Question 22 pts

1. The net income for the year ended December 31, 2018, for Tax Consultants INC. was $1,320,000. Additional information is as follows:

Capital expenditures $1,600,000 Depreciation on plant assets 600,000 Cash dividends paid on common stock 240,000 Increase in noncurrent deferred tax liability 60,000 Amortization of patents 28,000

Based on the information given above, what should be the net cash provided by operating activities in the statement of cash flows for the year ended December 31, 2018?

a	$1,768,000.

b	$1,888,000.

c	$1,948,000.

d	$2,008,000.

2. Information concerning the debt of Cole Company is as follows:

Short-term borrowings:

Balance at December 31, 2017 $525,000 Proceeds from borrowings in 2018 325,000 Payments made in 2018 (450,000) Balance at December 31, 2018 $400,000

Current portion of long-term debt:

Balance at December 31, 2017 $1,625,000 Transfers from caption "Long-Term Debt" 500,000 Payments made in 2018 (1,225,000) Balance at December 31, 2018 $ 900,000

Long-term debt:

Balance at December 31, 2017 $9,000,000 Proceeds from borrowings in 2018 2,250,000 Transfers to caption "Current Portion of Long-Term Debt" (500,000) Payments made in 2018 (1,500,000) Balance at December 31, 2018 $9,250,000

In preparing a statement of cash flows for the year ended December 31, 2018, for Cole Company, cash flows from financing activities would reflect

Outflow

a	$2,000,000

a	$2,250,000

c	$2,575,000

d	$3,175,000

3. Worthington Company purchased a machine on January 1, 2015, for $7,200,000. At the date of acquisition, the machine had an estimated useful life of six years with no salvage. The machine is being depreciated on a straight-line basis. On January 1, 2018, Worthington determined, as a result of additional information, that the machine had an estimated useful life of eight years from the date of acquisition with no salvage. An accounting change was made to reflect this additional information. What amount of depreciation expense should be reported in Worthingtons income statement for the year ended December 31, 2018?

a	$1,200,000

b

$900,000

c

$720,000

d

$450,000

4. On January 7, 2016, Yoder Corporation acquired machinery at a cost of $4,200,000. Yoder adopted the sum-of-the-years-digits method of depreciation for this machine and had been recording depreciation over an estimated life of five years, with no residual value. At the beginning of 2018, a decision was made to change to the straight-line method of depreciation for this machine. Assuming a 30% tax rate, the cumulative effect of this accounting change, net of tax, is

a

$0

b

$560,000

c

$588,000

d

$840,000

5. Information from Collins Companys balance sheet is as follows:

Current assets: Cash $ 12,000,000 Short-term investments 20,000,000 Accounts receivable 50,000,000 Inventories 66,000,000 Prepaid expenses 2,000,000 Total current assets $150,000,000 Current liabilities: Notes payable $ 11,000,000 Accounts payable 18,000,000 Accrued expenses 13,000,000 Income taxes payable 3,000,000 Current portion of long-term debt 5,000,000 Total current liabilities $ 50,000,000

What is the acid-test (quick) ratio?

a

1.24 to 1

b

1.64 to 1

c

1.68 to 1

d

3.00 to 1

6. Fargo, Inc. disclosed the following information as of and for the year ended December 31, 2018:

Net cash sales 600,000 Net credit sales 1,080,000 Inventory at beginning 100,000 Inventory at end 150,000 Net income 30,000 Accounts receivable at beginning of year 110,000 Accounts receivable at end of year 130,000

Fargos accounts receivable turnover is

a

8.3 to 1

b

9.0 to 1

c

12.9 to 1

d

14.0 to 1