36 Accounting for something retrospectively means changing any prior period financial statements that are presented B accounting for something only after a prospectus has been printed and distributed accounting for something in a manner the company's auditors may not approve accounting for something in the present period and in the future D 37 We voluntarily change from the LIFO method to the FIFO method of accounting for inventory We account for this prospectively We account for this retrospectively As management, we can choose whether to account for this either prospectively or retrospectively B 38 Our company bought a machine on January 1 of year 1. The machine's cost was $74.000, Its useful life was estimated to be 10 years, and the salvage value was estimated to be $8,000. After three years of using straight line depreciation, the accumulated depreciation was $19,800 At the beginning of year 4, we dedded the remaining useful life was only 5 years, and there would be no salvage value. An entry made in year 4 would indude a debit to depredation expense of $23.100. a debit to retained earrings a credit to retained earnings D a debit to depredation expense of $10,840. E None of the other answers is correct B 39 Our company has preferred stock outstanding, but this year our board of directors did not dedare any dividend. When calculating earnings per share, under what circumstances would we subtract the normal preferred dividend in the numerator? under no circumstances, because there is no preferred dividend If there was a net loss for the period if the preferred stock is non cumulative D of the preferred stock is cumulative B 40 Which of the following could NOT appear in the stockholders' section of a corporation's balance sheet? A Paid in capital - excess of par, preferred B Paldin capital -- lapse of stock options Paldin capital - restricted stock D Paldin capital - share repurchase E Each of the four items in Athrough D COULD appear on a corporation's Balance sheet 41 The "discount on bond investment" account could appear on which financial statement? A Income statement B balance sheet statement of changes in shareholders' equity D tax return The present value of the face amount of the bonds plus the present value of the annuity of the interest payments, using the market rate of interest yield) equals A the interest expense on each interest payment, using the straight line method B the premium or the discount on the bonds the issue price of the bonds D the amount the issuing company must pay to retire the bonds at maturity 43 Where on the statement of cash flows do we show "proceeds from sale of land? A cash flows from operating activities cash flows from investing activities C cash flows from financing activites D nowhere. It does not go on the statement of cash flows B