33/ Kreighton Manufacturing purchased on credit 40,000 worth of production materials from a British company when the exchange rate was $1.87 per British pound. At the year-end balance sheet date the exchange rate increased to $2.66. If the liability is still unpaid at that time, Kreighton must record a:

Multiple Choice

loss of $31,600.

gain of $106,400.

gain of $31,600.

loss of $106,400.

neither a gain nor loss.

34/ On February 15, Jewel Company buys 7,100 shares of Marcelo Corp. common stock at $28.54 per share plus a brokerage fee of $400. The stock is classified as available-for-sale securities. This is the companys first and only investment in available-for-sale securities. On March 15, Marcelo Corp. declares a dividend of $1.16 per share payable to stockholders of record on April 15. Jewel Company received the dividend on April 15 and ultimately sells half of the Marcelo Corp. stock on November 17 of the current year for $29.31 per share less a brokerage fee of $250. The journal entry to record the dividend on April 15 is:

Multiple Choice

Debit Cash $7,511; credit Interest Revenue $7,511.

Debit Cash $8,236; credit Gain on Sale of Investments $8,236.

Debit Cash $8,236; credit Interest Revenue $8,236.

Debit Cash $8,236; credit Dividend Revenue $8,236.

Debit Cash $7,511; credit Dividend Revenue $7,511.

35/ Cloverton Corporation had net income of $34,560, net sales of $1,200,000, and average total assets of $540,000. Its return on total assets is:

Multiple Choice

222.2%

6.4%

2.9%

1.5%

15.6%

36/ A company had net income of $48,500, net sales of $653,730, and average total assets of $231,000. Its profit margin and total asset turnover were, respectively:

Multiple Choice

2.83%; 21.00.

21.00%; 7.42.

7.42%; 21.00.

7.42%; 2.83.

2.83%; 7.42.