Accounting Exam 1 review

Long-term creditors are usually most interested in evaluating

Solvency

For 2022, Windsor, Inc. reported net income of $42500, had average share outstanding of 15700, paid preferred dividends of $11800 and common dividends were of $5900. What was 2022 earnings per share? $24.96 $1.96 $0.04 $0.49

$1.96

Marigold Corp. began the year by issuing $112000 of common stock for cash. The company recorded revenues of $1100000, expenses of $951000, and paid dividends of $55000. What was Marigold's net income for the year? $261000 $206000 $94000 $149000

$149000

These are selected account balances on December 31, 2022. Land $145000 Land (held for future use) 244500 Buildings 1033000 Inventory 299000 Equipment 655000 Furniture 153000 Accumulated Depreciation 450000 What is the total amount of property, plant, and equipment that will appear on the balance sheet? $2061000 $1536000 $1780500 $2511000

$1536000

At December 1, 2022, Windsor, Inc. Accounts Receivable balance was $14450. During December, Windsor had credit sales of $38700 and collected accounts receivable of $30960. At December 31, 2022, the Accounts Receivable balance is $53150 debit $14450 debit $22190 debit $22190 credit

$22190 credit

At February 1, 2022, the balance in Kingbird, Inc. supplies account was $3990. During February Kingbird purchased supplies of $3420 and used supplies of $4560. At the end of February, the balance in the Supplies account should be $3990 debit. $5130 credit. $2850 debit. $11970 debit.

$2850 debit

Metlock, Inc. started the year with total assets of $308000 and total liabilities of $248000. During the year the business recorded $630000 in revenues, $333000 in expenses, and dividends of $63000. Stockholders' equity at the end of the year was $294000. $357000. $231000. $264000.

$294000

Nash's Trading Post, LLC's trial balance reported the following balances at the end of its first year: Cash $10360 Prepaid insurance 520 Accounts receivable 2590 Accounts payable 2070 Notes payable 3110 Common stock 4000 Dividends 520 Revenues 21460 Expenses 12950 What amount did Nash's Trading Post, LLC's trial balance show as total credits? $30640 $31680 $31160 $30120

$30640

Use the following data to determine the total amount of working capital. Novak Corp. Balance Sheet December 31, 2022 Cash $189000 Accounts payable $206000 Accounts receivable 146000 Salaries and wages payable 25000 Inventory 155000 Mortgage payable 246000 Prepaid insurance 94800 Total liabilities $477000 Stock investments 264000 Land 255000 Buildings $314000 Common stock $343800 Less: Accumulated depreciation (60000) 254000 Retained earnings 744000 Goodwill 207000 Total stockholders' equity $1087800 Total assets $1564800 Total liabilities and stockholders' equity $1564800 $383800 $123800 $173800 $353800

$353800

Based on the following data, what is the amount of current assets? Accounts payable $60000 Accounts receivable 109000 Cash 74000 Intangible assets 109000 Inventory 133000 Long-term investments 161000 Long-term liabilities 214000 Short-term investments 78000 Notes payable 57500 Property, plant, and equipment 1340000 Prepaid insurance 1900 $262900 $237900 $261000 $395900

$395900

The Cash account balance of Bramble Corp. at July 1 is $490. The total of the debit entries to the Cash account amounted to $1470 and the total of the credit entries to the Cash account amounted to $1470 during July. At the end of the month, the Cash account has a $490 credit balance. $1470 credit balance. $490 debit balance. $1960 debit balance.

$490 debit balance

During September 2022, Crane Diner's total liabilities decreased by $70000 and its stockholders' equity increased by $18000. The company's total assets must change by what amount and in what direction during that same period? $52000 increase $88000 increase $70000 increase $52000 decrease

$52000 decrease

Use the following data to determine the total dollar amount of assets to be classified as property, plant, and equipment. Tamarisk, Inc. Balance Sheet December 31, 2022 Cash $195000 Accounts payable $200000 Accounts receivable 153000 Salaries and wages payable 29500 Inventory 151000 Mortgage payable 229500 Prepaid insurance 90900 Total liabilities $459000 Stock investments 261000 Land 268000 Buildings $324000 Common stock $409900 Less: Accumulated depreciation (55000) 269000 Retained earnings 735000 Goodwill 216000 Total stockholders' equity $1144900 Total assets $1603900 Total liabilities and stockholders' equity $1603900 $1002000 $537000 $753000 $592000

$537000

Use the following data to determine the total dollar amount of assets to be classified as current assets. Oriole Company Balance Sheet December 31, 2022 Cash $185000 Accounts payable $207000 Accounts receivable 140000 Salaries and wages payable 25000 Inventory 162000 Mortgage payable 231500 Prepaid insurance 93000 Total liabilities $463500 Stock investments 270000 Land 292000 Buildings $303000 Common stock $406000 Less: Accumulated depreciation (62500) 240500 Retained earnings 735000 Goodwill 222000 Total stockholders' equity $1141000 Total assets $1604500 Total liabilities and stockholders' equity $1604500 $418000 $487000 $850000 $580000

$580000

Whispering Winds Corp. compiled the following financial information as of December 31, 2022: Service revenue $836000 Common stock 186000 Equipment 244000 Operating expenses 736000 Cash 215000 Dividends 60000 Supplies 30000 Accounts payable 111000 Accounts receivable 91000 Retained earnings, 1/1/22 447000 Whispering's assets on December 31, 2022 are: $580000. $1420000. $488000.

$580000

Blue Spruce Corp. compiled the following financial information as of December 31, 2022: Service revenue $840000 Common stock 190000 Equipment 254000 Operating expenses 727000 Cash 205000 Dividends 64000 Supplies 30000 Accounts payable 109000 Accounts receivable 90000 Retained earnings, 1/1/22 451000 Blue's stockholders' equity on December 31, 2022 is: $660000. $481000. $690000. $731000.

$690000

During February 2022, its first month of operations, the owner of Coronado Industries invested cash of $94000. Coronado had cash sales of $18800 and paid expenses of $32900. Assuming no other transactions impacted the cash account, what is the balance in Cash at February 28, 2022? $14100 credit $79900 debit $61100 credit $112800 debit

$79900 debit

At October 1, 2022, Blue Spruce Corp. had an Accounts Payable balance of $162400. During the month, the company made purchases on account of $116000 and made payments on account of $185600. At October 31, 2022, the Accounts Payable balance is $23200 credit $162400 debit $185600 credit $92800 credit

$92800 credit

Sheffield Corp. began the year with retained earnings of $116000. During 2022, the company issued $79000 of common stock for cash. The company recorded revenues of $760000, expenses of $661000, and paid dividends of $45000. What was Sheffield's net income for the year 2022? $99000 $178000 $133000 $54000

$99000

Use the following data to calculate the current ratio. Tamarisk, Inc. Balance Sheet December 31, 2022 Cash $125200 Accounts payable $167000 Accounts receivable 124000 Salaries and wages payable 32500 Inventory 213200 Note payable (due 2025) 274200 Short-term investments 91600 Total liabilities $473700 Land (held for future use) 259000 Land 283500 Buildings $336500 Common stock $363500 Less: Accumulated depreciation (57300) 279200 Retained earnings 740500 Franchise 202000 Total stockholders' equity $1104000 Total assets $1577700 Total liabilities and stockholders' equity $1577700 1.24 : 1 3.29 : 1 2.78 : 1 2.32 : 1

2.78:1

Using the following balance sheet and income statement data, what is the debt to assets ratio? Current assets $31500 Net income $41100 Current liabilities 15400 Stockholders' equity 79400 Average assets 162500 Total liabilities 42300 Total assets 114000 Average common shares outstanding was 15500. 15 percent 28 percent 37 percent 70 percent

37 percent

In the annual report, where would a financial statement reader find out if the company's financial statements give a fair depiction of its financial position and operating results? Notes to the financial statements Auditor's report Balance sheet Management discussion and analysis section

Auditors report

Which of the following statements is true? Amounts paid out as dividends are not expenses. Amounts received from issuing stock are revenues. Amounts received from issued stock are reported on the income statement. Amounts paid out as dividends are reported on the income statement.

Amounts paid out as dividends are not expenses

Skysong, Inc. provided consulting services and billed the client $2050. As a result of this event, total assets remained unchanged. equity increased by $2050 assets increased by $2050. both assets and equity increased by $2050.

Both assets and equity increased by $2050

Liabilities of a company are owed to owners. stockholders. debtors. creditors.

Creditors

To show how successfully your business performed during a period of time, you would report its revenues and expenses in the income statement. retained earnings statement. statement of cash flows. balance sheet.

Income statement

Which financial statement is prepared first? Balance sheet Retained earnings statement Statement of cash flows Income statement

Income statement

Collection of a $680 Accounts Receivable increases an asset $680; decreases a liability $680. increases an asset $680; decreases an asset $680. decreases an asset $680; decreases a liability $680. decreases a liability $680; increases stockholders' equity $680.

Increases an asset $680; decreases an asset $680

Splish Brothers Inc. purchased equipment for $56000, paying cash of $5400 and signing a note payable for the balance due. This transaction increases assets, liabilities and stockholder's equity. increases assets and liabilities; decreases stockholders' equity. increases assets and liabilities. has no effect on the basic accounting equation.

Increases assets and liabilities

Which of the following is not one of the three forms of business organization? Corporations,Investors, Partnerships, Propietership

Investors

Financing Activity

Issuing shares of stock in exchange for cash

Profitability Ratios

Ratios that measure the income or operating success of a company for a given period of time are

Which of the following is an advantage of corporations relative to partnerships and sole proprietorships? Lower taxes, harder to transfer ownership, reduced legal liability for investors, most common form of organization

Reduced legal liability for investors

During January 2022, Waterway Industries paid a cash dividends of $2200. This transaction reduces net income by $2200. increases expenses by $2200. reduces stockholders' equity by $2200. increases stockholders' equity by $2200.

Reduces stockholders' equity by $2200

An expense

The cost of assets consumed or services used

Liquidity

The relationship between current assets and current liabilities is important in evaluating a company's

On a classified balance sheet, companies usually list current assets

in the order in which they are expected to be converted into cash

A business organized as a corporation

is owned by its stockholders

Accounts Receivable

the right to receive money in the future