Assignment
Question 1
Which of the following is not a difference between the audit report of a nonpublic and public company?
The public company report includes the word "Registered" in the title.
The public company report has an additional paragraph referring to the client's fraud prevention procedures.
The public company report refers to standards of the PCAOB.
The public company report is shorter.
Question 2
The term marketing mix describes:
a series of business decisions that aid in selling a product.
the relationship between a firm's marketing strengths and its business weaknesses.
a blend of the four strategic marketing elements to satisfy specific target markets.
a composite analysis of all environmental factors inside and outside the firm.
Question 3
Which of the following is not a major challenge facing the accounting profession?
Nonfinancial measurements
Forward-looking information
Timeliness
Accounting for hard assets
Question 4
The group of people to whom a firm directs its marketing efforts and ultimately its merchandise is known as its __________ market.
undifferentiated
unsegmented
target
mass
Question 5
On October 1, 2014, Menke Company purchased to hold to maturity 400, $1,000, 9% bonds for $416,000. An additional $12,000 was paid for accrued interest. Interest is paid semiannually on December 1 and June 1, and the bonds mature on December 1, 2018. Menke uses straight-line amortization. Ignoring income taxes, the amount reported in Menke's 2014 income statement from this investment should be:
$9,960.
$10,920.
$9,000.
$8,040.
Question 6
The information provided by financial reporting pertains to:
business industries, rather than to individual enterprises or an economy as a whole or to members of society as consumers.
an economy as a whole and to members of society as consumers, rather than to individual enterprises or industries.
individual business enterprises, industries, and an economy as a whole, rather than to members of society as consumers.
individual business enterprises, rather than to industries or an economy as a whole or to members of society as consumers.
Question 7
Which of the following is a fundamental quality of useful accounting information?
Relevance
Comparability
Materiality
Neutrality
Question 8
Which of the following items, if any, is deductible?
Substantiated gambling losses (not in excess of gambling winnings) from state lottery
Parking expenses incurred in connection with jury duty - taxpayer is a dentist
Speeding ticket incurred while on business
Contributions to mayor's reelection campaign
Premiums paid on personal life insurance policy
Question 9
Gross billings for merchandise sold by Lang Company to its customers last year amounted to $11,720,000; sales returns and allowances were $370,000, sales discounts were $175,000, and freight-out was $140,000. Net sales last year for Lang Company were:
$11,035,000.
$11,720,000.
$11,350,000.
$11,175,000.
On January 1, 2015, Gridley Corporation had 250,000 shares of its $2 par value common stock outstanding. On March 1, Gridley sold an additional 500,000 shares on the open market at $20 per share. Gridley issued a 20% stock dividend on May 1. On August 1, Gridley purchased 280,000 shares and immediately retired the stock. On November 1, 400,000 shares were sold for $25 per share. What is the weighted-average number of shares outstanding for 2015?
750,000
344,444
1,020,000
477,777
Question 11
If the price of Pepsi increases, then there will be __________ of Pepsi.
an increase in the supply
a decrease in the supply
an increase in the quantity supplied
a decrease in the quantity supplied
Question 12
Trade restrictions such as tariffs and import quotas represent:
an attempt by the government to bring about a more equitable distribution of income.
a subsidy paid by domestic consumers to foreign producers of the duty-burdened commodities.
a subsidy paid by domestic consumers to domestic producers of the duty-burdened commodities.
an increase in the unit costs of domestic producers who compete with foreign firms.
Question 13
Which of the following is an example of managing earnings down?
Changing estimated bad debts from 3 percent to 2.5 percent of sales
Revising the estimated life of equipment from 10 years to 8 years
Reducing research and development expenditures
Not writing off obsolete inventory
Question 14
A series of equal receipts at equal intervals of time when each receipt is received at the beginning of each time period is called an:
annuity due.
annuity in arrears.
ordinary annuity.
unearned receipt.
Question 15
How do you determine the acid-test ratio?
Current assets divided by short-term debt
The sum of cash and short-term investments divided by short-term debt
The sum of cash, short-term investments, and net receivables divided by current liabilities.
Current assets divided by current liabilities
Question 16
Turner Corporation had the following information in its financial statements for the year ended 2014 and 2015:
Cash dividends for the year 2015: $15,000
Net income for the year ended 2015: $130,000
Market price of stock, 12/31/15: $24
Common stockholders' equity, 12/31/14: $2,200,000
Common stockholders' equity, 12/31/15: $2,400,000
Outstanding shares, 12/31/15: $150,000
Preferred dividends for the year ended 2015: $30,000
What is the book value per share for Turner Corporation for the year ended 2015?
$15.80
$14.67
$16.00
Question 17
The statement of cash flows reports all of the following except:
the net change in cash for the period.
the free cash flows generated during the period.
the cash effects of operations during the period.
investing transactions.
Question 18
Which of the following transactions would require the use of the present value of an annuity due concept in order to calculate the present value of the asset obtained or liability owed at the date of incurrence?
A capital lease is entered into with the initial lease payment due upon the signing of the lease agreement.
A ten-year 8% bond is issued on January 2 with interest payable semiannually on July 1 and January 1 yielding 7%.
A capital lease is entered into with the initial lease payment due one month subsequent to the signing of the lease agreement.
A ten-year 8% bond is issued on January 2 with interest payable semiannually on July 1 and January 1 yielding 9%.
Question 19
Turner Corporation had the following information in its financial statements for the year ended 2014 and 2015:
Cash dividends for the year 2015: $15,000
Net income for the year ended 2015: $130,000
Market price of stock, 12/31/15: $24
Common stockholders' equity, 12/31/14: $2,200,000
Common stockholders' equity, 12/31/15: $2,400,000
Outstanding shares, 12/31/15: $150,000
Preferred dividends for the year ended 2015: $30,000
What is the payout ratio for Turner Corporation for the year ended 2015?
15.0%
11.5%
34.6%
23.1%
Question 20
Net cash provided by operating activities divided by average total liabilities equals the:
cash debt coverage.
free cash flow.
current ratio.
current cash debt coverage.
Question 21
Which of the following capital budgeting techniques should be used to make most investment decisions?
Breakeven Point
NPV
Payback
Discounted Payback
Question 22
Stine Inc. had 500,000 shares of common stock issued and outstanding at December 31, 2014. On July 1, 2015, an additional 500,000 shares were issued for cash. Stine also had stock options outstanding at the beginning and end of 2015 which allow the holders to purchase 150,000 shares of common stock at $28 per share. The average market price of Stine's common stock was $35 during 2015. The number of shares to be used in computing diluted earnings per share for 2015 is:
870,000
1,030,000
1,120,000
780,000
Question 23
The accounts receivable turnover ratio measures the:
number of times the average balance of inventory is sold during the period.
percentage of accounts receivable turned over to a collection agency during the period.
percentage of accounts receivable arising during certain seasons.
number of times the average balance of accounts receivable is collected during the period.
Question 24
Hill Corp. had 600,000 shares of common stock outstanding on January 1, issued 900,000 shares on July 1, and had income applicable to common stock of $1,470,000 for the year ending December 31, 2014. Earnings per share of common stock for 2014 would be:
$2.45
$1.40
$1.16
$1.64
Question 25
At December 31, 2014, Hancock Company had 500,000 shares of common stock issued and outstanding, 400,000 of which had been issued and outstanding throughout the year and 100,000 of which were issued on October 1, 2014. Net income for the year ended December 31, 2014, was $1,360,000. What should be Hancock's 2014 earnings per common share, rounded to the nearest penny?
$3.40
$3.20
$3.03
$2.69.