Question 10

If a company had retained earnings of $40,000 at the beginning of the year, net earnings of $50,000, and a yearending retained earnings of $90,000, it paid its owners a dividend at some point during the year.

True

False

Question 9

Gross Margins can exceed 100%.

True

False

Question 8

A netprofit will result during a time period when...

liabilities exceed assets.

drawings exceed investments.

expenses exceed revenues.

revenues exceed expenses.

Question 7

A net loss will result during a time period when:

liabilities exceed assets.

drawings exceed investments.

expenses exceed revenues.

revenues exceed expenses.

Question 6

What are the total current liabilities of the Postal Service at December 31, 2018?

242,000

22,000

15,000

28,000

Question 5

Use the following items taken from the financial statements of the Postal Service for the year ending December 31, 2018 to answer the following 2 questions

Accounts payable ....................................................$10,000

Accounts receivable...................................................11,000

Accumulated depreciation - equipment .................28,000

Advertising expense ...................................................21,000

Cash ............................................................................14,000

Owner's capital .........................................................105,000

Owner's drawings.......................................................14,000

Depreciation expense ...............................................12,000

Insurance expense ......................................................3,000

Note payable, due 6/30/19 ..........................................5,000

Prepaid insurance (6 - month policy) ..........................6,000

Rent expense ...............................................................17,000

Salaries and wages expense ......................................32,000

Service revenue ........................................................125,000

Supplies (Inventory) .......................................................4,000

Supplies expense ..........................................................6,000

Equipment(Long-term) ...........................................210,000

What are total current assets of the Postal Service at December 31, 2018?

$14,000

$35,000

$18,000

$105,000

Question 4

What is ABC's Gross Profit?

$6,000,000

$4,000,000

$4,200,000

$10,000,000

Question 3

What is ABC's Earnings Per Share for 2018?

$0.80

$0.70

$0.85

$1.15

Question 2

What is ABC's Net Income?

$6,000,000

$1,800,000

$1,105,000

$4,200,000

Question 1

ABC Corporation - Partial Income Statement -FY 2018

2018 Revenue ...................... $ 10,000,000

Cost of Goods Sold ..................... 4,000,000

Selling General and Admin ........ 1,500,000

Research and Development ...... 1,200,000

Depreciation ................................ 1,500,000

Operating Expenses ................ ????

Interest Income ........................... 150,000

Interest Expense ......................... 250,000

Pre-Tax Income ...................... 1,700,000

Tax ................................................. 595,000

EPS - Basic ...............................$??

Weighted avg. Shares................1,300,000

Use the above information to answer the following four questions:

1. What is ABC's Operating Profit for 2018?

$6,000,000

$1,800,000

$1,700,000

$1,105,000