2023 1 The best measure of a company s ability to generate sufficient cash to continue as

1) The best measure of a company’s ability to generate sufficient cash to continue as a going concern is net cash provided by

2) A company’s cash flow from investing activities includes

3) A company’s cash flow from operating activities includes

4) A company’s cash flow from financing activities includes:

5) If accounts receivable have increased during the period,

6) If accounts payable have increased during a period,

7) The declaration and payment of a stock dividend would be reported in which section of the statement of cash flows

8) Each of the following is added to net income in computing net cash provided by operation activities except

9) Flynn Company reported a net loss of $10,000 for the year ended December 31, 2005. During the year, accounts receivable decreased $5,000, merchandise inventory increased $8,000, accounts payable increased by $10,000, and depreciation expense of $5,000 was recorded. During 2005, operating activities

10) Advising Company uses the indirect method. During 2005, the company sold equipment for $3,000. the equipment had a book value of $2,700. On a statement of cash flows,

11) During 2005, Kerry Company reported net income of $145,000, including a gain on the sale of equipment of $5,000. the equipment had a cost of $23,000, a book value of $12,000 and was sold for proceeds of $17,000. The company also purchased land for $25,000 during 2005. No other long-term asset account balances changed during the year. Cash flows from investing activities for 2005 total:

12) In a vertical analysis of the income statement, each line item is expressed as a percentage of

13) IN a vertical analysis of the balance sheet, each line item is expressed as a percentage of

use the following to answer questions 14-19

 

Balance sheet

Assets

 

2005                2004

Cash                106,000                       52,000

AR                   85,000                         53,000

Inventories      120,000                       132,000

Prepaid expenses 19,000                    25,000

Investments    90,000                         75,000

Plant assets     310,000                       250,000

Acc depreciation (65,000)                  (60,000)

Total               $665,000         $527,000

 

Liabilities and Stockholder’s Equity

Accounts Payable       93,000                         75,000

Accrued expenses payable 29,000                 24,000

Interest payable                      9,000               5,000

Income tax payable    15,000                         12,000

Bonds payable                        130,000                       160,000

Common stock                       245,000                       170,000

Retained earnings       144,000                       81,000

Total                           $665,000         $527,000

 

Income statement for the year ended 12/31/2005

Sales 490,000

Less:

Cost of goods sold 290,000

Operating expense (include depreciation exp) 77,000

Income taxes 15,000

Interest expense 18,000

Loss on sale of plant assets 3,000

net income 87,000

 

Additional info:

Accounts payable pertain to the purchase of inventory

Plant assets were sold for $65,000. The cost of the plant assets was $80,000

14) cash received rom customers is

15) Cash paid to suppliers is

16)Cash paid for operating expenses is

17) Cash paid for interest expense is

18) Cash paid for income taxes is

19) Cash provided from/used in operating activities is

Use the infomation below to answer questions 20 – 26

Balance Sheet

Assets
2005 2004
Cash 39,000 31,000

Accounts receivable, net 80,000 60,000

Prepaid insurance 22,000 17,000

Land 18,000 40,000

Equipment 70,000 60,000

Accumulated Depreciation (30,000) (23,000)

Total $199,000 $185,000

Liabilities and Stockholder’s Equity
Accounts Payable 11,000 6,000

Bond payable 27,000 19,000

Common stock 140,000 115,000

Retained earnings 21,000 45,000

Total $199,000 $185,000

Additional Information:

net loss for 2005 is $20,000

Land was sold for cash at a loss of $10,000. This was the only land transaction during the year.

Equipment was sold for $5,000 cash. The equipment cost $15,000 and had accumulated depreciation of $11,000.

Equipment was acquired for common stock. The fair market value of the stock at the time of the exchange was $25,000.

For the year 2005:

20) Depreciation expense is

21) The sale of equipment resulted in a

22) refer to the previous question. What is the amount of the gain or loss?

23) The amount of dividends paid is

24) Cash provided from/used in operating activities

25) Cash provided from/used in investing activities

26) Cash provided from/used in financing activities

Use the information below to answer questions 27-40

Balance Sheet

Assets

2007 2006

Cash 25,000 40,000

Short-term investments 15,000 60,000

Accounts receiveable 50,000 30,000

Inventory 50,000 70,000

PPE, net 160,000 200,000

Total $300,000 $400,000

Liabilities and Stockholder’s Equity
Accounts Payable 20,000 30,000

Short-term notes payable 40,000 90,000

Bond payable 80,000 160,000

Common stock 60,000 45,000

Retained earnings 100,000 75,000

Total $300,000 $400,000

 

Income statement

for the year ended 12/31/2007

net sales 360,000

Cost of good sold 184,000

gross profit 176,000

Expenses

Interest expense 12,000

 

selling expense 30,000

administrative exp 59,000

Total exp 101,000

Income before income taxes 75,000

income tax expense 30,000

net income 45,000

 

Additional information:

Cash dividends of 20,000 were declared and paid in 2007.

the par value of the common stock is .50

market value of common stock on 12/31/2007 was $12 per share.

 

For the year 2007:

28) current ratio is

29) acid-test is

30) investory turnover (#) is

31) accounts receivable turnover (#) is

33) net profit margin is

34) gross profit margin is

35) earnings per share is

36) price earnings ratio is

37) debt ratio is Answer 1%

38) times interest earned ratio is

39 total asset turnover is

40) return on assets is