16. If a companys average collection period is 90 days, what is the accounts receivable turnover? (Points : 4)

4 4.5 5 40

Question 17.17. A company had $500,000 of current assets and $250,000 of current liabilities before borrowing $50,000 from the bank (using a 6 month note payable). What effect did the note payable have on the companys current ratio? (Points : 4)

There is an increase in current ratio The effect cannot be calculated There is a decrease in current ratio There is no effect on the current ratio

Question 18.18. A company had net income of $150,000, paid out $15,000 in dividends, and $40,000 in deferred dividends. What is the payout ratio? (Points : 4)

5% 10% 26.7% 36.7%

Question 19.19. What does the acid test ratio measure? (Points : 4)

Short term solvency Short term liquidity Long term solvency Long term liquidity

Question 20.20. A company has current assets of $2,800,000; fixed assets of $5,600,000; current liabilities of $1,000,000; and notes payable of $500,000. What is the companys working capital? (Points : 4)

$1,800,000 $2,800,000 $4,600,000 $6,900,000

Question 21.21. What does the accounts receivable turnover measure? (Points : 4)

Quality of the receivables Profitability of the receivables Liquidity of the receivables Solvency of the receivables

Question 22.22. A company had assets of $500,000 on January 1; assets of $650,000 on December 31; and net income for the year of $86,250. What is the companys return on assets? (Points : 4)

13.3% 15% 17% 17.3%

Question 23.23. Which would be a responsibility of a management accountant? (Points : 4)

Prepare reports for external users Prepare financial statements Prepare detailed cost budgets Calculated earnings per share

Question 24.24. Which is considered an internal user? (Points : 4)

Loan officer Customer Department supervisor Stockholder

Question 25.25. When must internal reports be communicated? (Points : 4)

On an as-needed basis On a weekly basis On a monthly basis On a quarterly basis

Question 26.26. A manager that is analyzing actual results with planned results is performing which management function? (Points : 4)

Organizing Directing Planning Controlling

Question 27.27. Which is a purpose of financial accounting? (Points : 4)

Determining divisional costs Determining unit costs Reporting unit costs Reporting total costs

Question 28.28. What do managerial accounting reports communicate? (Points : 4)

Highly condensed information concerning the entire business Information about subunits of the business Information about the business as a whole Audited financial statements

Question 29.29. Which of the following is classified as direct labor? (Points : 4)

Salesmans salary Product inspectors salary Plant managers salary Factory custodians wages

Question 30.30. What costs are included in product costs? (Points : 4)

Direct materials, direct labor, and manufacturing overhead Direct materials and direct labor Direct materials, direct labor, and indirect labor only Selling and administrative expenses

Question 31.31. What is another name for product costs? (Points : 4)

Direct labor costs Capitalized costs Inventoriable costs Associated costs

Question 32.32. Which cost is classified as manufacturing overhead? (Points : 4)

Manufacturing supervisor salaries Machinist labor Cleaning supplies for equipment Depreciation

Question 33.33. Which of the following is classified as direct labor? (Points : 4)

Assembly workers wages Factory repairmans wages Supervisor salary Plant manager salary

Question 34.34. Which of the following is an example of a period cost? (Points : 4)

Product materials Office supplies Direct labor Indirect labor

Question 35.35. If a product cost cannot be classified as direct material or direct labor, what category is it assigned to? (Points : 4)

Overhead cost Administrative cost Period cost Management cost