Assuming no other information is provided, all of the following are examples of extraordinary items EXCEPT: (Points : 2) Write-down or write-off of receivables or inventory. expropriation of property by a foreign government. Significant agricultural loss due to a rare hail storm. Uninsured losses from an earthquake. Question 2.2. How should a gain from the sale of used equipment for cash be reported in a statement of cash flows using the indirect method? (Points : 2) In operating activities as a deduction from income. In investment activities as a cash outflow. In investment activities as a reduction of the cash inflow from the sale. In operating activities as an addition to income. Question 3.3. When a fixed asset is sold, the gain/loss on disposal is the difference between: (Points : 2) selling price and accumulated depreciation. selling price and book value. fair value and selling price. fair value and accumulated depreciation. Question 4.4. On January 1, Year 1, Company X purchases equipment for $240,000 with an expected useful life of 12 years. The straight-line method is applied. During Year 4, entity officials decide to switch to the double-declining balance method. No other change is made. What amount of depreciation expense is recognized by the entity for Year 4? (Points : 2) $27,778. $30,000. $23,148. $40,000. Question 5.5. Gil Corp. has current assets of $90,000 and current liabilities of $180,000. Which of the following transactions would improve Gil's current ratio? (Points : 2) Collecting $10,000 of short-term accounts receivable. Purchasing $50,000 of merchandise inventory with a short-term account payable. Refinancing a $30,000 long-term mortgage with a short-term note. Paying $20,000 of short-term accounts payable. Question 6.6. Which of the following should be disclosed in the summary of significant accounting policies? Composition of inventories / Maturity dates of long-term debt (Points : 2) No No Yes Yes No Yes Yes No Question 7.7. The principal advantage of the completed contract method over the percentage-of-completion method is it: (Points : 2) provides more predictable earnings. is suitable for a wider range of long-term contracts. provides more conservative earnings. provides a better reflection of the earnings process. Question 8.8. If a corporation that uses the cost method of recording treasury stock transactions sells some of its treasury stock at a price that exceeds its cost, this excess should be (Points : 2) Credited to additional paid-in capital. Credited to retained earnings. Treated as a reduction in the carrying amount of remaining treasury stock. Reported as a gain in the income statement. Question 9.9. An entity reports net income before income taxes this year of $300,000. The enacted tax rate is 30%. The entity has reported a $40,000 gain on an installment sale that will not be taxed for two years. The entity has also reported $50,000 in interest revenue from State of Maine bonds. On the entitys income statement, what is reported as current income tax expense? (Points : 2) $75,000. $90,000. $63,000. $78,000. Question 10.10. If $10,000 is invested in a mutual fund that returns 12 percent per year, compounded monthly, after 30 years the investment will be worth: n i FV of $1 360 1% 35.9496 60 6% 32.9877 30 12% 29.9599 (Points : 2) $299,599. $359,496. $46,000. $11,200.