ACCT 221 Assignment Quiz -

ACCT221 Assignment Quiz

 

1 The statement of cash flows should help investors and creditors assess each of the following except the
1. reasons for the difference between net income and net cash provided by operating activities. 2.  cash investing and financing transactions during the period. 3. entity's ability to generate future income. 4.  entity's ability to pay dividends

 

2  Cash receipts from interest and dividends are classified as

1. either financing or investing activities.  2. financing activities.  3. investing activities.  4. operating activities.

 

3  Significant noncash transactions would not include

1. exchange of plant assets.  2. conversion of bonds into common stock. 3.  treasury stock acquisition. 4. asset acquisition through bond issuance

 

4  Jean’s Vegetable Market had the following transactions during 2014:

1. Issued $50,000 of par value common stock for cash.

2. Repaid a 6 year note payable in the amount of $22,000.

3. Acquired land by issuing common stock of par value $50,000.

4. Declared and paid a cash dividend of $7,000.

5. Sold a long-term investment (cost $3,000) for cash of $6,000.

6. Acquired an investment in IBM stock for cash of $10,000.

What is the net cash provided by financing activities?

$21,000 $67,000 $28,000 $0

   

 

5 Kanet Company issued common stock for proceeds of $386,000 during 2014. The company paid dividends of $80,000 and issued a long-term note payable for $95,000 in exchange for equipment during the year. The company also purchased treasury stock that had a cost of $15,000. The financing section of the statement of cash flows will report net cash inflows of

$291,000. $481,000. $306,000. $371,000.

   

 

6 Wilson Company reported net income of $105,000 for the year ended December 31, 2014. During the year, inventories decreased by $15,000, accounts payable decreased by $20,000, depreciation expense was $18,000 and a gain on disposal of equipment of $9,000 was recorded. Net cash provided by operating activities in 2014 using the indirect method was

$101,000 $120,000 $118,000 $109,000

   

 

7 Which of the following adjustments to convert net income to net cash provided by operating activities is incorrect?

Add to Net Income  Deduct from Net Income

Accounts Receivable decrease increase

Accounts Payable increase decrease

Inventory decrease increase

Prepaid Expenses increase decrease

 

8 During 2014, Harvey Industries reported cash provided by operations of $670,000, cash used in investing of $1,039,000, and cash used in financing of $145,000. In addition, cash spent for fixed assets during the period was $404,000. No dividends were paid. Based on this information, what was Harvey's free cash flow?

$266,000 ($369,000) $1,450,000 ($918,000)

 

9 A stockholder is interested in the ability of a firm to

1. All of these answer choices are correct 2. appreciate in share price 3. survive over a long period 4. pay consistent dividends

 

10 A technique for evaluating financial statements that expresses the relationship among selected items of financial statement data is

1. horizontal analysis 2.  ratio analysis. 3. common size analysis 4. vertical analysis

 

11 Assume the following cost of goods sold data for a company:

2014 $1,704,000

2013 1,400,000

2012 1,200,000

If 2012 is the base year, what is the percentage increase in cost of goods sold from 2012 to 2014?
70.4% 117% 42% 85.7%

 

12 Saira, Inc. has the following income statement (in millions):

SAIRA, INC.

Income Statement

For the Year Ended December 31, 2014

Net Sales $300

Cost of Goods Sold 180

Gross Profit 120

Operating Expenses 45

Net Income $75

Using vertical analysis, what percentage is assigned to Net Income?

1. 25% 2. 40% 3. 625%  4. None of these answer choices are correct

 

13 The current assets of Myers Company are $250,000. The current liabilities are $100,000. The current ratio expressed as a proportion is

2.5 : 1 25 : 1 $250,000 ÷ $100,000 250%

 

14 Nord Company had $375,000 of current assets and $150,000 of current liabilities before borrowing $70,000 from the bank with a 3-month note payable. What effect did the borrowing transaction have on Nord Company's current ratio?

1. The change in the current ratio cannot be determined  2. The ratio decreased 3. The ratio remained unchanged 4. The ratio increased

 

15. Net sales are $8,000,000, beginning total assets are $2,500,000, and the asset turnover is 4.0 times. What is the ending total asset balance?

$2,000,000 $2,500,000 $2,500,000 $1,500,000

 

16 Blitzen Corporation had net income of $200,000 and paid dividends to common stockholders of $50,000 in 2014. The weighted average number of shares outstanding in 2014 was 40,000 shares. Blitzen Corporation's common stock is selling for $35 per share on the New York Stock Exchange. Blitzen Corporation's price-earnings ratio is

1. 5 times 2. 9.3 times 3. 5.6 times 4. 7 times

 

17 The major reporting standard for presenting managerial accounting information is

1. relevance  the current tax law  2. the cost principle  3. generally accepted 4. accounting principles

 

18 What activities and responsibilities are not associated with management's functions?

1. Controlling  2. Planning 3. Directing 4. Accountability

 

19 Which one of the following is not a direct material?

1. Lubricant for a ball-bearing joint for a large crane  2. A tire used for a lawn mower  3. Plastic used in the covered case for a home PC  4. Steel used in the manufacturing of steel-radial tires

 

20 Which one of the following is not considered as material costs?

1. Lumber used to build tables 2. Rivets for the wings of a new commercial jet aircraft 3.Bolts used in manufacturing the compressor of an engine  4. Partially completed motor engines for a motorcycle plant

 

21 For the work of factory employees to be considered as direct labor, the work must be conveniently and
1. periodically associated with raw materials conversion 2. promptly associated with raw materials conversion 3. physically associated with raw materials conversion 4. materially associated with raw materials conversion

 

22 For inventoriable costs to become expenses under the expense recognition principle, all accounts

1. payable must be settled 2. the product to which they attach must be sold 3. the product must be finished and in stock 4. the product must be expensed based on its percentage-of-completion

 

23 Gruffin Manufacturing Company reported the following year-end information:

Beginning work in process inventory $1,420,000

Beginning raw materials inventory 400,000

Ending work in process inventory 1,200,000

Ending raw materials inventory 640,000

Raw materials purchased 1,250,000

Direct labor 1,300,000

Manufacturing overhead 960,000

Gruffin Manufacturing Company's cost of goods manufactured for the year is

1. $4,690,000 2. $2,900,000  3. $3,270,000 4. $3,490,000

 

24 Sandor Manufacturing Inc.'s accounting records reflect the following inventories:

Dec. 31, 2013 Dec. 31, 2014

Raw materials inventory $110,000 $ 90,000

Work in process inventory 156,000 174,000

Finished goods inventory 138,000 150,000

 

During 2014, Sandor purchased $1,440,000 of raw materials, incurred direct labor costs of $300,000, and incurred manufacturing overhead totaling $84,000.

 

 

Assume Sandor Manufacturing’s cost of goods manufactured for 2014 amounted to $1,740,000. How much would it report as cost of goods sold for the year?

1. $1,878,000    2. $1,878,000    3. $1,728,000   4. $1,752,000

 

25 Which of the following would be accounted for using a job order cost system?

1. The refining of petroleum  2. The production of automobiles  3. The construction of a new campus building  4. The production of personal computers

 

26 As of December 31, 2014, Walking Tall Industries had $3,500 of raw materials inventory. At the beginning of 2014, there was $2,000 of materials on hand. During the year, the company purchased $314,500 of materials; however, it paid for only $302,500. How much inventory was requisitioned for use on jobs during 2014?

1. $316,000   2. $304,000  3. $313,000  4. $301,000

 

27 Lincoln Manufacturing has the following labor costs:

Factory—Gross wages $450,000

Factory—Net wages 420,000

Employer Payroll Taxes Payable 40,000

The entry to record the cost of factory labor and the associated payroll tax expense will include a debit to Factory Labor for

1. $420,000  2. $450,000 3. $490,000  4. $460,000

 

28 Alpine Inc. uses job order costing for its brand new line of sewing machines. The cost incurred for production during 2014 totaled $20,000 of materials, $8,000 of direct labor costs, and $8,000 of manufacturing overhead applied. The company ships all goods as soon as they are completed which results in no finished goods inventory on hand at the end of any year. Beginning work in process totaled $9,000, and the ending balance is $15,000. During the year, the company completed 20 machines. How much is the cost per machine?

1. $1,880  2. $1,760  3. $1,500 4. $1,320

 

29 Viking Company manufactures customized desks. The following pertains to Job No. 935:

Direct materials used $14,300

Direct labor hours worked 500

Direct labor rate per hour $14.00

Machine hours used 350

Applied factory overhead rate per machine hour $25.00

 

 

What is the total manufacturing cost for Job No. 935?

$26,200  $30,050  $31,700  $35,550

 

30 The predetermined overhead rate is based on the relationship between

1. estimated monthly costs and actual monthly activity  2. estimated annual costs and actual activity 3. estimated annual costs and expected annual activity 4. actual monthly costs and actual annual activity

 

31 During 2012, Alvarez Manufacturing expected Job No. 26 to cost $336,000 of overhead, $400,000 of materials, and $240,000 in labor. Alvarez applied overhead based on direct labor cost. Actual production required an overhead cost of $840,000, $825,000 in materials used, and $330,000 in labor. All of the goods were completed. What amount was transferred to Finished Goods?
$1,617,000 $976,000 $1,206,000 $1,500,000

 

32  During 2014, Terra Manufacturing expected Job No. 59 to cost $700,000 of overhead, $1,000,000 of materials, and $500,000 in labor. Terra applied overhead based on direct labor cost. Actual production required an overhead cost of $580,000, $1,200,000 in materials used, and $450,000 in labor. All of the goods were completed. How much is the amount of over- or underapplied overhead?

1. $50,000 underapplied 2. $50,000 overapplied 3. $120,000 underapplied 4. $120,000 overapplied

 

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