Please help with this test!

Question 1

1. Upon the date of declaration of a dividend, the corporation has incurred a liability for the dividend .

   True

   False

3 points

Question 2

1. A corporation generally distributes its entire net income to its stockholders.

   True

   False

3 points

Question 3

1. Cash dividends reduce the stockholders' equity in the corporation.

   True

   False

3 points

Question 4

1. When an appropriation of retained earnings is made, total retained earnings decreased.

   True

   False

3 points

Question 5

1. When a dividend is paid in cash, it is known as a

   		liquidating dividend
   		dividend payable
   		cash dividend
   		property dividend

5 points

Question 6

1. If the interest rate on bonds is higher than the current market rate, they will sell at

   		a discount
   		a premium
   		face value
   		maturity value

5 points

Question 7

1. Bondholders have which of the following relationships with a corporation?

   		They are creditors.
   		They are owners
   		They become members of the board.
   		They are silent managers.

6 points

Question 8

1. Bond Interest Payable is reported as a(n)

   		current liability on the income statement.
   		current liability on the balance sheet.
   		adjunct-liability on the balance sheet.
   		contra-liability on the income statement.

5 points

Question 9

1. While bonds and notes are both formal written promises to pay an amount of money at a specified date, notes generally tend to be for much larger amount and for a longer period of time.

   True

   False

5 points

Question 10

1. If the stated interest rate on bonds is less than the current market rate, the bonds will sell at a discount.

   True

   False

5 points

Question 11

1. Bonds payable less the discount on bonds payable is called the carrying value of the bonds.

   True

   False

3 points

Question 12

1. To determine whether a bond will sell at price equal to, greater than, or less than face value, compare the stated and market interest rates.

   True

   False

3 points

Question 13

1. An example of a cash outflow from financing activities is

   		cash dividends paid
   		interest paid on notes payale
   		payment for additional inventory
   		buying debt and equity securities.

5 points

Question 14

1. Under the direct and indirect methods of reporting the statement of cash flows, only

   		the operating activities section is different.
   		the financing activities section is different.
   		the investing activities section is different.
   		the operating and financing activities sections are different.

5 points

Question 15

1. Those transactions dealing primarily with selling a product or providing a service related to the revenues and expenses reported on the income statement are called

   		investing activities
   		operating activities
   		financing activities
   		planning activities

6 points

Question 16

1. A statement of cash flows is prepared from the

   		balance sheet from the beginning and end of the period.
   		general journal.
   		accounts receivable ledger
   		accounts payable ledger.

5 points

Question 17

1. Which of the following adjustments would NOT be made to net income when computing cash from operating activities?

   		add an increase in Accrued Interest Payable
   		deduct the purchase of store equipment
   		add the decrease in Merchandise Inventory
   		add the reduction in Accounts Receivable

5 points

Question 18

1. Achieving profitability will automatically assure sufficient amounts of cash

   True

   False

5 points

Question 19

1. The current ratio and the quick or acid-test ratio may be too high for the overall good of the business.

   True

   False

5 points

Question 20

1. From the standpoint of the individual stockholder, one of the most important measures of profitability of the firm is the earnings per share.

   True

   False

5 points

Question 21

1. Asset turnover ratio measures how effectively a companay uses assets to generate sales.

   True

   False

5 points

Question 22

1. An expression of the amount of each item in a statement as a percentage of some designated total for a comparative purposes is called

   		vertical analysis
   		return on total assets
   		earnings per share
   		horizontal analysis

5 points

Question 23

1. Dividing total current assets by total current liabilities is the calculation for the

   		current ratio
   		return on investment
   		quick or acid-test ratio
   		ratio of liabilities to owner's equity.

5 points

Question 24

1. The net income of a company is $175,000. The average book value of the company's assets is $1,300,000. the return on total assets would be

   		20%
   		7.43%
   		600%
   		13.46%

5 points

Question 25

1. The net inome for a company was $315,000 last year and is $270,000 this year. The percent of increase or decrease was

   		16.7%
   		14.3%
   		26.4%
   		86.0%

Thanks!

Question 1 1. Upon the date of declaration of a dividend, the corporation has incurred a liability for the dividend . True False 3 points Question 2 1. A corporation generally distributes its entire net income to its stockholders. True False 3 points Question 3 1. Cash dividends reduce the stockholders' equity in the corporation. True False 3 points Question 4 1. When an appropriation of retained earnings is made, total retained earnings decreased. True False 3 points Question 5 1. When a dividend is paid in cash, it is known as a liquidating dividend dividend payable cash dividend property dividend 5 points Question 6 1. If the interest rate on bonds is higher than the current market rate, they will sell at a discount a premium face value maturity value 5 points Question 7 1. Bondholders have which of the following relationships with a corporation? They are creditors. They are owners They become members of the board. They are silent managers. 6 points Question 8 1. Bond Interest Payable is reported as a(n) current liability on the income statement. current liability on the balance sheet. adjunct-liability on the balance sheet. contra-liability on the income statement. 5 points Question 9 1. While bonds and notes are both formal written promises to pay an amount of money at a specified date, notes generally tend to be for much larger amount and for a longer period of time. True False 5 points Question 10 1. If the stated interest rate on bonds is less than the current market rate, the bonds will sell at a discount. True False 5 points Question 11 1. Bonds payable less the discount on bonds payable is called the carrying value of the bonds. True False 3 points Question 12 1. To determine whether a bond will sell at price equal to, greater than, or less than face value, compare the stated and market interest rates. True False 3 points Question 13 1. An example of a cash outflow from financing activities is cash dividends paid interest paid on notes payale payment for additional inventory buying debt and equity securities. 5 points Question 14 1. Under the direct and indirect methods of reporting the statement of cash flows, only the operating activities section is different. the financing activities section is different. the investing activities section is different. the operating and financing activities sections are different. 5 points Question 15 1. Those transactions dealing primarily with selling a product or providing a service related to the revenues and expenses reported on the income statement are called investing activities operating activities financing activities planning activities 6 points Question 16 1. A statement of cash flows is prepared from the balance sheet from the beginning and end of the period. general journal. accounts receivable ledger accounts payable ledger. 5 points Question 17 1. Which of the following adjustments would NOT be made to net income when computing cash from operating activities? add an increase in Accrued Interest Payable deduct the purchase of store equipment add the decrease in Merchandise Inventory add the reduction in Accounts Receivable 5 points Question 18 1. Achieving profitability will automatically assure sufficient amounts of cash True False 5 points Question 19 1. The current ratio and the quick or acid-test ratio may be too high for the overall good of the business. True False 5 points Question 20 1. From the standpoint of the individual stockholder, one of the most important measures of profitability of the firm is the earnings per share. True False 5 points Question 21 1. Asset turnover ratio measures how effectively a companay uses assets to generate sales. True False 5 points Question 22 1. An expression of the amount of each item in a statement as a percentage of some designated total for a comparative purposes is called vertical analysis return on total assets earnings per share horizontal analysis 5 points Question 23 1. Dividing total current assets by total current liabilities is the calculation for the current ratio return on investment quick or acid-test ratio ratio of liabilities to owner's equity. 5 points Question 24 1. The net income of a company is $175,000. The average book value of the company's assets is $1,300,000. the return on total assets would be 20% 7.43% 600% 13.46% 5 points Question 25 1. The net inome for a company was $315,000 last year and is $270,000 this year. The percent of increase or decrease was 16.7% 14.3% 26.4% 86.0%