David A. Dittman, Financial Accounting
Question Sheet HA121 Final Examination
FINAL EXAMINATION – Practice Exam
TRUE/FALSE AND MULTIPLE-CHOICE QUESTIONS
Answer Question 1 through 60 on the attached answer sheet.
Each True/False Question is worth 1 point.
Each Multiple Choice Question is worth 2 points
The present value of $1,000 to be received in six years discounted at 10% is less
than the present value of $1,000 to be received in six years discounted at 8%.
A callable bond grants the option to the bondholder of electing to turn the bond in
for early retirement.
A bond liability usually should be reclassified as a current liability when the
maturity date of a bond issue is within one year of the current balance sheet date,
or within the operating cycle (whichever is longer).
In 2001, The Walt Disney Co. had total liabilities of $20,645 million and total
assets of $43,699 million.
In 2000, they had total liabilities of $20,918 million
and total assets of $45,027 million.
Calculate their debt to equity ratio for 2001
and 2000 respectively.
A) 1.12 and 1.15
B) .90 and .87
C) .47 and .46
D) .52 and .54
On July 1, 20B, WildWorld, Inc., sold (issued) 300, $1,000, ten-year, 7% bonds at
101. The bonds were dated July 1, 20B, and semi-annual interest will be paid each
December 31 and June 30. WildWorld uses straight-line amortization. The bond
liability that would be reported on the balance sheet at December 31, 20B, is
E) None of the above is correct.