66.

Which of the following is one logical rationale for making a short-term investment?

• Retirement savings

• The market is on an upward trend

• Ability to accept the unpredictability of the stock market

• Need for liquidity

67.

If a company purchases a 5-year bond with a face value of $75,000 for $74,000, resulting in a discount of $1,000, accounting rules require which of the following happen?

• The discount is expensed in the year of purchase

• The discount is amortized over the life of the bond

• The bond is adjusted to fair value annually

• The bond investment is recorded at $75,000

68.

CBD Company's income statement reported $111,000 of pre-tax net income. A review of the accounts revealed two errors. Sales revenue of $27,000 was not accrued and supplies expense of $9,300 was recorded as $3,900. What income should be recorded?

• $78,600

• $143,400

• $89,400

• $132,600

69.

The income tax reported on a company's income statement is $83,000. The company's taxable income is $87,000. Which of the following must the company record?

• Income tax expense of $4,000

• Deferred income tax liability of $87,000

• Income tax payable of $83,000

• Deferred income tax asset of $4,000

70.

What are the three important dates related to cash dividends, in order of occurrence?

• Date of record, date of payment, date of declaration

• Date of declaration, date of record, date of payment

• Date of record, date of declaration, date of payment

• Date of declaration, date of payment, date of record

61.

Sharon, the accountant for ALM Company, incorrectly debited a maintenance expense for a cost that should have been capitalized. What is this error known as?

• Counterbalancing error

• Error of principle

• Error of transposition

• Error of omission

62.

At the beginning of the year, Ferber Company had retained earnings of $340,000. For the current year the company had revenues of $1.8 million, net income of $522,000 and paid dividends of $300,000. What are the retained earnings at the end of the year?

• $1,162,000

• $562,000

• $1,840,000

• $2,440,000

63.

Using the account balances shown in the image below, calculate total Stockholders' Equity.

• $553,000

• $639,000

• $425,000

• $596,000

64.

Which of the following is an example of a permanent difference between accounting and tax income?

• Differences in depreciation from using alternate methods

• Bad debt expense deduction

• Installment sale revenue

• Municipal bond interest

65.

Sheldon Company issues a 10-year $100,000 bond that pays coupon interest of $10,000 annually when the market interest rate is 9%. The factors for an interest rate of 9% and a 10-year term are shown below. What is the issue price of the bond?

• $100,000

• $42,200

• $106,380

• $64,180