1. The Amanda Corporation Stockholders' Equity section includes the following information:

• Preferred Stock $12,000
• Paid-in Capital in Excess of Par-Preferred 2,700
• Common Stock 15,000
• Paid-in Capital in Excess of Par-Common 4,100
• Retained Earnings 8,200

What was the total selling price of the preferred stock?

A. $12,000

B. $14,700

C. $20,200

D. $16,100

2. Rick Company has declared a $40,000 cash dividend to shareholders. The company has 5,000 shares of $20 par, 6% preferred stock, and 10,000 shares of $15 par common stock. The preferred stock is cumulative. How much will be distributed to the preferred and common stockholders on the date of payment if the preferred stock is $12,000 in arrears?

A. $40,000 preferred; $0 common

B. $6,000 preferred; $34,000 common

C. $18,000 preferred; $22,000 common

D. $20,000 preferred; $20,000 common

3. For vertical analysis purposes, the base item on the income statement is

A. total expenses.

B. gross profit.

C. net sales.

D. net income.

4. Accounts receivable amounted to $215,000 at the beginning of the year and $245,000 at the end of the year. Income reported on the income statement for the year was $300,000. The cash flow from operating activities on the cash flow statement using the indirect method is

A. $315,000.

B. $300,000.

C. $270,000.

D. $330,000.

5. Patty's Baker has cost of goods sold for the years 2011, 2010, and 2009, respectively, of $28,600, $26,900, and $25,600. If 2009 is the base year, the trend percentage for 2011 is

A. 105.08%.

B. 5.08%.

C. 11.72%.

D. 111.72%.

6. Casey Company has a $2,400 credit balance in Paid-In Capital-Treasury Stock. It sells 500 shares of treasury stock that the company reacquired at $21/share, for $18/share. After the transaction, what will the balance be in the Paid-In Capital in Excess of Par-Treasury account?

A. $1,500 debit

B. $900 credit

C. $900 debit

D. $3,900 credit

7. If Rick's net sales increased from $40,000 to $80,000 and its operating expenses increased from $30,000 to $50,000, then vertical analysis based on net sales would show which of the following for operating expenses for the two periods (to the nearest tenth of a percent)?

A. 62.5% and 75.0%

B. 160.0% and 133.3%

C. 75.0% and 62.5%

D. 133.3% and 160.0%

8. What is the rate of return on equity if net income is $22,700; preferred dividends are $3,000; sales are $100,000; and average common stockholders' equity is $86,000?

A. 86.0%

B. 22.7%

C. 26.4%

D. 22.9%

9. Birch issued 200 shares of $12 par common stock in exchange for a piece of equipment with a current market value of $3,000. Which of the following is not part of the journal entry for this transaction?

A. Debiting equipment for $3,000

B. Crediting common stock for $3,000

C. Crediting paid-in capital in excess of par common for $600

D. Crediting common stock for $2,400

10. Earnings that a stockholder receives from a corporation are an example of which stockholder right?

A. Dividends

B. Preemption

C. Liquidation

D. Vote

11. Operating expenses-other than depreciation-for the year were $335,000. Prepaid expenses decreased by $7,000. Cash payments for operating expenses to be reported on the cash flow statement using the direct method would be

A. $335,000.

B. $342,000.

C. $328,000.

D. $7,000.

12. Birch issued 200 shares of $12 par common stock in exchange for a piece of equipment with a current market value of $3,000. Which of the following is not part of the journal entry for this transaction?

A. Crediting Paid-in Capital in Excess of Par-Common for $600

B. Crediting Common Stock for $2,400

C. Crediting Common Stock for $3,000

D. Debiting Equipment for $3,000

13. The accuracy of the statement of cash flows can be verified by computing the change in the balance of the

A. revenue accounts.

B. cash and cash equivalent accounts.

C. equity account.

D. asset and liability accounts.

14. Cost of goods sold for the year was $850,000. Inventory was $60,000 at the beginning of the year and $90,000 at the end of the year. There were no changes in the amount in accounts payable for the year.

Cash payment for merchandise to be reported under the direct method is

A. $940,000.

B. $910,000.

C. $880,000.

D. $850,000.

15. A company has $56,000 in cash; $12,000 in accounts receivable; $25,000 in short-term investments; and $100,000 in merchandise inventory. The company also has $60,000 in current liabilities. The company's quick ratio is

A. 1.133.

B. 3.217

C. 0.933.

D. 1.550.

16. What is Jane's rate of return on total assets if average total assets are $100,000; net income is $2,000; interest expense if $1,600; and income tax is $2,000?

A. 5.6%

B. 3.6%

C. 4.6%

D. 5.2%

17. Rick Company has declared a $40,000 cash dividend to shareholders. The company has 5,000 shares of $20 par, 6% preferred stock, and 10,000 shares of $15 par common stock. The preferred stock is noncumulative. How much will be distributed to the preferred and common stockholders on the date of payment?

A. $6,000 preferred; $34,000 common

B. $40,000 preferred; $0 common

C. $34,000 preferred; $6,000 common

D. $0 preferred; $40,000 common

18. The Isaiah Corporation Stockholders' Equity section includes the following information:

• Preferred Stock $22,000
• Paid-in Capital in Excess of Par-Preferred 2,980
• Common Stock 48,000
• Paid-in Capital in Excess of Par-Common 3,400
• Retained Earnings 7,350

Total par value of the preferred and common stock is

A. $70,000.

B. $76,380.

C. $77,350.

D. $83,730.

19. Casey Company has an accounts receivable turnover of 36 days, an inventory turnover of 77 days, and an accounts payable turnover of 40 days. Casey's cash conversion cycle is _______ day(s).

A. 1

B. 73

C. 81

D. 153

20. Casey Company reported net income of $35,000; depreciation expenses of $20,000; an increase in accounts payable of $2,000; and an increase in current notes receivable of $3,000. Net cash flows from operating activities under the indirect method is

A. $50,000.

B. $54,000.

C. $55,000.

D. $56,000.