Which of the following is one gauge of the company's ability to meet its short term obligations?

a. gross margin

b. asset turnover

c. profit margin

d. working capital

e. none of the above

2. Ellen Fetter invested 5k in a saving account that paid 5% interest compounded annually. she kept the account for 3 years. At the end of the 3 years, Ellen will have approximately?

a. 6,103

b.5,444

c.5,414

d.5,799

E.none of the above

3. Grayson is saving for a used car. He needs 14,000. How much must he invest at 3% annual interest rate to have 14,000 in two years? Round to the nearest dollar.

a. 12,983

b.12,417

c.13,720

d.13,196

e.none of the above

4.Which of the following is added to net income to calculate flow?

a. depreciation

b. increase in accounts recievable

c.increase in inventory

d.decrease in accounts payable

e.none of the above

5. if a company pays out more than the income tax incrrued as shown in the income tax liablity decrease, the effect on cash is a

a. decrease

b. increase

c. no effect

d. none of the above

6. Elsei Jackson is saving for a down payment on a condo. She needs 20,000. How much must she invest in a savings account that pays 5% annually to have the 20,000 in eight years? Round to the nearest dollar.

a. 13,206

b.12,983

c.13,616

d.13,537

e. none of the above

7. The quality that allows quantitative assessment of the similarities and differences among enterprises is known as

a. comparability

b. consistency

c. reliability

d. relevance

e. none of the above

8.Which of the following increases cash?

a. increase in inventory

b. increase in accounts recieveable

c. increase in accounts payable

d. none of the above

9.Which of the following ratios is not useful for comparison purposes?

a. return on assets

b. price earning ratio

c. return on equity

d. earnings per share

e. none of the above

10. Which of the following is a snapshot of the financial position of a company?

a. balance sheet

b. income statement

c. statement of retained earnings

d. cash flow statement

e. none of the above

11. The concept that an item is not large enough to influence the users of a financial statement is

a. cost effectiveness

b. materiality

c. reliability

d. relevance

e. none of the above

12. Which of the following increases cash?

a. issuance of long term debt

b. acquistion of property plant and equipment

c. payment of dividends

d. decrease in short term debt

e. none of the above

13. profit margin and asset turnover can be combined to create

a. return on assets

b. return on equity

c. earnings per share

d. price earnings ratio

e. none of the above

14. which ratio is Wall streets favorite?

a. inventory turnover

b. recieveable turnover

c. current

d. price earnings

e. none of the above

15. information that can make a different to the decision at hand is considered to be

a. reliable

b. comparable

c. relevant

d. understandable

e. none of the above

16. Blackson inc signed a three year lease for the building that Blackson occupies and paid the first six months in advance. The account that should be debited is

a. prepaid expenses

b. cash

c. building

d. accounts payable

e. none of the above

17. Ginger Ellison invested 10,000 in a bank account at Offshot Bank. The account pays 3% interest compounded annually. How much will Ginger have in 5 years? Round to the nearest dollar

a. 11,593

b.11,108

c.10,123

d.12,619

e. none of the above

18. Right hand entries increase

a. asset accounts

b. owners equity accounts

c. liabilities

d. both b and c

e. none of the above

19. Ellis industries is a large, multinational company located in the US. Ellis financial statements are in US dollars. This GAAP is known as

a. monetary concept

b. economic entity

c. conservatism

d. matching

e. none of the above

20. Which of the following ratios is the coverage ratio?

a. return on assets

b. return on equity

c. earnings per share

d. times interest earned

e. none of the above