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Interest revenue earned on held-to-maturity investments is reported on the income statement in the ________ section. A.other revenues and expenses B.current assets C.operating income D.minority

Interest revenue earned on held-to-maturity investments is reported on the income statement in the ________ section.

  • A.other revenues and expenses
  • B.current assets
  • C.operating income
  • D.minority interest

Unrealized gains or losses on available-for-sale investments occur when a company adjusts the investment to ________.

  • A.fair value but has not yet disposed of the asset
  • B.fair value when an asset is disposed
  • C.average value but has not yet disposed of the asset
  • D.average value when an asset is disposed

Realized gains or losses on available-for-sale investments represent the difference between the ________.

  • A.historical cost and the average market value of the investment
  • B.historical cost and the current market value of the investment
  • C.cash received at time of disposition and the fair value of the investment
  • D.cash received at time of disposition and the cost of the investment

The rate of return on total assets measures a company's ________.

  • A.ability to meet its short-term obligations
  • B.ability to repay its long-term debt
  • C.success in using assets to earn income
  • D.success in earning high returns on investments in stocks and bonds of other companies

Which of the following is the correct formula for calculating rate of return on total assets?

  • A.(Net income + Interest expense) / Average total assets
  • B.(Net income - Interest expense) / Average total asset
  • C.(Net income - Interest expense) / Total assets
  • D.Total equity / Total assets

A business's cash receipts and cash payments for a specific period are reported on a(n) ________.

  • A.income statement
  • B.balance sheet
  • C.statement of cash flows
  • D.cash reconciliation statement

Which of the following sections of the statement of cash flows is presented differently between the direct method and indirect method?

  • A.investing activities
  • B.financing activities
  • C.operating activities
  • D.non-cash activities

Which of the following statements accurately describes the statement of cash flows?

  • A.It shows the relative proportion of debt and assets.
  • B.It is the link between the accrual-based income statement and the cash reported on the balance sheet.
  • C.It indicates when long-term debt will mature.
  • D.It is the link between net income and earnings per share.

Which of the following is the typical order of the sections on a statement of cash flows?

  • A.operating, financing, investing
  • B.financing, investing, operating
  • C.investing, operating, financing
  • D.operating, investing, financing

Allen Services purchased 20 delivery vehicles by issuing a 20-year installment note payable for $720,000. On the statement of cash flows, this transaction would be shown in the ________.

  • A.investing activities section
  • B.non-cash investing and financing activities section
  • C.operating activities section
  • D.financing activities section

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