Accounting Problems

Problem 1 Which of the following represents the correct order (from left to right) for the items shown?

A) Net Income (EAT), Sales, Income Tax, COGS
B) Sales, Dividends, COGS, Income Tax
C) Sales, Income Tax, COGS, Administrative Expenses
D) Sales, COGS, Income Tax, Net Income (EAT)

Problem 2 A balance sheet is analagous to a company's _______________.

A) income tax statement
B) net worth statement
C) cash flow statement
D) income statement

Problem 3 Which of these items is most likely to appear on a balance sheet?

A) Interest expense
B) SG&A
C) Sales
D) Current assets

Problem 4 Which of the following represents debts that must be paid within the next 12 months?

A) Long-term bonds
B) Current assets
C) Long-term liabilities
D) Current liabilities

Problem 5 For the following, calculate the company's net income (EAT) (use only what data you need): Sales = 1,000. Income tax rate = 50%. COGS = 10% of sales. SG&A expense = 50. Interest expense = 25. Dividend payout ratio = 25%.

A) 850.00
B) 412.50
C) 309.37
D) 825.00

Problem 6 If a company pays off 1,000 in long-term debt (liabilities), which of the following must be true?

A) Current assets decreased by 1,000.
B) Long-term liabilities increased by 1,000.
C) Current liabilities increased by 1,000.