1. Dan’s business has sales of $100,000, inventory of $20,000, cost of goods sold of $31,000, and general and administrative expenses of $45,000. Bill’s gross profit is $80,000.
True
False
2. Mary’s balance sheet is partially completed. However, she has total assets of $120,000 and total stockholder’s equity of $15,000. Her liabilities should total $105,000.
True
False
3. Sarah wants to produce a financial report that shows the amounts the company owes, what it owns, and include her shareholder stake at a particular date in time. She wants to produce a(n) ______.
a. balance sheet
b. bookings order
c. accounts receivable sheet
d. income statement
4. The balance sheet shows ______.
a. what the business owns and what the business owes
b. only net worth
c. current expenses
d. shareholder deferred revenue
5. ______ is the amount that customers owe to a company after receipt of item(s) purchased.
a. Accounts payable
b. Accounts receivable
c. Accounts deferred
d. Accounts accrued
6. When a company has long-term investments, it means they ______.
a. have cash, stocks, bonds, and real estate that has been on their books longer than one year
b. should be selling them soon so they can become short-term profit
c. have more cash than they need and they are wasting it on long-term investments
d. are going for a bank loan
7. Guy is very interested in managing his cash. You mentioned this course to him and told him about ______, which is the number of days a company’s cash is tied up in the production and sales process.
a. the income statement
b. Cash Convention Report
c. Cash conversion cycle
d. adding depreciation and amortization to net income
8. The pro forma financial statement should include at least three scenarios of your financial forecast—an income statement, the balance sheet, and ______.
a. the cash outflow statement
b. capitol stock
c. the cash flow statement
d. accrued expenses