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Marino Company has provided the following information: Net sales, $480,000 Net income, $24,000 Average total assets, $200,000 What is Marino's return on assets?


A) 240%
B) 12%
C) 5%
D) 42%

E) None of the above
F) A) and B)

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B

The balance sheet for Glenwood Corporation at December 31, 2016 showed the following subtotals: The balance sheet for Glenwood Corporation at December 31, 2016 showed the following subtotals: Required: Based on the above data, calculate the following amounts: A)Total assets _______ B)Long-term liabilities _______ C)Common stock and Additional paid-in capital _______ D)Total liabilities and stockholders' equity Required: Based on the above data, calculate the following amounts: A)Total assets _______ B)Long-term liabilities _______ C)Common stock and Additional paid-in capital _______ D)Total liabilities and stockholders' equity

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A. $140,000 + $420,000 + $70,000 = $630,000. B. $210,000 - $80,000 = $130,000. C. $420,000 - $120,000 = $300,000. D. $210,000 + $420,000 = $630,000.

Which of the following items is not part of disclosure notes to the financial statements?


A) Descriptions of the significant accounting methods applied in the company's financial statements.
B) Additional detail of income taxes payable reported in the balance sheet.
C) Names of executive officers and the salaries for each officer listed.
D) Commitments under long-term supply agreements to buy inventory and equipment.

E) A) and B)
F) A) and C)

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Financial analysts utilize a company's financial reports to assist them in making earnings forecasts and earnings per share projections.

A) True
B) False

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Which of the following statements is false when a company sells inventory costing $700 for $1,200 cash and operating expenses are $200?


A) Cost of goods sold is $700.
B) Gross profit is $500.
C) Stockholders' equity increases by net income of $300.
D) Net sales increase $500.

E) A) and D)
F) B) and C)

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Corporate governance refers to the procedures designed to ensure that the company is managed in the interest of the board of directors who oversee management.

A) True
B) False

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The Statement of Comprehensive Income includes items in which order?


A) Net income, Other items of net income, Comprehensive income.
B) Comprehensive income, Net income, Other items of Comprehensive income.
C) Net income, Other Fair value items, Comprehensive income.
D) Net income, Other comprehensive income items, Comprehensive income.

E) B) and C)
F) A) and D)

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Which of the following would most likely increase the net profit margin ratio?


A) An increase in the unit selling price.
B) A decrease in the overall sales volume.
C) An increase in operating expenses.
D) An increase in cost of goods solD.An increase in the unit selling price will increase net income by a greater amount proportionately relative to the increase in net sales.

E) B) and C)
F) C) and D)

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Which of the following results in an increase in the return on assets ratio?


A) A decrease in the total asset turnover ratio.
B) An increase in the net profit margin ratio.
C) Purchasing a building by signing a long-term mortgage payable.
D) Using cash to purchase lanD.Return on assets is net income divided by average total assets or net profit margin ratio times total asset turnover ratio.An increase in the net profit margin ratio therefore increases return on assets.

E) B) and C)
F) A) and B)

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Gains and losses on sales of investments are reported on the income statement as a component of income from operations.

A) True
B) False

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The essence of reporting the gains on sales of investments separately on an income statement is that they are do not to primary operations of the reporting company.

A) True
B) False

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Intangible assets are reported on the balance sheet as a current asset.

A) True
B) False

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The fraud triangle conditions necessary for financial statement fraud to occur are the existence of a system of internal control, the ability to invade the system, and rationalization to commit the fraud.

A) True
B) False

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Panmar Inc. is preparing a statement of stockholders' equity for 2016. On January 1, 2016, Panmar started the year with a $200,000 credit balance in its retained earnings account. During 2016, the company earned net income of $140,000. Panmar declared dividends of $80,000 and paid $50,000 of those dividends. Also, the company received cash of $100,000 for additional shares of common stock issued and then paid $30,000 to repurchase shares of common stock. What is the balance in retained earnings on December 31, 2016?


A) $260,000.
B) $290,000.
C) $330,000.
D) $390,000.

E) All of the above
F) C) and D)

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Huron has provided the following year-end balances: Cash, $25,000 Patents, $7,900 Accounts receivable, $9,300 Property, plant, and equipment, $98,700 Prepaid insurance, $3,600 Accumulated depreciation, $10,000 Inventory, $37,000 Retained earnings, 15,500 Trademarks, $12,600 Accounts payable, $8,000 Goodwill, $11,000 How much are Huron's net noncurrent assets?


A) $122,300.
B) $120,200.
C) $123,800.
D) $112,300.

E) A) and B)
F) None of the above

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Which of the following would not be used to calculate income from operations?


A) Gross profit.
B) Selling and administrative expenses.
C) Interest income.
D) Research and development expense.

E) None of the above
F) B) and D)

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Complete the following balance sheet by entering the appropriate amounts in the blanks provided. Complete the following balance sheet by entering the appropriate amounts in the blanks provided.

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A. $40,000. ($90,000 Total Assets (F) - $35,000 Book Value of Building - $15,000 Cash) B. $25,000. ($60,000 Building - $35,000 Book Value) C. $90,000. (Must equal to F.) D. $2,000. ($25,000 Current liabilities - $11,000 Accounts Payable - $12,000 Notes payable) E. $40,000. ($25,000 Common stock + $15,000 Retained earnings) F. $90,000. ($50,000 Total Liabilities + $40,000 Total Stockholders' Equity)

Which one of the following statements is true when a company sells inventory costing $800 for $1,400 cash, and operating expenses are $500?


A) There is no change in current assets.
B) Gross profit increases $100.
C) Stockholders' equity increases $100.
D) Net sales increases $2,200.

E) None of the above
F) A) and C)

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A company has paid cash to repurchase its common stock that was previously issued. Where will this cash flow be reported on the statement of cash flows?


A) Operating activities.
B) Financing activities.
C) Investing activities.
D) Stockholder activities.

E) None of the above
F) B) and C)

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Comparative financial statements are those of a company in one industry presented with another company in the same industry.

A) True
B) False

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