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ACC503 MBA - 05-09 Final exam Multiple Choice - 3 points each 1. When a corporation has both common stock and preferred stock outstanding: A)...

Acc fianal exam questions

ACC503 MBA – 05-09 Final exam Multiple Choice – 3 points each 1. When a corporation has both common stock and preferred stock outstanding: A) dividends on preferred stock are paid only if the company has current earnings. B) dividends on preferred stock must be paid before dividends on common stock can be paid. C) preferred stockholders receive the same dividend per share as common stockholders. D) dividends on preferred stock are paid only if dividends are to be paid on the common stock. 2. For the fiscal year ended March 31, 2004, a company reported earnings per share of $3.25 and cash dividends per share of $0.50. During fiscal 2005, the company had a 3 for 2 stock split. In the annual report for the fiscal year ended March 31, 2005, earnings per share and cash dividends for fiscal 2004 would be reported, respectively, as: A) $3.25 and $0.50 B) $4.85 and $0.75 C) $2.17 and $0.33 D) $1.09 and $0.17 3. If the selling price per unit were to drop $2, from $100 to $98, the sales volume were to increase 500 units to 4,500 units per month, and advertising expense were to increase by $1,000: A) the break-even point would increase. B) the break-even point would decrease. C) the contribution margin ratio would increase. D) operating income would decrease. 4. An accounts receivable results from the sale of: A) Property, plant and equipment for cash B) Goods and services to customers on account C) Goods and services to customers for cash. D) The firm's common stock. E) None of the above 5. A cash equivalent is a current asset that: A) Will be converted to cash within one year. B) Will be converted to cash within one month. C) Is readily convertible into cash with a minimal risk. D) Is readily convertible into cash with a substantial risk.
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E) None of the above. 6. The difference between total receipts and total payments referred to as A) cumulative cash flow. B) beginning cash flow. C) net cash flow. D) cash balance. 7. The difference between the amount of cash on the firm's books and the amount credited to it by the bank is A) an overdraft. B) interest revenue. C) extended disbursement. D) float. 8. Probably the safest and most marketable instrument for short-term investment is A) commercial paper. B) large denomination certificates. C) Treasury notes. D) Treasury bills. 9. Eurodollar certificates of deposits A) are not marketable investments. B) are U.S. dollars held on deposit by foreign banks and loaned out by those banks to anyone seeking dollars. C) pay interest rates usually lower than the rates on U.S. treasury bills. D) are European currencies deposited into international U.S. branch banks. 10. Cash flow does not rely on which of the following? A) the payment patterns of customers B) the monetary policy of the Federal Reserve C) the speed at which suppliers and creditors process checks D) the efficiency of the banking system 11. Inventory is usually divided into three basic categories except A) projected sales. B) work in progress. C) finished goods.
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