2002SpringFinalSession1-1 - David A. Dittman, Financial...

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David A. Dittman, Financial Accounting Question Sheet HA 121 Final Exam Name: ___________________________________ CUID: _______________________ TRUE / FALSE AND MULTIPLE CHOICE QUESTIONS Directions: 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. 1. With respect to a corporation, select the statement that is correct. A) Its organization requires an approved charter which is governed by state law. B) Ownership rights to the corporation are transferable. C) A corporation is a separate legal entity from its owners. D) Stockholders have limited liability. E) All of the above are correct. 2. Jackson Company gathered the following data to prepare its 20B statement of cash flows: N e t i n c o m e … . . . $ 4 0 , 0 0 0 D e p r e c i a t i o n e x p e n s e … . . . 5 , 0 0 0 A c c o u n t s r e c e i v a b l e d e c r e a s e … . . 3 , 0 0 0 W a g e s p a y a b l e i n c r e a s e … . . . 4 , 0 0 0 A m o r t i z a t i o n o f p a t e n t … . 1 , 0 0 0 I n c o m e t a x p a y a b l e d e c r e a s e … 2 , 0 0 0 Based only on the above data, the net cash inflow from operating activities during 20B was A) $43,000. B) $51,000. C) $53,000. D) $45,000. E) None of the above is correct. 3. Preferred stock dividends in arrears must be paid before dividends on common stock can be paid if the preferred stock has a cumulative dividend preference. Page 1
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Question Sheet HA 121 Final Exam Name: ___________________________________ CUID: _______________________ 4. Which of the following entries would be recorded when a company reissues 1,000 shares of treasury stock for $25 per share when they were reacquired at a cost of $22 per share and have a $1 par value? A) Cash 25,000 Treasury Stock 22,000 Paid in capital, treasury stock 3,000 B) Cash 25,000 Treasury Stock 22,000 Gain on sale of stock 3,000 C) Cash 25,000 Common Stock 1,000 Paid in capital, common stock 24,000 D) Cash 25,000 Treasury Stock 22,000 Investment income on treasury stock 3,000 5. Amortization of a premium on a held-to-maturity investment increases interest revenue. 6. The sales revenue reported on the income statement for 20A totaled $96,000, of which one third was on credit. The 20A beginning balance of accounts receivable was zero and the 20A ending balance reported on the balance sheet was $10,000; therefore, the 20A cash inflow from customer sales was $86,000. 7. At the end of 20C, Allen Corporation reported a retained earnings credit balance of $50,000. During 20D, Allen reported the following amounts: Cash dividends declared and paid $15,000, net income of $35,000, and a $5,000 prior period adjustment (debit). The 20D ending balance of total retained earnings was
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This note was uploaded on 11/02/2008 for the course HADM 1121 taught by Professor Dittman during the Fall '07 term at Cornell University (Engineering School).

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2002SpringFinalSession1-1 - David A. Dittman, Financial...

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