8. How much cash (in millions) did UTEP Inc. pay for interest in 2018? A. $84 R. SS. what the comparative balonce sheet shows for C. S120 D. SISO E. $156, 9. The A. Jones Consulting Group reported net income of $2,550,000 for its fiscal year ended December 31, 2018. In addition, during the year, the company experienced a before tax loss on foreign currency translation adjustment of $550,000 and had before tax unrealized gains on investment securities of $110,000. The company's effective tax rate on all items affecting comprehensive income is 35%. What is A. Jones's total comprehensive income (loss)? A S(2,836,000) B. $1.657,500 C. $2,121.000 D. $2,264,000. E, S2,979,000 13 1 hi 10. The balance in retained earnings at the end of the year is determined by retained earnings at the beginning of the year: A. Plus accruals, minus deferrals. B. Plus revenues, minus liabilities. C. Plus net income, minus dividends. D. Plus assets, minus liabilities, E. None of the above. 11. Topgolf Inc. paid $600 million for salaries to employees during 2018. There were $48 million and $72 million in salaries payable at the beginning and end of 2018, respectively. What was Topgolf's salaries expense for 2018? A $480 million B. $576 million C. $600 million D. S624 million. E $720 million 12. Esplin Sporting Goods is preparing its annual report for 2018. How should information about the depreciation method used be disclosed? A. In a separate disclosure note. B. In the summary of significant accounting policies note. C. On the face of the balance sheet. D. None of the above. 6 13. Tacoma Inc. is preparing its annual report for 2018. How should information about the composition of long-term debt be disclosed? A. In the summary of significant accounting policies note. B. In a separate disclosure note. C. On the face of the balance sheet D. None of the above. 14. If the external auditor finds that a company's financial statements have a single nonconformity with US GAAP, the external auditor will issue an) opinion A. Unqualified B. Qualified. C. Adverse, D. Disclaimer E. None of the above. 15. Excerpts from Clayton Company's December 31, 2018 and 2017 financial statements are presented below: Profit margin Asset turnover Inventory turnover Receivables tumover Total assets Total shareholder's equity 2018 2017 0.21 0.26 0.58 0.49 15.0 125 18.8 17.5 1,062,500 1,012,500 600,000 562,500 Clayton's 2018 return on shareholder's equity (rounded): A. 12.2% B. 21.0% C. 21.7%. D. 26.0%. E. 58.0% 16. Confirmatory value is central to the concept of earnings quality" because A. It helps investors predict a company's future earnings. B. It allows investors to verify or change their prior assessments of a company's performance. C. It helps investors predict a company's future cash flows. D. It allows investors to compare the performance of a company over time. E. It allows information to come out in a timely manner. 7 17. The difference between revenue from selling inventory and the cost of that inventory is called: A. Gross profit. B. Income before taxes. C. Operating income. D. Net income. E. None of the above, 18. Using the DuPont formula, return on assets equals: A. Profit margin on sales x Inventory tumover. B. Gross margin on sales * Inventory turnover. c. Gross margin on sales * Asset turnover. D. Profit margin on sales * Asset turnover. E. None of the above. 19. The three sections of the statement of cash flows are: A. Operating, Financing, and Selling. B. Selling, Financing, and Marketing. C. Operating, Marketing, and Investing. D. Selling, Marketing and Investing. E. Investing, Operating, and Financing. 20. The quick ratio is a measure of: A. A company's profitability. B. A company's long-term solvency. C. A company's short-term liquidity D. A company's operational efficiency E. None of the above. 21. Accumulated Other Comprehensive Income is reported: A. On the balance sheet. B. On the income statement. C. On the statement of comprehensive income D. On the statement of cash flows. E. None of the above. 22. A firm's comprehensive income always: A. Is the same as its net income. B. Is greater than its net income. C. Is less than its net income. D. Could be greater than or less than net income. 8 23. Dimel Enterprises purchased a four year fire and extended coverage insurance policy on May 31. 2018, and debited the $12,000 premium to Prepaid Insurance. At its December 31, 2018. year-end, Dimel Enterprises would record which of the following adjusting entries? 12,000 1.750 1,750 A. Insurance expense 1.750 Prepaid insurance 10,250 Insurance payable B. Prepaid insurance Insurance expense C. Insurance expense Prepaid insurance D. Prepaid insurance 10,250 Insurance expense 1,750 1.750 10,250 24. In its first year of operations Paydirt Pete Corporation had income before tax of $750,000. Paydirt Pete Corp. made income tax payments totaling $195,000 during the year and has an income tax rate of 40%. What is the balance in income tax payable at the end of the year? A. $195.000 debit. B. $195,000 credit. C. $300,000 debit. D. $105.000 debit. E. S105,000 credit. 25. Which of the following characteristics is not a component of faithful representation based on the FASB's conceptual framework? A. Historical cost. B. Completeness. C. Neutrality. D. Free from crror. E. All of the above are components of faithful representation. 26. Which of the following has the statutory authority to set accounting standards in the United States? A. CAP. B. IRS C. AICPA D. APB E. SEC. 27. Examples of extemal transactions include all of the following except: A. Paying employee salaries. B. Purchasing equipment C. Expensing supplies used. D. Collecting a receivable. E. Issuing long-term debt. 28. Which of the following accounts has a balance where credits normally exceed debits? A. Supplies expense B. Long-term debt. C. Equipment. D. Prepaid rent E. None of the above. 29. Cash equivalents would not include: A. Equity securities. B. Money market funds. C. U.S. treasury bills. D. Commercial paper. E. All of the above are considered cash equivalents. 30. El Chuco Corporation's income statement includes income from continuing operations and a loss on discontinued operations. Earnings per share information would be provided for: A. Net income only B. Income from continuing operations and net income only. C. Discontinued operations only. D. Income from continuing operations, loss on discontinued operations, and net income. E. None of the above 31. In comparing the direct method with the indirect method of preparing the statement of cash flows: A. Only operating activities are presented differently. B. Only investing activities are presented differently. C. Only financing activities are presented differently. D. All activities are presented differently. 10 32. The FASB's stated preference for reporting operating cash flows is the: A. Indirect method B. Working capital method. C. Direct method. D. All financial resources method. E. None of the above. 33. The Financial Accounting Standards Board (FASB) is primarily funded by: A. Membership fees paid by CPAs. B. Taxpayer funds appropriated by the U.S. Congress. C. Fees assessed against issuers of securities. D. Donations from individuals and corporations E. None of the above. 34. The periodicity assumption that underlies U.S. GAAP presumes: A. Economic events can be identified specifically with an economic entity. B. A business entity will continue to operate indefinitely. C. The life of a company can be divided into artificial time periods to provide timely information. D. The U.S. dollar is used in U.S. financial statements. E. None of the above 35. The trial balance of Lakewood Inc. included the following accounts as of December 31, 2021: Debits Credits Sales revenue 1,800,000 Interest revenue 80,000 Gain on sale of investments 50,000 Cost of goods sold 1,100,000 Selling expense 220,000 Loss on inventory write-down 30,000 Interest expense 40,000 General and administrative expense 200,000 Lakewood Inc. had 100,000 shares of stock outstanding throughout the year. Income tax expense has not yet been accrued. The effective tax rate is 25%. Earnings Per Share for the period equals: A. $2.00 B. $2.55 C. $3.40 D. $19.30 11