Acct 101

1) The horizontal analysis of the balance sheet is based on the comparative balance sheet.

True

False

5) The financial statements of Carrier Office Furniture Company include the followingitems:

2019 2018

Cash $49,500 $45,000

Short-term Investments 29,000 10,000

Net Accounts Receivable 97,000 103,000

Merchandise Inventory 162,000 150,000

Total Assets 534,000 550,000

Total Current Liabilities 271,000 293,000

Long-term Note Payable 57,000 52,000

What is working capital for2019?

A.$66,500

B.$37,500

C.$95,500

D.$206,000

7) A horizontal analysis would be used if an analyst wants to see how the assets of a company have changed from one year to the next.

True

False

8) Commons, Inc. provides the following information for2018:

Net income $36,000

Market price per share of common stock $20/share

Dividends paid $0.80/share

Common stock outstanding at Jan.1, 2018 110,000 shares

Common stock outstanding at Dec.31, 2018 155,000 shares

The company has no preferred stock outstanding. Calculate the dividend yield for common stock.(Round answer to two decimalplaces.)

A.4%

B.4.17

C.1.35%

D.2.65%

9) Which of the following is not a part of acorporation's annualreport?

A.employees' pay rates

B.MD&A

C.notes to financial statements

D.report of independent registered public accounting firm

11) Pearlman, Inc. provides the following information for2019:

Net income

$285,000

Market price per share of common stock

$30.00/share

Dividends paid

$1.00/share

Common stock outstanding at Jan.1, 2019

120,000 shares

Common stock outstanding at Dec.31, 2019

130,000 shares

The company has no preferred stock outstanding. Calculate the dividend payout ratio.(Round any intermediate calculations and final answer to two decimalplaces.)

A.23.36%

B.42.02%

C.30.00%

D.43.86%

12) Milton, Inc. provides the following income statement for2019:

Net Sales

$240,000

Cost of Goods Sold

110,000

Gross Profit

$130,000

OperatingExpenses:

Selling Expenses

45,000

Administrative Expenses

12,000

Total Operating Expenses

57,000

Operating Income

$73,000

Other Income and(Expenses):

Loss on Sale of Capital Assets

(26,000)

Interest Expense

(1,000)

Total Other Income and(Expenses)

(27,000)

Income Before Income Taxes

$46,000

Income Tax Expense

5,700

Net Income

$40,300

Calculate thetimes-interest-earned ratio.(Round answer to two decimalplaces.)

A.40.30 times

B.47.00 times

C.73.00 times

D.46.00 times

15) For the vertical analysis of the balancesheet, the base amount is also the total of liabilities andstockholders' equity.

True

False

16) In a vertical analysis of the balancesheet, the base amount is total liabilities.

True

False

17) The debt ratio is the ratio of total debt divided by total equity.

True

False

18) To accurately determine the financial performance of acompany, it is necessary to compare its performance from year toyear, with a competingcompany, and with the same industry as a whole.

True

False

19) The current ratio is calculated as total current assets divided by total current liabilities.

True

False

20) Elephant, Inc.'s cost of goods sold for the year is $ 2 comma 600 comma 000

$2,600,000, and the average merchandise inventory for the year is $ 137 comma 000

$137,000. Calculate the inventory turnover ratio of the company.(Round your answer to two decimalplaces.)

A.5.27 times

B.9.47 times

C.9.49 times

D.18.98 times