单选题
Given the following data what is the ending inventory value using the
LIFO method?
Purchases
Sales
50 units at $50/unit
25 units at $55/unit
60 units at $45/unit
30 units at $50/unit
70 units at $40/unit
45 units at $45/unit
A. $ 3250.
B. $ 3200.
C. $ 3850.
【正确答案】
C
【答案解析】Purchased 50 +60 +70 = 180 units. Sold 25 +30 +45 = 100.
Ending inventory = 180 100 = 80 of the first units purchased.
(50 units)( $ 50/unit) + (30 units)( $ 45/unit) = $2500 + $ 1350 = $3850.
单选题
A firm pays accrued wages with cash. Assuming a current ratio and a
quid (acid test) ratio that are both greater than 1.0, what will be the
impact on the current ratio, the quick ratio and net income?
Current ratio Quick ratio Net
income ①A. Decrease
Decrease Decrease ②B.
Decrease Increase Increase
③C. Increase Increase
Stay the same
A. ①
B. ②
C.③
【正确答案】
C
【答案解析】Assume a current ratio of 2/1 and a quick ratio of 1.2/1. Now deduct 0.5 from both the numerator and the denominator and that leaves 1.5/0.5 and 0.7/0.5 for a current ratio of 3.0 and a quick ratio of 1.4. Net income will not be affected.
单选题
Which of the following activities would appear as a source of'
funds on the Statement of Cash Flows?
A. Inventory is increased.
B. A decrease in accounts payable.
C. Depreciation expense.
【正确答案】
C
【答案解析】Depreciation is a source of funds because it is a non-cash expense added back to net income. The other items are uses(i, e. a decrease) of funds.
单选题
Use the following financial data for Moose Printing Corporation to
calculate the cash flow from operations (CFO) using the indirect
method. Net income $ 225 Increase m accounts
receivable 55 Decrease m inventory 33
Depreciation 65 Decrease in accounts payable 25
Increase m wages payable 15 Decrease m deferred taxes
10 Purchase of new equipment 65 Dividends paid
75
A. Increase in cash of $183.
B. Increase in cash of $ 173.
C. Increase in cash of $ 248.
【正确答案】
C
【答案解析】CFO for Moose Printing Corporation is calculated as follows:
Net Income $ 225 A/R $ 55 + Inventory $ 33 + Depreciation $ 65 A/P $ 25 + Wages Payable $15 -Deferred taxes $10 = $ 248.
The purchase of new equipment would be an investing activity and, therefore, would not be ineluded in the CFO. Dividends paid would be a financing activity and would not be included in the CFO.
单选题
Which of the following statements about the percentage-of-completion
and completed contract methods is FALSE? The completed contract method will
produce:
A. the same cash flows as that using the percentage-of-completion
method.
B. smaller net worth and retained earnings than using the
percentage-of-completion method.
C. greater net income in the periods before construction is completed, but
not at the end of the contract, than using the percentage-of-completion
method.
【正确答案】
C
【答案解析】The completed contract method less net income in the periods before construction is completed, but not at the end of the contract, than using the percentage-of-completion method. This is because the completed contract method recognizes revenue and expense only when the contract has been completed.
单选题
Which of the following statements about types of nonrecurring items is
least accurate?
A. Unusual or infrequent items are included in income from continuing
operations.
B. Extraordinary items are unusual and infrequent items that are reported
net of taxes and included in nonrecurring income from continuing
operations.
C. Discontinued operations are reported net of taxes below income from
continuing operations.
【正确答案】
B
【答案解析】Extraordinary items are unusual and infrequent items that are reported separately, net of tax, after net income from continuing operations.
单选题
In comparing two companies, an analytical team discovers Company A
uses zero-coupon bonds for debt financing, while Company B uses par value coupon
debt. Analyst 1 feels that Company A' s operating cash flow should be reduced by
the amount of its interest expense to compare it to Company B. Analyst 2 feels
that Company B' s operating cash flow should be increased by the amount of its
interest expense to compare it to Company A. Analyst 3 feels that no adjustments
should be made. Which analyst is taking appropriate action?
A. Analyst 1.
B. Analyst 1 and Analyst 2.
C. Analyst 3.
【正确答案】
B
【答案解析】Either the operating cash flow for Company A can be adjusted down, or the operating cash flow of Company B can be adjusted up.
单选题
Young Distributors, Inc. issued convertible bonds two years ago, and
those bonds are the only potentially dilutive security Young has issued.
In 2005, Young' s basic earnings per share (EPS) and diluted EPS were identical,
but in 2004 they were different. Which of the following factors could NOT
explain the difference between EPS and Diluted EPS? The:
A. bonds were redeemed by Young Distributors at the beginning of 2005.
B. average market price of Young increased in 2005.
C. bonds were antidilutive in 2005 but not in 2004.
【正确答案】
B
【答案解析】Average market price is not a factor in the calculations for including convertible bonds in basic or diluted EPS. All of the other factors listed could be potential explanations for the difference in basic and diluted EPS.
单选题
Which of the following does NOT represent a cash fl0w relating to
operating activity?
A. Cash received from customers.
B. Interest paid to bondholders.
C. Dividends paid to stockholders.
【正确答案】
C
【答案解析】Dividends paid to stockholders are considered cash flow relating to financing activity. However, U.S. GAAP requires interest paid to bondholders to be considered an operating activity.
单选题
Which of the following transactions would least likely be reported in
the cash flow statement as investing cash flows?
A. Purchase of real estate with cash borrowed from a bank.
B. Sale of held-to-maturity securities for cash.
C. Purchase of plant and equipment used in the manufacturing process with
financing provided by the seller.
【正确答案】
C
【答案解析】The purchase of plant and equipment with financing provided by the seller is a non-cash transaction. Non-cash transactions are disclosed separately in a note or supplementary schedule to the cash flow statement.
单选题
The net income for Miller Bat Company was $ 3 million for the year
ended December 31,2004. Additional information is as
follows: Depreciation on fixed assets $1500000
Gain from cash sales of land 200000 Increase in accounts
payable 300000 Dividends paid on preferred stock
400000 The net cash provided by operating activities in the
statement of cash flows for the year ended December 31,2004 is
:
单选题
The following information is from the balance sheet of Silverstone
Company: Net Income for 5/1/05 to 5/31/05 : $ 8000
{{U}}Balance 5/01/05{{/U}}
{{U}}Account{{/U}}
{{U}}Balance 5/31/05 {{/U}}
$2000
Inventory
$1750
$1200
Prepaid exp.
$1700
$800
Accum.Depr.
$975
$425
Accounts payable
$625
$650
Bonds payable
$550
Using the
indirect method, calculate the cash flow from operations for Silverstone Company
as of 5/31/05 :
A. Increase in cash of $ 8025.
B. Increase in cash of $ 8125.
C. Increase in cash of $ 7725.
【正确答案】
B
【答案解析】Silverstone Company' s cash flow from operations would be calculated as Net Income $ 8000 + Inventory $ 250 Prepaid exp. $ 500 + Depreciation $175 + A/P $ 200 = $ 8125.
Bonds payable is a financing activity and would not be included in the cash flow from operations. The indirect method takes the change in the non-cash accounts and decreases or increases net income to get to the change in cash flow.
单选题
Are the following statements about the par value of a firm's common
stock true or false? Statement 1: Par value is a nominal dollar
value assigned to shares of stock in a corporation' s charter.
Statement 2: The par value of common stock represents the amount the corporation
received when the stock was issued.
Statement 1
Statement 2 ①A. True
True ②B.
False
False ③C. True
False
A. ①
B. ②
C.③
【正确答案】
C
【答案解析】The par value of common stock is the stated or nominal value assigned to the stock. Par value has no relationship to market value. The amount the corporation receives from the issuance of common stock is equal to the par value plus the additional paid-in-capital( proceeds in excess of par).
单选题
As of January 1, a company had 22500 $10 par value common shares
outstanding. On July 1, the company repurchased 5000 shares. The company also
has 11000,10% , $100 par value preferred shares. If the company' s net
income is $ 210000, its diluted earnings per share is closest to :
A. $5.00.
B. $7.50.
C. $10.00.
【正确答案】
A
【答案解析】Since this company has a simple capital structure, basic and diluted EPS are equal. The numerator equals net income-preferred dividends = 210000- ( 11000 shares ×0.10 dividend×100 par) = 210000-110000 = 100000. The weighted average shares outstanding = 22500- (5000 shares repurehased ×0. 50 midyear) =22500-2500 =20000. Then, basic EPS = diluted EPS = 100000/20000 = $ 5 per share.
单选题
Under U.S. GAAP, land owned by the firm is most likely to be
reported on the balance sheet at :
A. fair market value.
B. fair market value minus selling costs.
C. historical cost.
【正确答案】
C
【答案解析】Unless impairment has been recognized, land is reported at historical cost and is not subject to depreciation. Increases in value are not reflected in balance sheet values under U. S. GAAP.
单选题
Which of the following is least likely a required financial statement
disclosure according to the Financial Accounting Standards Board and the
International Accounting Standards Board?
A. A description of the entity including its domicile, legal form, and place
of incorporation.
B. Judgments made in applying accounting policies that may have a
significant effect on the amounts reported in the financial statements.
C. The liquidation values of equipment used in the production of goods and
services for a firm that is expected to continue to operate in the foreseeable
future.
【正确答案】
C
【答案解析】Liquidation values of equipment used in the production of goods or services is not a required disclosure for firms that are expected to continue to operate. The other items must be reported in the financial statements.