* Felix Company uses the indirect method to prepare the statement of cash flows. Refer to the following income statement: $252,000 Felix Company Income Statement Year Ended December 31, 2015 Sales Revenue $245,000 Interest Revenue 2,000 Gain on Sale of Plant Assets 5,000 Total revenues and gains Cost of Goods Sold 118,000 Salary Expense 43,000 Depreciation Expense 13,000 Other Operating Expenses 25,000 Interest Expense 1,500 Income Tax Expense 5,500 Total Expenses Net Income (loss) 206,000 $46,000 Additional information provided by the company includes the following: 1) Current assets, other than cash, increased by $24,000 2) Current liabilities decreased by $1,000 How much is the net cash provided by operating activities? A) $21,000 B) $29,000 C) $39,000 D) $34,000 Unrealized holding gainis or losses on trading investments are reported in the section of the income statement A) Fixed Assets B) Minority Interest C) Current Assets D) Other Revenues and Expenses Which of the following sections of the statement of cash flows include activities that affect Net Income on the income statement? (Assume the indirect method is used.) A) the non-cash investing and financing section B) the operating section C) the financing section D) the investing section OMIT 5. A corporation has 2,000 shares, 10% preferred stock of $50 par, and 6,000 shares of common stock outstanding. The net income for the year is $250,000. Calculate earnings per share. A) $40 B) $42 C) $125 D) $50 On June 1, 2015, Smith Services issued $30,000 of 7 50% bonds that mature in five years. They were sold at a premium, for a total of $31,250. The bonds pay semiannual interest payments on June 30 and December 31 of each year. On December 31, 2015, how much is the total amount paid to bondholders? A) $2,343.75 B) $1,125.00 $1,171.88 D) $2,250.00 Zebra Inc. cost of goods sold for the year is $1,900,000 and average merchandise inventory for the year is $129,000. Calculate the inventory turnover ratio of the company. A) 33.8 times B) 14.73 times 65.5 times D) 16.78 times * 10). Which of the following is true of a Discount on Bonds Payable account? A) It is added to the Bonds Payable balance and shown with long-term liabilities on the balance sheet. B) It is subtracted from the Bonds Payable balance and shown with long-term liabilities on the balance sheet. C) It is added to the Bonds Payable balance and shown with owner's equity on the balance sheet. D) It is subtracted from the Bonds Payable balance and shown with the current liabilities on the balance sheet. Glitter Services owns 30% of voting stock of Grey Investments. During the year 2015, Grey Investments earned profits of $250,000. Under the equity method, which of the following journal entries will Glitter Services record? A) Cash 75,000 Long-term Investments-Grey Investments 75,000 MIT B) Long-term Investments-Grey Investments 75,000 Revenue from Investments 75,000 Long-term Investments-Grey Investments 250,000 Cash 250,000 DY Cash 75,000 Dividend Revenue 75,000 OMIT 11) Prior period adjustments: A) affect balance sheet accounts only, and must be included on single-step income statements. B) are shown on the statement of retained earnings as corrections to the beginning balance. C) always increase the beginning balance of retained eamings. D) must be included as a separate line item on a multi-step income statement
