Accounting Chapter 2

For 2022, Metlock, Inc. reported net income of $ 42300, had average share outstanding of 15100, paid preferred dividends of $ 12700and common dividends were of $ 5300. What was 2022 earnings per share? $ 0.49 $ 1.96 $ 0.04 $ 24.96

$ 1.96

For 2022, Blossom Company reported net income of $ 36000, net sales $ 420000, and average share outstanding of 15500. No preferred dividends were paid. Earnings per share is $ 0.16 $ 2.32 $ 0.51 $ 25.07

$ 2.32

Which of the following is a constraint in accounting? Cost Consistency Relevance Comparability

Cost

Which one of the following is true? Current assets are assets that a company expects to convert to cash or use up within the longer of one year or its operating cycle. Obligations expected to be paid after one year are classified as expenses. Property, plant, and equipment are assets with relatively long useful lives that are held for resale purposes. Intangible assets are current assets that do not have physical substance.

Current assets are assets that a company expects to convert to cash or use up within the longer of one year or its operating cycle.

Which accounting assumption assumes that an enterprise will continue in operation long enough to carry out its existing objectives and commitments? Periodicity assumption Monetary unit assumption Economic entity assumption Going concern assumption

Going concern assumption

In which balance sheet section would trademarks be reported? Property, plant, and equipment Investments Intangible assets Current assets

Intangible assets

Which statement describes the periodicity assumption? Every economic unit can be separately identified and accounted for. The business will remain in operation for the foreseeable future. The life of a business can be divided into artificial times periods for which useful reports can be prepared. Financial reports are issued on a timely basis for decision-making.

The life of a business can be divided into artificial times periods for which useful reports can be prepared.

What is the role of the FASB? To regulate foreign companies that do business in the U.S. To regulate U.S. financial markets and accounting standard-setting bodies To determine auditing standards in the U.S. To establish accounting standards in the U.S.

To establish accounting standards in the U.S.

The periodicity assumption states that the economic life of a business can be divided into cyclical time periods. perpetual time periods. equal time periods. artificial time periods.

artificial time periods.

The assumption that requires only those things that can be expressed in money are included in the accounting records is the periodicity assumption. economic entity assumption. going concern assumption. monetary unit assumption.

monetary unit assumption.

Which accounting assumption requires that only those things that can be expressed in dollar values are included in the accounting records? historical cost principle. periodicity assumption. monetary unit assumption. full disclosure principle.

monetary unit assumption.

Buildings are classified on the balance sheet as property, plant, and equipment. a current asset. an intangible asset. a long-term investment.

property, plant, and equipment.

The classified balance sheet is required under IFRS with certain variations in format as compared to GAAP. required under IFRS but not under GAAP. required under GAAP but not under IFRS. required under IFRS in the same format as under GAAP.

required under IFRS with certain variations in format as compared to GAAP.

he historical cost principle requires that when assets are acquired, they be recorded at fair market value. selling price. the amount paid for them. list price.

the amount paid for them.

Liabilities are generally classified on a balance sheet as current liabilities and long-term liabilities. small liabilities and large liabilities. present liabilities and future liabilities. tangible liabilities and intangible liabilities.

current liabilities and long-term liabilities.

The accounting concept that indicates assets should be reported at the price received to sell an asset is the historical cost principle. economic entity assumption. monetary unit assumption. fair value principle.

fair value principle.

On a classified balance sheet, companies usually list current assets with the largest dollar amounts first. in alphabetical order. in the order in which they are expected to be converted into cash. in the order of acquisition.

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

An item is considered material if it does not cost a lot of money. it is of a tangible good. the cost of reporting the item is greater than its benefits. its size is likely to influence the decision of an investor or creditor.

its size is likely to influence the decision of an investor or creditor.

Which of the following is generally not classified as a current liability? Accounts Payable Salaries and Wages Payable Taxes Payable Bonds Payable

Bonds Payable

A company using the same accounting principles from year to year is an application of timeliness. consistency. full disclosure. materiality.

consistency.

On a classified balance sheet, short-term investments are classified as property, plant, and equipment. current assets. intangible assets. long-term investments.

current assets.

In a classified balance sheet, assets are usually classified as current assets; long-term investments; property, plant, and equipment; and intangible assets. current assets; long-term investments; property, plant, and equipment; and common stocks. current assets; long-term investments; tangible assets; and intangible assets. current assets; long-term assets; property, plant, and equipment; and intangible assets.

current assets; long-term investments; property, plant, and equipment; and intangible assets.