Accounting Assignment -
Part A -
1. Which one of the following is not a characteristic generally evaluated in analyzing financial statements?
A) Liquidity
B) Profitability
C) Marketability
D) Solvency
2. In analyzing the financial statements of a company, a single item on the financial statements
A) Should be reported in bold-face type.
B) Is more meaningful if compared to other financial information.
C) Is significant only if it is large.
D) Should be accompanied by a footnote.
3. A stockholder is interested in the ability of a firm to
A) Pay consistent dividends.
B) Appreciate in share price.
C) Survive over a long period.
D) All of these answer choices are correct.
4. Which one of the following is not a tool in financial statement analysis?
A) Horizontal analysis
B) Circular analysis
C) Vertical analysis
D) Ratio analysis
5. Assume the following sales data for a company:
2017 - $1,050,000
2016 - 950,000
2015 - 800,000
2014 - 650,000
If 2014 is the base year, what is the percentage increase in sales from 2014 to 2016?
A) 100%
B) 61.5%
C) 46.2%
D) 68.4%
6. Sara, Inc. has the following income statement (in millions):
SARA, INC. Income Statement For the Year Ended December 31, 2017
Net Sales - $300
Cost of Goods Sold - 180
Gross Profit - 120
Operating Expenses - 45
Net Income - $75
Using vertical analysis, what percentage is assigned to Net Income?
A) 625%
B) 40%
C) 25%
D) None of these answer choices are correct
7. Turnbull Department Store had net credit sales of $18,000,000 and cost of goods sold of $15,000,000 for the year. The average inventory for the year amounted to $2,500,000. The average number of days in inventory during the year was
A) 365 days.
B) 60.8 days.
C) 50.7 days.
D) 30 days.
8. Which of the following would be considered an Other Comprehensive income item?
A) Net income
B) Gain on disposal of discontinued operations
C) Other revenues and gains
D) Unrealized loss on available-for-sale securities
9. Stellar. Inc. decided on January 1 to discontinue its telescope manufacturing division. On July 1, the division's assets with a book value of $840.000 are sold for $600,000. Operating income from January 1 to June 30 for the division amounted to $130,000. Ignoring income taxes, what total amount should be reported on Stellar's income statement for the current year under the captions Discontinued Operations?
A) $130,000
B) $110,000 loss
C) $240,000 loss
D) $370,000
10. The following information pertains to Ortiz Company. Assume that all balance sheet amounts represent both average and ending balance figures. Assume that all sales were on credit.
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Assets
|
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Cash and short-term investments
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$45,000
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Accounts receivable (net)
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25,000
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Inventory
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20,000
|
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Property, plant and equipment
|
270,000
|
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Total Assets
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$360,000
|
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Liabilities and Stockholders' Equity
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Current liabilities
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$50,000
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Long-term liabilities
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90,000
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Stockholders' equity-common
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220,000
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Total Liabilities and Stockholders' Equity
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$360,000
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Income Statement
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Sales
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$150,000
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Cost of goods sold
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66,000
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Gross profit
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84,000
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Operating expenses
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29,000
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Net income
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$55,000
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Number of shares of common stock
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6,000
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Market price of common stock
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$20
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Dividends per share
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.50
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What is the return on common stockholders' equity for Ortiz?
A) 25%
B) 50%
C) 12.5%
D) 15.3%
Part B -
1. Managerial accounting applies to each of the following types of businesses except
A) Service firms.
13) Merchandising firms.
C) Manufacturing firms.
D) Managerial accounting applies to all types of firms.
2. Managerial accounting information is generally prepared for
A) Stockholders.
B) Creditor.,
C) Managers.
D) Regulatory agencies.
3. Managerial accounting information
A) Pertains to the entity as a whole and is highly aggregated.
B) Pertains to subunits of the entity and may be very detailed.
C) Is prepared only once a year
D) Is constrained by the requirements of generally accepted accounting principles.
4. Product costs consist of
A) Direct materials and direct labor only.
B) Direct materials, direct labor, and manufacturing overhead.
C) Selling and administrative expenses.
D) Period costs.
5. The product cost that is most difficult to associate with a product is
A) Direct materials.
B) Direct labor.
C) Manufacturing overhead.
D) Advertising.
6. Which one of the following represents a period cost?
A) The VP of Sales' salary and benefits
B) Overhead allocated to the manufacturing operations
C) Labor costs associated with quality control
D) Fringe benefits associated with factory workers
7. Cost of goods manufactured is calculated as follows:
A) Beginning WIP + direct materials used + direct labor + manufacturing overhead + ending WIP.
B) Direct materials used + direct labor + manufacturing overhead - beginning WIP + ending WIP.
C) Beginning WIP + direct materials used + direct labor + manufacturing overhead - ending WIP.
D) Direct materials used + direct labor + manufacturing overhead - ending WIP - beginning WIP.
8. Dolan Company's accounting records reflect the following inventories:
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Dec. 31, 2017
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Dec. 31, 2016
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Raw materials inventory
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$310,000
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$260,000
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Work in process inventory
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300,000
|
160,000
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Finished goods inventory
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190,000
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150,000
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During 2017, $800,000 of raw materials were purchased, direct labor costs amounted to $670,000, and manufacturing overhead incurred was $640,000.
Dolan Company's total manufacturing costs incurred in 2017 amounted to
A) $2,060,000.
B) $2,020,000.
C) $1,920,000.
D) $2,110,000,
9. Assuming that the cost of goods manufactured is $3,460,000 compute the cost of goods sold using the following information.
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Raw materials inventory, January 1
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$30,000
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Raw materials inventory, December 31
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60,000
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Work in process, January 1
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27,000
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Work in process, December 31
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18,000
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Finished goods, January 1
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60,000
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Finished goods, December 31
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48,000
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Raw materials purchases
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1,800,000
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Direct labor
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890,000
|
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Factory utilities
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225,000
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Indirect labor
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75,000
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Factory depreciation
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500,000
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Operating expenses
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630,000
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A) $3,469,000.
B) $3,412,000.
C) $3,448,000.
D) $3,472,000.