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Retained Earnings is cash flow froma company's primary business activitiesthat a company has invested backinto its operations.

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TrueFalse

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My company's Days Payables Outstanding (DPO) is rising. An explanation for this could be that my company is taking advantage of extended credit terms offered to us by our suppliers.

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TrueFalse

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A company makes a mortgage payment that has both a principal payment component and an interest expense component. This mortgage payment will impact both the operating activities section of the cash flow statement and the financing activities section of the cash flow statement.

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TrueFalse

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A company purchased $10,000 worth of equipment one year ago. Depreciation Expense for the past year on the equipment was $2,000. The book value of this particular piece of equipment is equal to $8,000 after its first year of use. Select one:

TrueFalse

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"Goodwill" is an asset account that develops in the course of acquisitions and mergers. It is an intangible asset that represents the amount over fair market value that an acquiring company pays for the net assets of another company. It almost always is a negative figure(or a contra asset) and therefore it serve to increase Return on Assets (ROA).

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TrueFalse

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If I see the word "consolidated" in the title of a company's financial statements I know that this company has subsidiaries.

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TrueFalse

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The Fixed Charge Coverage Ratio (FCC) can never be greater than Times Interest Earned (TIE).

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TrueFalse

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My company uses LIFO to account for its inventory cost flow and it operates in an industry susceptible to typical inflationary pressures. At the end of the year, my inventory is valued on the balance sheet at $1,500,000 and my company's LIFO Reserve is $200,000. If my company used FIFO instead of LIFO, the value of its inventory at the end of the year would have been approximately $1,700,000.

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TrueFalse

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Compared to a firm with a capital lease, operating leases help the lessee firm (the firm that is leasing the item) earn a higher return on assets. Select one:

TrueFalse

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The granting of stock options to employees as a form of compensation generally does not require the recognition of compensation expense by the company granting the stock options.

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TrueFalse

Question26 Not yet answered Points out of 3.00 Remove flag Question text When a company's pension fund assets fall short of the projected benefit obligation (PBO), the pension fund is considered to be "under-funded" and company must now recognize a liability for this under-funded status on its balance sheet. Select one: True False Question30 Not yet answered Points out of 3.00 Remove flag Question text Most of the factors used to determine specific expense accruals for defined benefit pension plans are based upon actuarial assumptions and present values. Select one: True False