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Accounting 1, Exam 4 Review Flashcards | StudBud
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Accounting 1, Exam 4 Review
Accounting 1, Exam 4 Review
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Principles of Accounting 1 - Exam 4, Chapters 10-12 Review
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1
Stock A had a market price of $120. What would the market price be after a 2 for 1 stock split?
$30
$240
$40
$60
2
It's only possible for the discontinued operations to show a loss.
True
False
3
Public Corporations are required to do which of the following?
Have their financial statements annually audited by a CPA.
Make regular dividend payments.
Have their financial statements reviewed quarterly by a CPA.
Withhold financial information from the public.
4
Retained earnings is best described as...
Income that has been invested back in the business.
assets - liabilities
Cash available for dividends
Amount invested by stockholders
5
Which of the following expenses is not required for an employer to pay?
Workers' compensation insurance
Dental Insurance
Medicare taxes
Social Security Taxes
6
Where is the current portion of long-term debt shown on the balance sheet?
With long term liabilities
With current liabilities
In a special location within long-term liabilities
Between current and long term liabilities
7
A sinking fund is...
Cash set aside for research and development.
Cash set aside from a restriction on retained earnings
The amount of cash invested in the Titanic
Cash set aside to repay bonds on their maturity date.
8
The number of shares used in computing earnings per share is...
Beginning of the year balance of shares outstanding
Year end balance of shares outstanding
The weighted average number of common stock shares
The total of preferred and common stock shares.
9
Z's has Assets of $10M, Liabilities of $1M and owner's equity of $9M. Their debt ratio is...
.11
.1
.75
.05
10
When a company has the right to redeem bonds before the maturity date, the bond is a...
Debenture Bond
Junk Bond
Convertible Bond
Callable Bond
11
If a bond is selling at 103, it is selling...
with a 3% interest guarantee
at a premium
at a discount
for $103
12
Why does a company collect interest on a bond that is purchased between interest payment dates?
So they can pay the stated amount of interest.
So they can pay more than the stated amount of interest.
So they can skip the first interest payment.
So they can pay less than the stated amount of interest.
13
When a company purchases shares of its own stock that have already been issued, it's called
Authorized stock
Treasury Stock
Holdings stock
Buy-back stock
14
Bonds that can be exchanged for shares of stock are called...
Junk Bonds
Debenture Bonds
Convertible Bonds
Mortgage Bonds
15
Which of the following is an example of a prior period adjustment?
The company switched depreciation methods on equipment.
Inventory was miscounted in a previous year.
The company switched inventory methods
The company changed the estimated useful life of their truck
16
In order for a gain or loss to be extraordinary, it must be...
a larger amount than other items on the income statement.
rare and not expected to recur.
material in amount, rare, and not expected to recur.
associated with a part of the business that was discontinued
17
When preferred stock is cumulative...
Preferred stock dividends are guaranteed.
Dividends can't be declared if less than the stated amount.
Dividends in arrears must be paid before other dividends
Preferred stockholders get more than the stated value.
18
The price-earnings ratio is
Market price of a share divided by EPS
Book value of a share divided by EPS
Market price divided by book value
Par valued divided by book value.
19
Common stockholders have all of the following rights
except...
Right to participate in dividends
Right to vote
Right to declare a dividend
Right to distribution of assets
20
Which of the following is not a "date" associated with dividends?
Date of Payment
Date of Record
Date of maturity
Date of declaration
