Quize 2

Topics: Generally Accepted Accounting Principles, Inventory, Balance sheet Pages: 5 (618 words) Published: September 29, 2014
Question 1
2 out of 2 points

Art's Boutique has sales of $640,000 and costs of $480,000. Interest expense is $40,000 and depreciation is $60,000. The tax rate is 34%. What is the net income? Answer

Selected Answer:
  
$39,600
Correct Answer:
  
$39,600

Response Feedback:
Taxable income = $640,000 - $480,000 - $40,000 - $60,000 = $60,000; Tax = .34($60,000) = $20,400; Net income = $60,000 - $20,400 = $39,600  
Difficulty level: Medium
Ross - Chapter 02 #56
Topic: NET INCOME
Type: PROBLEMS

Question 2
2 out of 2 points

Which of the following are all components of the statement of cash flows? Answer

Selected Answer:
  
Cash flow from operating activities, cash flow from investing activities, and cash flow from financing activities Correct Answer:
  
Cash flow from operating activities, cash flow from investing activities, and cash flow from financing activities

Response Feedback:
correct
 
Difficulty level: Medium
Ross - Chapter 02 #50
Topic: STATEMENT OF CASH FLOWS
Type: CONCEPTS

Question 3
2 out of 2 points

Brad's Company has equipment with a book value of $500 that could be sold today at a 50% discount. Its inventory is valued at $400 and could be sold to a competitor for that amount. The firm has $50 in cash and customers owe it $300. What is the accounting value of its liquid assets? Answer

Selected Answer:
  
$750
Correct Answer:
  
$750

Response Feedback:
Liquid assets = $400 + $50 + $300 = $750
 
Difficulty level: Medium
Ross - Chapter 02 #54
Topic: LIQUIDITY
Type: PROBLEMS

Question 4
2 out of 2 points

At the beginning of the year, a firm has current assets of $380 and current liabilities of $210. At the end of the year, the current assets are $410 and the current liabilities are $250. What is the change in net working capital? Answer

Selected Answer:
  
-$10
Correct Answer:
  
-$10

Response Feedback:
Change in net working capital = ($410 - $250) - ($380 - $210) = -$10  
Difficulty level: Medium
Ross - Chapter 02 #61
Topic: CHANGE IN NET WORKING CAPITAL
Type: PROBLEMS

Question 5
2 out of 2 points

_____ refers to the cash flow that results from the firm's ongoing, normal business activities. Answer

Selected Answer:
  
Cash flow from operating activities
Correct Answer:
  
Cash flow from operating activities

Response Feedback:
correct
 
Difficulty level: Medium
Ross - Chapter 02 #10
Topic: CASH FLOW FROM OPERATING ACTIVITIES
Type: DEFINITIONS

Question 6
2 out of 2 points

A(n) ____ asset is one which can be quickly converted into cash without significant loss in value. Answer

Selected Answer:
  
liquid
Correct Answer:
  
liquid

Response Feedback:
correct
 
Difficulty level: Easy
Ross - Chapter 02 #5
Topic: LIQUID ASSETS
Type: DEFINITIONS

Question 7
2 out of 2 points

The financial statement showing a firm's accounting value on a particular date is the: Answer

Selected Answer:
  
balance sheet.
Correct Answer:
  
balance sheet.

Response Feedback:
correct
 
Difficulty level: Easy
Ross - Chapter 02 #1
Topic: BALANCE SHEET
Type: DEFINITIONS

Question 8
2 out of 2 points

Which equality is the basis for the balance sheet?
Answer

Selected Answer:
  
Assets = Liabilities + Stockholder's Equity
Correct Answer:
  
Assets = Liabilities + Stockholder's Equity

Response Feedback:
correct
 
Difficulty level: Medium
Ross - Chapter 02 #38
Topic: BALANCE SHEET
Type: CONCEPTS

Question 9
2 out of 2 points

Your _____ tax rate is the total taxes you pay divided by your taxable income. Answer

Selected Answer:
  
average
Correct Answer:
  
average

Response Feedback:
correct
 
Difficulty level: Easy
Ross - Chapter 02 #9
Topic: AVERAGE TAX RATES
Type: DEFINITIONS

Question 10
2 out of 2 points...
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