Financial Statement Analysis (FSA) Practice Problems Solutions
Property, plant, and
Liabilities and stockholders equity
On May 1, 1999, Vantage Insurance Company sold a one-year insurance policy to a
customer for $3,000 cash. What adjusting journal entry should Vantage record on
December 31, 1999:
A double-entry accounting system requires that each transaction or event be recorded:
a. in two different types of accounts (e.g., one asset account and one
liability account, one asset account and one revenue ac
Time Value of Money (TVM) Practice Problems
Find the present value (rounded to the nearest dollar) of:
Compute the future value (rounded to the nearest dollar) of the following investments:
$10,209 invested to earn interest a
Total variable costs increase as the volume of activity decreases.
Total variable costs change in direct proportion to changes in the volume of activity.
Thus, as the volume of activ
Costs associated with two alternatives, code-named Q and R, being
considered by Corniel Corporation are listed below:
These are generally more difficult that what is on the exam
ACCY 113 Practice Midterm #2
One component of pension expense is expected return on plan assets. Plan assets include
a. contributions made by the employer and contributions
FireOut, Inc. manufactures steel cylinders and nozzles for two models of fire extinguishers:
(1) a home fire extinguisher and (2) a commercial fire extinguisher. The home 1 model is a
high-volume (54,000 units), half-gallon cylinder that holds 2 1/2 pound
Cost Behaviors (CB) Practice Problems
A department of Gamma Company incurred the following costs for the month of
5,000 units produced
Variable costs .
Mixed costs .
Total costs .
L) A maior benefit of effective budgeting is that
A) it provides benchmarks to evaluate subsequent performance
B) it aids managers in communicating objectives to employees
C) it compels managers to think ahead
D) all of the above
2) Potential problems
Financial Reporting and Analysis
Chapter 4 Solutions
Structure of the Balance Sheet and Statement of Cash Flows
E4-1. Balance sheet classification
Block Corporation makes three products that use the current constraint,
which is a particular type of machine. Data concerning those products appear
A net loss results from having more liabilities than revenues.
This statement is false. A net loss results when expenses exceed revenues.
The nature of an asset is best de
A negative net cash flow from operating activities:
a. indicates the company is selling its assets for more than it cost to
purchase them which is a good sign for cash flows
b. indicates the company is paying mor
(TCO A) In a classified balance sheet, assets are usually classified as:
current assets; long-term
assets; property, plant,
and equipment; and
current assets; long-term
plant, and equipmen
Practice Question 26
Correct! Restricted retained earnings = $3,000. Therefore, $10,000 - $3,000 = $7,000 is
available for dividends.
Turquoise and Topaz Sisters had retained earnings of $10,000 on the balance sheet but disclosed
in the footnotes that $2,
Property taxes are an example of a cost that would be considered to be:
Organization-sustaining activities are carried out regardless of which customers are served,
which products are produ
Pioneer Corporation had these transactions during 2011.
(a) Issued $50,000 par value common stock for cash.
(b) Purchased a machine for $30,000, giving a long-term note in
(c) Issued $200,000 par value common stock upon conversion of
1. The three major objectives of budgeting are
(1) to establish specific goals for future op erations, (2) to direct and coordinate plans
to achieve the goals, and (3) to periodically
compare actual results with the goals.
The purpose of a flexible budget is to:
update the static planning budget to reflect the actual level of activity of the period.
permit managers to reduce the number of unfavorable variances that are reported.
reduce the amount of conflict between depart
Excerpts from Stepney Corporation's most recent balance sheet (in thousands
of dollars) appear below:
A company should use process costing, rather than job order costing, if:
the product goes through several steps of production.
production is only partially completed during the accounting period.
the product is composed of mass-produced homogeneous units.
MANAGERIAL ACCOUNTING X122
1. For a lamp manufacturing company, the cost of the insurance on its vehicles that deliver lamps to customers is
best described as a:
A. prime cost.
B. manufacturing overhead cost.
C. period cost.
D. differential (incr
In an income statement segmented by product line, a fixed expense that cannot be allocated
among product lines on a cause-and-effect basis should be:
allocated to the product lines on the basis of sales dollars.
classified as a common fixed expense and n
Your answer is correct.
Dividends are declared out of retained earnings.
Your answer is correct.
A corporation can issue more shares than it is authorized in its charter, if the board of directors
approves of an increase i
Nutall Corporation is considering dropping product N28X. Data from the
company's accounting system appear below:
Which of the following is not a benefit of budgeting?
It uncovers potential bottlenecks.
It reduces the need for tracking actual cost activity.
It formalizes a manager's planning efforts.
It sets benchmarks for evaluation performance.
A continuous (or per
Fundamentals of Hypothesis Testing: One-Sample Tests
CHAPTER 9: FUNDAMENTALS OF HYPOTHESIS
TESTING: ONE-SAMPLE TESTS
1. Which of the following would be an appropriate null hypothesis?
a) The mean of a population is equal to 55.
b) The mean of a sample
Which of the following should NOT be included as part of manufacturing overhead at a company
that makes office furniture?
Manufacturing equipment depreciation.
Sheet steel in a file cabinet made by the company.
Taxes on a factory building.
Idle time for
With regard to the CVP graph, which of the following statements is not correct?
The CVP graph assumes that selling prices do not change.
The CVP graph assumes that volume is the only factor affecting total cost.
The CVP graph assumes that