1.

On January 4, Year 1, Barber Company purchased 7,000 shares of Convell Company for $79,500 plus a broker's fee of $1,400. Convell Company has a total of 35,000 shares of common stock outstanding and it is presumed the Barber Company will have a significant influence over Convell. During each of the next two years, Convell declared and paid cash dividends of $0.85 per share, and its net income was $92,000 and $87,000 for Year 1 and Year 2, respectively. What is the book value of Barber's investment in Convell at the end of Year 2?

$80,900.

$104,800.

$69,000.

$116,700.

$115,700.

2.

A company has an investment in 11% bonds with a par value of $108,000 that pay interest on October 1 and April 1. The amount of interest accrued on December 31 (the company's year-end) would be:

$1,980.

$11,880.

$5,940.

$2,970.

$990.

3.

Madison Corporation purchased 40% of Jay Corporation for $140,000 on January 1. On June 20 of the same year, Jay Corporation declared total cash dividends of $35,000. At year-end, Jay Corporation reported net income of $175,000. The balance in Madison Corporation's Long-Term Investment-Jay Corporation account as of December 31 should be:

$196,000.

$224,000.

$140,000.

$259,000.

$84,000.

4.

A company had a profit margin of 10.90% and total asset turnover of 1.88. Its return on total assets was:

12.78%

20.49%

14.69%

9.02%

5.80%

5.

A company had net income of $52,500, net sales of $867,570, and average total assets of $239,000. Its profit margin and total asset turnover were, respectively:

21.97%; 6.05.

6.05%; 21.97.

3.63%; 21.97.

3.63%; 6.05.

6.05%; 3.63.