ASHWORTH A04 ONLINE EXAM 3

Question 1 of 20                                     5.0/ 5.0 PointsCommon-size balance sheets may be used for all of the following exceptA. gaining insights into the nature of a company’s operationsB. analyzing a company’s asset and financial structureC. determining how management assesses the risks a company faces.D. learning about the underlying economics of an industryQuestion 2 of 20                                     5.0/ 5.0 PointsInvesting activities include the cash effects of:A. producing and delivering goods and servicesB. purchasing and disposing of fixed assets used in production of revenueC. borrowing and repaying loans used to purchase fixed assets.D. selling stocks and bonds to raise capital to purchase fixed assetsQuestion 3 of 20                                     5.0/ 5.0 PointsFinancing activities include the cash effects of:A. producing and delivering goods and servicesB. purchasing and disposing of fixed assets used in production of revenueC. purchasing and disposing of debt securities of other companiesD. selling stocks and bonds to raise capital for the production of revenueQuestion 4 of 20                                     5.0/ 5.0 PointsProbable future sacrifices of economic benefits arising from an entity’s present obligations to transfer resources or provide services to other entities in the future as a result of past transactions or events define:A. assetsB. liabilitiesC. equity.D. retained earningsQuestion 5 of 20                                     5.0/ 5.0 PointsThe Common Stock account is reported on the balance sheet at the:A. historical par value of the stockB. current market value of the stockC. net realizable value of the stockD. discounted present value of the future dividends`Question 6 of 20                                     5.0/ 5.0 Points
How much cash did Kris collect from customers during Year 2? Assume all sales are on credit.A. $150,000B. $750,000C. $850,000D. $900,000$900,000 sales – $50,000 increase in A/R = $850,000Question 7 of 20                                     5.0/ 5.0 PointsCurrent liabilities are reported on the balance sheet at:A. current market value.B. historical cost.C. discounted present valueD. future valueQuestion 8 of 20                                     5.0/ 5.0 PointsThe Additional Paid-In Capital account is reported on the balance sheet at the __________ minus par value.A. current market value of the stockB. historical sales price of the stockC. net realizable value of the stockD. discounted present value of the future dividendsQuestion 9 of 20                                     5.0/ 5.0 PointsCompanies that are considered to be in stronger financial health and better credit risks are able to satisfy most of their cash needs from __________ activitiesA. operatingB. investingC. financingD. investing and financingQuestion 10 of 20                                     5.0/ 5.0 PointsThe amount of income taxes recognized on the income statement but NOT yet payable to the government are found on the:A. balance sheet in the account Deferred Income Taxes.B. balance sheet in the account Income Taxes Payable.C. income statement in the account Income Tax Expense Current.D. income statement in the account Income Tax Expense DeferredQuestion 11 of 20                                     5.0/ 5.0 PointsWhich one of the following equations explains why successive balance sheets can be used to prepare a firm’s cash flow statement?A. Assets = Liabilities – EquityB. Cash – Noncash assets = Liabilities – EquityC.  Cash =  Liabilities –   Noncash assets +  Stockholders’ equityD.  Cash =  Liabilities +  Stockholders’ equityQuestion 12 of 20                                     5.0/ 5.0 PointsRetained earnings are reported on the balance sheet at:A. historical cost.B. current market value.C. net realizable value.D. a mixture of different measurement basesQuestion 13 of 20                                     5.0/ 5.0 PointsHow far into the future the obligations of a company will come due refers to the company’s:A. capital structureB. maturity structureC. solvencyD. liquidityQuestion 14 of 20                                     5.0/ 5.0 PointsIn a common-size balance sheet, each balance sheet account is expressed as a percentage of total:A. liabilitiesB. assetsC. shareholders’ equityD. assets plus shareholders’ equityQuestion 15 of 20                                     5.0/ 5.0 PointsInventories are reported on the balance sheet at:A. current market valueB. historical costC. net realizable valueD. the lower of cost or marketQuestion 16 of 20                                     5.0/ 5.0 PointsHow much cash did Barden pay for rent during Year 4?A. $0B. $15,000C. $25,000D. $40,000$25,000 rent expense – $25,000 decrease in prepaid rent = $0Question 17 of 20                                     5.0/ 5.0 PointsOperating activities result from the cash effects of:A. producing and delivering goods and servicesB. purchasing and disposing of fixed assets used in production of revenueC. borrowing and repaying loans used in the production of revenueD. selling stocks and bonds to raise capital for the generation of revenueQuestion 18 of 20                                     5.0/ 5.0 PointsAll of the following disclosures would appear in the Summary of Significant Accounting Policies EXCEPT the __________ methodA. inventoryB. depreciationC. long-term construction contractD. financingQuestion 19 of 20                                     5.0/ 5.0 PointsThe balance sheet amount reported for a long-term debt on the issue date is the:A. discounted present value of the future principal repaymentB. discounted present value of the periodic interest paymentsC. sum of the future value of principal repayment and the periodic interest payments.D. sum of the discounted present values of the future principal repayments and the periodic interest payments.Question 20 of 20                                     5.0/ 5.0 PointsCurrent assets are assets expected to:A. be converted to cash within twelve monthsB. be converted to cash within twelve months or one operating cycle if it is longer than twelve monthsC. remain on the books for at least twelve monthsD. remain on the books for at least twelve months or one operating cycle if longer than twelve months