Self Assessment

Final Test Review

Test Review - Using the amounts shown below from the end of 2020 for Eagle, Inc. (except for retained earnings which is from the beginning of 2020) answer the following questions

Net Sales		78,812
Cost of Goods Sold		51,422
Net Property and Equipment		24,637
Selling, General and Administrative Exp		16,597
Long-Term Debt		14,724
Inventory		11,057
Accounts Payable		7,497
Capital Stock		5,427
Retained Earnings		4,032
Income Tax Expense		3,082
Dividends		2,322
Other Long-Term Liabilities		2,042
Cash		1,929
Interest Payable		46
Depreciation Expense		1,627
Salaries Payable		1,428
Accounts Receivable, net		2,000
Unearned Revenue		1,337
Prepaid Insurance		895
Interest Expense		699
Income Taxes Payable		526
Sales Taxes Payable		396

Question 1

Question 1 options:

What is the total current assets? Don't need dollar signs

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Question 2

Question 2 options:

What is the total current liabilities? Don't need dollar signs

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Question 3

Question 3 options:

What is gross profit? no need for commas or dollar signs

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Question 4

Question 4 options:

What is the gross margin ratio (round to one decimal place and label correctly)

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Question 5

Question 5 options:

What is operating income (before taxes) no need for dollar signs or commas

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Question 6

Question 6 options:

How much is net income for 2020? no commas or dollar signs needed

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Question 7

Question 7 options:

What is ending retained earnings for 2020? no commas or dollar signs

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Question 8

Question 8 options:

What is total equity at the end of 2020? no dollar signs or commas

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Question 9

Question 9 options:

What is the current ratio for 2020? one decimal place

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Question 10

Question 10 options:

What is the quick ratio? one decimal place

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Question 11

Question 11 options:

What is the net profit margin? one decimal place and proper label

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Question 12

Question 12 options:

What is return on assets if total assets for 2020 is the same as for 2019? one decimal place and proper label

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Question 13

Question 13 options:

What is the accounts receivable turnover if 2020 accounts receivable was the same as at the end of 2019? one decimal place and label

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Question 14

Question 14 options:

What is the inventory turnover if 2019 inventory is the same as 2020?

one decimal and label

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Question 15

From the ratios calculated what can you say about the financial health of this company?

Question 15 options:

Question 16

Using the information given, what would happen to the current ratio of this company if they bought inventory on credit?

Question 16 options:

	Go up
	Go down
	Stay the same

Question 17

What would happen to the inventory turnover if all the information on the income statement stayed the same but inventory on the balance sheet increased?

Question 17 options:

	It would go up
	It would go down
	It would stay the same

Question 18

If the income tax expense was cut in half from what was given above, the calculation of return on assets/investment would:

Question 18 options:

	Go up
	Go down
	Stay the same

Question 19

Dividends go in what section on the cash flow statement?

Question 19 options:

	Operating
	Investing
	Financing
	Equity

Question 20

Receiving cash upon the sale of equipment (not inventory) would be a positive cash amount in what section of the cash flow statement?

Question 20 options:

	Operating
	Investing
	Financing
	Equity

Question 21

On the accounting equation when an asset is used up and is reduced, there is also a change in what other part of the equation?

Question 21 options:

	Expenses
	Capital Stock
	Current Liabilities
	Revenues

Question 22

If the auditor of a publicly traded company does not find any material misstatements and is of the opinion that the financial statements fairly state the financial condition of the company, their opinion is described as:

Question 22 options:

	Qualified
	Unqualified
	Justified
	Special

Question 23

An internal control system is built like a pyramid with control environment at its base, what is the considered the top of the pyramid?

Question 23 options:

	Control procedures
	Monitoring
	Risk Assessment
	Generally Accepted Accounting Principles

Question 24

ABC Corp sells an item of inventory to a customer for cash. The inventory cost $500 and the customer paid $750 for it. What happened on the accounting equation?

Question 24 options:

	Current assets increased by $750
	Current assets increased by $250
	Revenue increased by $250
	Retained earnings decreased by $750

Question 25

If Eagle has employees that have worked but have not yet been paid for their work, recording this in the accounting equation would do what?

Question 25 options:

	Increase current assets
	Increase current liabilities
	Decrease revenues
	Decrease total liabilities

Question 26

If Eagle has employees that have worked but have not yet been paid for their work, recording this would do what to the quick ratio if everything else stayed the same?

Question 26 options:

	Make it go up
	Make it go down
	It would stay the same