Question
1. An asset turnover ratio of 1.87 for a company indicates that: a.the company has $1.87 of long-term debt for each dollar of operating revenue
1. An asset turnover ratio of 1.87 for a company indicates that:
a.the company has $1.87 of long-term debt for each dollar of operating revenue earned.
b.the company is generating $1.87 of sales revenue for each dollar of long-term operating assets invested.
c.the company is generating $1.87 of net income for each dollar of retained earnings.
d.the company has $1.87 of current assets for each dollar of fixed assets invested.
2. The following information is available for Amanda Co. for the current year.
Common shares outstanding | 150,000 |
Preferred stock dividend declared and paid | $90,000 |
Net income | $300,000 |
Calculate the company's earnings per share.
a.$2.60
b.$1.40
c.$1.10
d.$2.00
3. On July 1, George Co. issued $3,000,000 of 10-year, 8% bonds at par. Interest on the bonds is payable semiannually on December 31 and June 30. As a result of this transaction, net assets of the company:
a.is not effected.
b.decrease by $120,000.
c.increase by $3,000,000.
d.decrease by $240,000.
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