| Question 1 | 5 / 5 points |
Use the information below to answer the following question.
ABC Company purchases five products for sale in the order and at the costs shown below.
| Unit | Cost per Unit |
| 1 | $10 |
| 2 | $12 |
| 3 | $15 |
| 4 | $18 |
| 5 | $13 |
Assume ABC uses the average cost method of inventory valuation. What unit cost would be used to determine the amount in ending inventory or cost of goods sold?
Question options:
|
| $12.67 | ||
|
| $13.60 | ||
|
| $15.00 | ||
|
| $13.00 | ||
| Question 2 | 5 / 5 points | ||
When will a firm regard goodwill on its books?
Question options:
|
| When one company acquires another company for a price in excess of the fair market value of the net identifiable assets acquired. | ||
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| When the firm donates property to charities. | ||
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| When it is determined that there has been a loss of value of long-term assets. | ||
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| When fixed assets are impaired. | ||
| Question 3 | 5 / 5 points | ||
Assume the following purchases of inventory for ABC Company and use this information to answer the question below.
ABC Company purchases five products for sale in the order and at the costs shown below.
| Purchase # | Purchase Price |
| 1 | $3 |
| 2 | $4 |
| 3 | $5 |
| 4 | $6 |
| 5 | $7 |
Assume ABC sells three items and uses the LIFO method of inventory valuation. What amount would appear for cost of goods sold on the income statement?
Question options:
|
| $18 | ||
|
| $12 | ||
|
| $15 | ||
|
| $25 | ||
| Question 4 | 5 / 5 points | ||
Which of the following statements is true?
Question options:
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| Land should be depreciated over the period of time it benefits the firm. | ||
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| Accelerated depreciation must be used for financial reporting purposes. | ||
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| Fixed assets are reported at historical cost plus accumulated depreciation. | ||
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| The total amount of depreciation over the asset's life is the same regardless of depreciation method, although the rate of depreciation varies. | ||
| Question 5 | 5 / 5 points | ||
Which stockholders' equity account represents the sum of every dollar a company has earned since its inception, less any payments made to shareholders in the form of dividends?
Question options:
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| Treasury stock | ||
|
| Accumulated other comprehensive income | ||
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| Retained earnings | ||
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| Preferred stock | ||
| Question 6 | 5 / 5 points | ||
__________ is (are) a form of vertical ratio analysis that allows for comparison of firms with different levels of sales or total assets by introducing a common denominator.
Question options:
|
| Consolidated statements | ||
|
| Common size financial statements | ||
|
| Income Statements | ||
|
| Comparative Data Statements | ||
| Question 7 | 5 / 5 points | ||
Which of the following accounts would be classified as current assets on the balance sheet?
Question options:
|
| Accounts receivable, inventory, cash equivalents | ||
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| Marketable securities, accounts payable, property, plant and equipment | ||
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| Prepaid expenses, goodwill, long-term investments | ||
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| Property, plant and equipment, inventory, goodwill | ||
| Question 8 | 5 / 5 points | ||
__________ include those assets expected to be converted into cash within one year or operating cycle.
Question options:
|
| Current assets | ||
|
| Long-term assets | ||
|
| Current liabilities | ||
|
| Long-term liabilities | ||
| Question 9 | 5 / 5 points | ||
What does the term "net realizable value" mean with regard to the accounts receivable account?
Question options:
|
| The gross amounts owed by customers for credit purchases | ||
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| Total accounts receivable plus an amount estimated for bad debts | ||
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| The allowance for doubtful accounts less bad debt expense | ||
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| Actual amounts of accounts receivable less an allowance for doubtful accounts | ||
| Question 10 | 5 / 5 points | ||
Marketable securities are also referred to as __________ investments.
Question options:
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| guaranteed | ||
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| high risk/low return | ||
|
| long-term | ||
|
| short-term | ||
| Question 11 | 5 / 5 points | ||
Which of the following marketable securities are reported at fair value?
Question options:
|
| Held to maturity and trading securities | ||
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| Trading securities and securities available for sale | ||
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| Held to maturity and securities available for sale | ||
|
| Corporate bonds and convertible debt | ||
| Question 12 | 5 / 5 points | ||
Use the information below to answer the following question.
ABC Company purchases five products for sale in the order and at the costs shown below.
| Unit | Cost per Unit |
| 1 | $10 |
| 2 | $12 |
| 3 | $15 |
| 4 | $18 |
| 5 | $13 |
Assume ABC sells two items and uses the FIFO method of inventory valuation. What amount would appear in ending inventory on the balance sheet?
Question options:
|
| $22 | ||
|
| $46 | ||
|
| $45 | ||
|
| $31 | ||
| Question 13 | 5 / 5 points | ||
__________ are the combined financial statements of separate legal entities when the parent controls 100% of the subsidiary.
Question options:
|
| Income statements | ||
|
| Balance sheet statements | ||
|
| Consolidated statements | ||
|
| Stockholder's equity statements | ||
| Question 14 | 5 / 5 points | ||
Which of the following items would NOT be considered when analyzing accounts receivable and allowance for doubtful accounts?
Question options:
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| The relationship among changes in sales, accounts receivable and the allowance for doubtful accounts | ||
|
| A comparison of actual write-offs relative to amounts recognized as bad debts | ||
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| The relationship between accounts receivable, inventory, and accounts payable | ||
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| An analysis of the "Valuation and Qualifying Accounts" schedule required in the Form 10-K | ||
| Question 15 | 5 / 5 points | ||
__________ are balances owed to suppliers.
Question options:
|
| Assets | ||
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| Liabilities | ||
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| Owner's Equity | ||
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| Securities | ||
| Question 16 | 5 / 5 points | ||
Which method of inventory assumes the last units purchased will remain in ending inventory on the balance sheet?
Question options:
|
| FIFO | ||
|
| LIFO | ||
|
| Average cost | ||
|
| LIFO and FIFO | ||
| Question 17 | 5 / 5 points | ||
The balance sheet shows the financial position of a company:
Question options:
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| for a month. | ||
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| for a quarter. | ||
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| for a year. | ||
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| for a particular date. | ||
| Question 18 | 5 / 5 points | ||
Which of the following statements is FALSE?
Question options:
|
| Goodwill arises when one company acquires another company for a price in excess of the fair market value of the net identifiable assets acquired. | ||
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| Goodwill should be depreciated. | ||
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| Goodwill must be evaluated annually to determine if there has been a loss of value. | ||
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| If the carrying value of goodwill exceeds the fair value, the excess book value must be written off as an impairment expense. | ||
| Question 19 | 5 / 5 points | ||
The inventory of a retail company is comparable to which type of inventory of a manufacturing company?
Question options:
|
| Finished goods | ||
|
| Work in process | ||
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| Supplies | ||
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| Raw materials | ||
| Question 20 | 5 / 5 points | ||
Marketable securities should be valued:
Question options:
|
| at fair market value. |
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| below market value. |
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| equal to market value. |
|
| cautiously. |
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