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Practice Test Ch 17

Practice Test Ch 17 - Practice Test Chapter 17 Acctg 202 1...

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Practice Test Chapter 17 Acctg 202 1. A company's sales in 2004 were $250,000 and in 2005 were $287,500. Using 2004 as the base year, the sales trend percent for 2005 is: A 87%. B 100%. C 115%. D 15%. E 13%. 2. A company had a market price of $37.50 per share, earnings per share of $1.25, and dividends per share of $0.40. Its price-earnings ratio equals: A 3.1. B 30.0. C 93.8. D 32.0. E 3.3. 3. The ability to meet short-term obligations and to efficiently generate revenues is called: A Liquidity and efficiency. B Solvency. C Profitability. D Market prospects. E Creditworthiness. 4. The ability to generate future revenues and meet long-term obligations is referred to as: A Liquidity and efficiency. B Solvency. C Profitability. D Market prospects. E Creditworthiness. 5. A company reports the following comparative income statements: 2005 2004 Net sales ............................................................................ $736,000 $840,000 Cost of goods sold ............................................................. 518,880 571,200 Gross profit ....................................................................... $217,120 $268,800 Operating expenses ............................................................ 104,800 130,000 Net income ........................................................................ $112,320 $138,800 What are the costs of goods sold in common-size percents for 2004 and 2005, respectively?
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