Question
Please answer 1. Your firm has the following income statement items: sales of $52,000,000; income tax of $1,880,000; operating expenses of $9,000,000; cost of goods
Please answer
1. Your firm has the following income statement items: sales of $52,000,000; income tax of $1,880,000; operating expenses of $9,000,000; cost of goods sold of $36,000,000; and interest expense of $800,000. Compute the firm's gross profit margin.
a. 13.5%
b. 8.3%
c. 30.8%
d. 69.2%
2. Your firm has the following balance sheet statement items: total current liabilities of $805,000; total assets of $2,655,000; fixed and other assets of $1,770,000; and long-term debt of $200,000. What is the amount of the firm's net working capital?
a. $25,000
b. $325,000
c. $770,000
d. $80,000
3. In terms of organizational costs, which of the following sequences is generally correct, moving from lowest to highest cost?
a. General partnership, sole proprietorship, limited partnership, corporation
b. Corporation, limited partnership, general partnership, sole proprietorship
c. Sole proprietorship, general partnership, limited partnership, corporation
d. Sole proprietorship, general partnership, corporation, limited partnership
4. You bought a painting 10 years ago as an investment. You originally paid $85,000 for it. If you sold it for $484,050, what was your annual return on investment?
a. 47%
b. 4.7%
c. 19%
d. 12.8%
5. Patriot Corporation purchased manufacturing equipment with an expected useful life of five years. The purchase of the machinery would be shown as
a. an expense on the balance sheet.
b. an expense on the income statement.
c. an asset on the balance sheet.
d. both an expense and an asset.
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