week+2+quiz - Noel Nieves - Week 2 Quiz Use the following...

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Week 2 Quiz Use the following information to answer questions 1–5: Sam’s Office Supplies Balance Sheet December 31, 2008 Cash $ 65,000 Accounts Payable $ 70,000 Prepaid Insurance 30,000 Salaries Payable 10,000 Accounts Receivable 50,000 Mortgage Payable 90,000 Inventory 70,000 Total Liabilities $160,000 Land held for investment 75,000 Land 90,000 Building $100,000 Common Stock $120,000 Less Accumulated Retained Earnings 250,000 Depreciation (20,000) 80,000 Total stockholders’ equity $370,000 Trademark 70,000 Total Liabilities and Total Assets $530,000 Stockholders’ Equity $530,000 1. The total dollar amount of assets to be classified as current assets is a. $290,000. b. $215,000. c. $180,000. d. $145,000. 2. The total dollar amount of assets to be classified as property, plant, and equipment is a. $320,000. b. $170,000. c. $245,000. d. $190,000. 3. The total dollar amount of assets to be classified as investments is a. $0. b. $150,000. c. $75,000. d. $180,000. 4. The total amount of working capital is a. $135,000. b. $295,000. c. $75,000. d. $60,000. 5. The current ratio is a. 1.94 : 1. b. 1.57 : 1. c. 3.14 : 1. d. 2.69 : 1.
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6. At December 31, 2008 Lily Company had retained earnings of $1,092,000. During 2008 they issued stock for $49,000, and paid dividends of $17,000. Net income for 2008 was $201,000. The retained earnings balance at the beginning of 2008 was: a. $1,276,000 b. $ 908,000 c. $957,000 d. $1,227,000 7. The relationship between current assets and current liabilities is important in evaluating a company's a. profitability. b. liquidity. c. market value. d. solvency. 8. Which of the following is a measure of liquidity? a. Working capital b. Profit margin c. Earnings per share d. Debt to equity ratio 9. Current assets divided by current liabilities is known as the a. working capital. b. current ratio. c. profit margin. d. capital structure. 10. The most important information needed to determine if companies can pay their current obligations is the a. net income for this year. b. projected net income for next year. c. relationship between current assets and current liabilities. d. relationship between short-term and long-term liabilities. 11. A short-term creditor is primarily interested in the __________ of the borrower. a. liquidity b. profitability c. consistency d. solvency 12. The current ratio is a. current assets plus current liabilities. b. current assets minus current liabilities. c. current assets divided by current liabilities. d. current assets times current liabilities. 13.
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week+2+quiz - Noel Nieves - Week 2 Quiz Use the following...

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