Accounting

Determine which of the following best describes Form 10-K. A. It must be filed annually, containing information about a company's business, financial disclosures, and legal proceedings. B. It includes additional explanations regarding the operational performance of the company over the past year. C. It gives another party the right to cast a vote. D. It is a quarterly report filed by the company. E. It must be filed for major events, such as acquisitions and matters related to accounting and financial statements.

A

Equity equals: A Assets - Liabilities B Liabilities - Assets C Assets + Liabilities D Assets x Liabilities E Assets / Liabilities

A

The assumption that the activities of a company are separate from its owners and other companies is known as: A Economic Entity Assumption B Going Concern Assumption C Monetary Unit Assumption D Periodicity Assumption

A

You are given the following financial statement for CAPM Brewing Co. The total assets for CAPM Brewing Co. equaled $750,900 at year end, and shareholders' equity was $286,000. Determine which of the following is FALSE. A. Gross Profit Margin = 23.22% B. Operating Profit Margin = 11.07% C. Net Profit Margin = 5.07% D. Return on Assets = 0.9369% E. Return on Equity = 3.46%

E. Return on Equity = 3.46%

Which of the following would likely be used to evaluate a company's current financial position? I. Balance sheet II. Income statement III. Statement of cash flows

I

Which of the following is NOT a qualitative characteristic of information in financial statement according to the Conceptual Framework for Financial Reporting (2010)? I. Full disclosure II. Faithful Representation III. Comparability

I only

Assuming no changes in other variables, which of the following would likely reduce Return on Assets? I. A decrease in the effective tax rate II. An increase in average assets III. A decrease in interest expense

II

If a company sells a building for cash, that activity would be classified as what type of activity on the cash flow statement? I. Operating II. Investing III. Financing

II

Which of the following would likely be used to evaluate a company's profitability for a period? I. Balance sheet II. Income statement III. Statement of cash flows

II

Which of the following is NOT a current asset? I. Cash II. Goodwill III. Inventories

II Only

Which of the following will most likely be classified as a current liability? I. Payment received for a product due to be delivered at least a year after the balance sheet date II. Payments for a product due at least a year after the balance sheet date but still within a normal operating cycle of business III. Payments on debt due in six months for which the company has the right to defer settlement for at least a year after the balance sheet date

II Only

"Retained earnings" is a component of: I. Assets II. Liabilities III. Shareholder's equity

III Only

Which of the following is/are attributes that will aid in making an accounting standards board successful? I. The responsibilities of all parties within the board should be clearly defined. II. There should be some dependencies between the board and external. III. High standards of ethics and confidentiality should be followed.

None of A, B, C, and D is correct.

Determine which of the following statements regarding Financial Accounting Standards Board (FASB) is FALSE. A The board is designed to be independent of the private and public business sector. B The FASB Accounting Standards Codification is the basis for International Financial Reporting Standards (IFRS). C Accounting Standards Updates amend the Codification and include​ all relevant information regarding the update. D Financial Accounting Concepts lay the foundation for the fundamental objectives and concepts FASB uses in the development of the Codification. E Even though both Accounting Standards Updates and Financial Accounting Concepts pass through the same system of due process, only Accounting Standards Updates establish U.S. generally accepted accounting principles (GAAP).

B

Providing information regarding economic entities to interested parties so that users can make economic decisions best describes the role of: A. Auditing B. Financial reporting C. Financial statement analysis D. Financial consulting E. None of (A), (B), (C), and (D) are correct.

B

The assumption that an entity will continue to operate indefinitely into the future is known as: A Economic Entity Assumption B Going Concern Assumption C Monetary Unit Assumption D Periodicity Assumption

B

The assumption that an entity will continue to operate indefinitely into the future is known as: A. Economic Entity Assumption B. Going Concern Assumption C. Monetary Unit Assumption D. Periodicity Assumption

B

Cash received from a customer for a product to be delivered in the future is recorded as: A Revenue and an asset B Revenue and a liability C An asset and a liability D None of A, B, and C is correct.

C

Which of the following ratio would an analyst most likely examine to assess a company's ability to fulfill its long-term obligations? A Activity ratios B Liquidity ratios C Solvency ratios

C

You are given the following 2019 financial information for floral retailer Dean's Blooms. All values are in millions unless otherwise noted and are values on Dec. 31, 2019. Cash: $105 Investments: $43 Accounts Receivable: $1,020 Inventory: $564 Prepaid Assets: $101 Total Current Liabilities: $1,330 The company has no other current assets on the balance sheet. Calculate the company's quick ratio. A. 0.11 B. 0.50 C. 0.88 D. 1.10 E. 1.38

C. 0.88

An investor who is concerned about a company's capital efficiency would most likely examine its: A Inventory turnover B Receivables turnover C Payable turnover D Total asset turnover E None of A, B, C, and D is correct.

D

Koster Inc. is a computer manufacturer based out of Cleveland, Ohio. During 2019, the company earned $618 million in sales with a cost of goods sold equal to 80% of revenue. For tax purposes, Koster depreciated equipment and buildings by $30 million. However, the GAAP accounting statements show Koster using straight-line depreciation totaling $15 million. All other expenses for the year are $65 million, and the corporate tax rate is 30%. Calculate the change in deferred tax asset or liability. A. 3.0 B. 3.5 C. 4.0 D. 4.5 E. 5.0

D. 4.5

An investor who is concerned about a company's solvency most likely examine its: A Current ratio B Cash ratio C Working capital turnover D Fixed asset turnover E Debt-to-equity ratio

E

Determine which of the following best describes Form 8-K. A It must be filed annually, containing information about a company's business, financial disclosures, and legal proceedings. B It includes additional explanations regarding the operational performance of the company over the past year. C It gives another party the right to cast a vote. D It is a quarterly report filed by the company. E It must be filed for major events, such as acquisitions and matters related to accounting and financial statements.

E