1. Quentin's current ratio on December 31, 2004 is:
• 1.25
• 0.80
• 0.53
• 1.125
The next 6 questions refer to Quentin Company's December 31, 2004 Balance Sheet.
2. Quentin began 2004 with the following non-current asset balances: Plant and equipment (net) $59,000; Patent (net) $28,000. No long-term assets were purchased or sold during the year. How much amortization and depreciation expense did Quentin record during 2004?
• $3,000
• $4,000
• $7,000
• Cannot be estimated
3. Quentin's 2004 net income was $5,000. No dividends were declared or paid during 2004. What was Quentin's retained earnings balance on December 31, 2003?
• $39,000
• $49,000
• $34,000
• Cannot be estimated
4. Turnadot & Sons is a small wholesaler of decorative cast iron objects. The following events, related to a special customer order, occur as described below:
August 5, 2005: Turnadot receives the special order for 200 outdoor planters at a selling price of $50 each, including delivery at a future convenient time and location. The customer, with whom Turnadot has had a long-term, trouble-free relationship, pays $3,000 as a deposit and agrees to pay the rest on delivery. Turnadot immediately orders $4,000 worth of planters from its supplier and pays a $1,000 deposit for them.
August 27, 2005: Turnadot pays $3,000 balance due to the supplier upon delivery of the planters to its warehouse.
September 5, 2005: The customer calls for delivery of the planters, and pays the balance of $7,000 when they arrive at the customer site.
What is the dollar gross margin earned by Turnadot on the special order for 200 planters?
• $2,000
• $7,000
• $9,000
• $6,000