30 Dec Prepaid expenses

Question 1

1 out of 1 points

________ are normally classified as a current liability on the balance sheet.

Prepaid expenses

Land

Inventories

Accounts payable

Question 2

1 out of 1 points

may produce a positive balance in retained earnings

will restate retained earnings to zero.

should appear on the income statement as part of continuing operations

requires the approval of a bankruptcy court

Question 3

1 out of 1 points

If the Investor Company owns 20% of the stock of Investee Company and Investee Company reports profits of $100,000, then Investor Company reports equity income of:

$80,000

$20,000

$40,000

$60,000

Question 4

1 out of 1 points

Which of the following is seldomly a preferred stock characteristic?

voting rights

call ability by the issuer

accumulation of dividends

preference in liquidation

Preferred stock does have :

Preference as to dividends

Accumulation of dividends

Participation in excess of stated dividend rate

Convertibility into common stock

Callability by the corporation

Redemption at future maturity date ( see the previous discussion of redeemable preferred stock)

Preference in liquidation

Question 5

1 out of 1 points

Gross profit is the difference between:

net income and operating income

revenues and expenses

sales and cost of goods sold

gross sales and sales discounts

Question 6

1 out of 1 points

Employee Stock Ownership Plans (ESOPs):

will not dilute the proportional ownership of existing shareholders.

may be created for a temporary purpose.

do not produce any tax advantages for plan participants.

may borrow funds from a bank.

Question 7

1 out of 1 points

Which of the following will be disclosed in the reconciliation of retained earnings?

net income / net loss

adjustment for an error of a prior period

dividends

all of the answers are

Question 8

1 out of 1 points

Which of the following would be classified as an extraordinary item on the income statement?

loss on disposal of a segment of business

a sale of land

loss on disposal of a segment of business

a loss from a flood in a location that would not be expected to flood

Question 9

1 out of 1 points

________ is considered a tangible asset.

Equipment

A patent

A copyright

Goodwill

Question 10

0 out of 1 points

The following relate to Data Original in 2008. What is the ending inventory?

Purchases

$540,000

Beginning Inventory

80,000

Customer Returns

10,000

Sales

800,000

Cost of Goods Sold

490,000

a.

$120,000

b.

$140,000

c.

$210,000

d.

$260,000