QUESTION 1

1. A Statement of Cash Flows is generated to show:

   	a.	How profits were generated during the period.
   	b.	The revenues the company has earned during the period.
   	c.	The inflow and outflow of cash during the period.
   	d.	The expenses the company incurred during the period.

1 points

QUESTION 2

1. Smithson Corp. had the following selected balance sheet changes for the past year:

   Assets Increase (Decrease)

   Cash $47,000

   Accounts Receivable $10,000

   Inventory $15,000

   Prepaid Expenses ($7,000)

   Accumulated Depreciation $11,000

   Liabilities Increase (Decrease)

   Accounts Payable $20,000

   Wages Payable ($12,000)

   Taxes Payable $9,000

   The company's net income during the year was $35,000. What is the net cash provided by operating activities during the year on the statement of cash flows using the indirect method?

   	a.	$25,000
   	b.	$45,000
   	c.	$92,000
   	d.	$10,000

4 points

QUESTION 3

1. The beginning and ending balances of long-term debt are $64,000, and $35,200, respectively, and cash payments for long-term debt during the year were $34,100. How much new long-term debt was issued during the year?

   	a.	New long-term debt issued during the year was $62,000
   	b.	New long-term debt issued during the year was $28,800
   	c.	New long-term debt issued during the year was $5,300
   	d.	New long-term debt issued during the year was $1,100

2 points

QUESTION 4

1. A company sold equipment with a book value of $10,000 at a gain of $2,500. How much can be reported in the investing activities section of the statement of cash flows as cash received from sale of equipment?

   	a.	The cash received from sale of equipment is $2,500
   	b.	The cash received from sale of equipment is $10,000
   	c.	The cash received from sale of equipment is $7,500
   	d.	The cash received from sale of equipment is $12,500

1 points

QUESTION 5

1. Page sells books. Based on the information below calculate cost of goods available for sale:

   Purchases $105,000

   Operating expenses 53,000

   Beginning merchandise inventory 14,000

   Ending merchandise inventory 11,000

   Sales revenue 170,000

   	a.	$108,000
   	b.	$116,000
   	c.	$105,000
   	d.	$119,000

2 points

QUESTION 6

1. Using the following information calculate the cost of goods sold:

   Utilities for the store 9,500

   Sales commissions 10,000

   Sales revenue 164,000

   Purchases of merchandise 85,000

   January 1 inventory 27,000

   Rent of store 13,500

   December 31 inventory 23,000

   	a.	$112,000
   	b.	$85,000
   	c.	$89,000
   	d.	$108,000

3 points

QUESTION 7

1. Based on the information below what is the cost of direct materials used:

   Beginning of year End of year

   Raw materials inventory 200 180

   Work in Process inventory 320 410

   Finished goods inventory 250 200

   Sales revenue $4,000

   Purchases of direct materials $400

   Direct labor $450

   Manufacturing overhead $620

   Operating expenses $650

   	a.	$600
   	b.	$400
   	c.	$380
   	d.	$420

3 points

QUESTION 8

1. Based on the information below what is the cost of good manufactured and completed:

   Beginning of year End of year

   Raw materials inventory 200 180

   Work in Process inventory 320 410

   Finished goods inventory 250 200

   Sales revenue $4,000

   Purchases of direct materials $400

   Direct labor $450

   Manufacturing overhead $620

   Operating expenses $650

   	a.	$1,580
   	b.	$1,490
   	c.	$1,400
   	d.	$1,380

4 points

QUESTION 9

1. OVERallocated manufacturing overhead results when:

   	a.	Production is less than last year.
   	b.	Actual overhead is less than expected.
   	c.	Actual overhead is less than allocated overhead.
   	d.	Estimated overhead is less than actual overhead.

1 points

QUESTION 10

1. Before the year began, ABC manufacturing estimated that manufacturing overhead for the year would be $200,000 and that 25,000 direct labor hours would be worked.

   Actual results for the year included the following:

   Actual manufacturing costs $182,000

   Actual direct labor hours 20,000

   If the company allocated manufacturing overhead based on direct labor hours, the manufacturing overhead for the year would have been _________

   	a.	$18,000 Underallocated
   	b.	$22,000 Underallocated
   	c.	$18,000 Overallocated
   	d.	$22,000 Overallocated