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KellyV2012
KellyV2012, Bachelor's Degree
Category: Multiple Problems
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Experience:  BS in Business Administration: Options in Accounting & Finance
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1. Casey Company reported net income of $35,000; depreciation

Resolved Question:

1. Casey Company reported net income of $35,000; depreciation expenses of $20,000; an increase in
accounts payable of $2,000; and an increase in current notes receivable of $3,000. Net cash flows from
operating activities under the indirect method is
A. $55,000.
B. $56,000.
C. $50,000.
D. $54,000.
2. Rick Company's net sales decreased from $90,000 in year 1 to $45,000 in year 2, and its cost of goods
sold decreased from $30,000 in year 1 to $20,000 in year 2. Vertical analysis based on sales would show
which decreases in cost of goods sold for the two periods (rounded to the nearest tenth of a percent)?
A. 33.3% and 44.4%
B. 44.4% and 33.3%
C. 300% and 225%
D. 225% and 300%
3. Which section of the income statement does not report net of income taxes or net of income tax savings?
A. Extraordinary items section
B. Cumulative effect of changes in accounting principles section
C. Continuing operations section
D. Discontinued operations section
4. Birch issued 200 shares of $12 par common stock in exchange for a piece of equipment with a current
market value of $3,000. Which of the following is not part of the journal entry for this transaction?
A. Crediting common stock for $2,400
B. Debiting equipment for $3,000
C. Crediting paid-in capital in excess of par common for $600
D. Crediting common stock for $3,000
5. The Isaiah Corporation Stockholders' Equity section includes the following information:
Preferred Stock $22,000
Paid-in Capital in Excess of Par—Preferred 2,980
Total par value of the preferred and common stock is
Common Stock 48,000
Paid-in Capital in Excess of Par—Common 3,400
Retained Earnings 7,350
A. $76,380.
B. $83,730.
C. $77,350.
D. $70,000.
6. Which activities are computed differently using the two methods of formatting a statement of cash
flows?
A. Investing activities
B. Both operating activities and investing activities
C. Financing activities
D. Operating activities
7. Accounts receivable amounted to $215,000 at the beginning of the year and $245,000 at the end of the
year. Income reported on the income statement for the year was $300,000. The cash flow from operating
activities on the cash flow statement using the indirect method is
A. $315,000.
B. $300,000.
C. $330,000.
D. $270,000.
8. What is the rate of return on common stockholders' equity if sales are $100,000, net income is $22,700,
and average common stockholders' equity is $86,000?
A. 26.4%
B. 86.0%
C. The rate of return can't be determined from the information given.
D. 22.7%
9. Patty's Baker has cost of goods sold for the years 2011, 2010, and 2009, respectively, of $28,600,
$26,900, and $25,600. If 2009 is the base year, the trend percentage for 2011 is
A. 111.72%.
B. 11.72%.
C. 5.08%.
D. 105.08%.
10. If you own 500 shares (2% of a corporation's stock) and the corporation issues 15,000 new shares,
how many of the new shares can you purchase under preemptive right?
A. 800
B. 500
C. 300
D. 0
11. Birch issued 200 shares of $12 par common stock in exchange for a piece of equipment with a current
market value of $3,000. Which of the following is not part of the journal entry for this transaction?
A. Debiting Equipment for $3,000
B. Crediting Common Stock for $2,400
C. Crediting Common Stock for $3,000
D. Crediting Paid-in Capital in Excess of Par—Common for $600
12. Cost of goods sold for the year was $850,000. Inventory was $60,000 at the beginning of the year and
$90,000 at the end of the year. There were no changes in the amount in accounts payable for the year.
Cash payment for merchandise to be reported under the direct method is
A. $940,000.
B. $880,000.
C. $910,000.
D. $850,000.
13. What is the rate of return on equity if net income is $22,700; preferred dividends are $3,000; sales are
$100,000; and average common stockholders' equity is $86,000?
A. 22.7%
B. 86.0%
C. 22.9%
D. 26.4%
14. Operating cash flows affect
A. current assets and current liabilities.
B. long-term liability accounts.
C. equity accounts.
D. long-term asset accounts.
15. Net sales at Kelly's Bakery increased from $40,000 to $60,000, and its cost of goods sold increased
from $20,000 to $40,000. Vertical analysis based on net sales would show which percentages for cost of
goods sold (rounded to the nearest %)?
A. 40% and 20%
B. 50% and 67%
C. 67% and 40%
D. 10% and 30%
16. Casey Company has a $2,400 credit balance in Paid-In Capital— Treasury Stock. It sells 500 shares of
treasury stock that the company reacquired at $21/share, for $18/share. After the transaction, what will the
balance be in the Paid-In Capital in Excess of Par— Treasury account?
A. $900 credit
B. $900 debit
C. $1,500 debit
End of exam
D. $3,900 credit
17. Tammy Company has a beginning accounts receivable balance of $65,000 and an ending accounts
receivable balance of $60,000. Net credit sales are $250,000. Tammy's accounts receivable turnover rate is
A. 2.000.
B. 4.167.
C. 4.000.
Submitted: 4 years ago.
Category: Multiple Problems
Expert:  KellyV2012 replied 4 years ago.

Hi,

 

Please download the answers below.

 

https://www.box.com/s/12bea75e5ade78a1c16b

 

I hope this help.

 

Thanks,

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