b) Change the ROE in an indeterminable

c) Increase the ROE

Q5. An example of a liquidity ratio is

a) Acid test or quick ratio.

b) Fixed asset turnover.

c) Fixed asset turnover and current ratio.

d) Fixed asset turnover and quick ratio.

e) Current ratio and quick ratio.

Q6. Identify the step in the accounting cycle that takes place during the accounting period rather than at the end of the accounting period.

a) Recording closing entries in the journal

 

b) Posting adjusting entries in the ledger

c) Recording transaction in the journal

Q7. If you wish to compute economic earnings and are trying to decide how to account for inventory, _______.

a) FIFO and LIFO are equally bad

b) FIFO is better than LIFO

C) FIFO and LIFO are equally good

d) LIFO is better than FIFO

Q8. Financial ratios are used to weigh and evaluate:

a) Which stock is about to file for bankruptcy.

b) Which stock are gold mine stock when investing.

c) The operating performance and capital structure in the form.

Q9. How are LIFO inventory numbers converted into FIFO inventory numbers?

a) Subtract the FIFO reserve and the LIFO inventory number.

b) Add the LIFO reserve and the LIFO numbers.

c) Add FIFO reserve and the LIFO inventory numbers.

Q10. Which of the following is NOT an example of an intangible asset?

a) Goodwill

b) Equipment

c) Copyrights

Q11. In an inflationary economy, many firms use the ________ method of inventory valuation to reduce distortion of profits.

a) LIFO

b) LILO

c) FIFO

Q12. Which of the following are needed to generate an income statement for a merchandising firm?

a) Revenue, cost of goods sold, and expenses

b) Cost of goods sold, inventory and expenses

c) Expenses, pre-paid payments and inventory

Q13. In 2012, Utility Queen recorded an EBIT (Earnings before Income Tax) of $535,000; $1.35 million in shareholder's equity; an accounts payable balance of $250,000; and $385,000 in total liabilities. What was the company's debt-to-equity ratio for 2011?

a) 0.33

b) 1.54

C) 0.29