D104 EXAM 2 REVIEW questions with |\ |\ |\ |\ |\ |\
answers
A steel manufacturer uses the production variable method for
|\ |\ |\ |\ |\ |\ |\ |\ |\
depreciating assets. Which combination best describes the |\ |\ |\ |\ |\ |\ |\
depreciation method used? |\ |\
Straight line and activity |\ |\ |\
A company invested $15,000,000 in a coal mine estimated to
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
have 1,500,000 tons of coal. In the first year, the company
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
extracted 100,000 tons of coal. At the end of the first year, it
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
became clear that the coal mine was likely to have only another
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
700,000 tons of coal remaining. Which depletion rate will be used
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
starting in the second year?
|\ |\ |\ |\ |\
20
A company reported total assets of $10,000,000 as of December
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
31, 2018, and $14,000,000 as of December 31, 2019. Net sales
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
revenue was $6,000,000 for the year ending December 31, 2018,
|\ |\ |\ |\ |\ |\ |\ |\ |\
and $8,000,000 for the year ending December 31, 2019. What
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
was the company's asset turnover ratio for the year ending
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
December 31, 2019? |\ |\
.67
A company's profit margin on sales was 2.50%, and its asset
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
turnover was 0.50. What was the company's return on assets for
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
this period? |\
1.25 (.5 * 2.5) |\ |\ |\
A company reported the following information in its 2019 annual
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
report:
Net sales $ 750,000Total assets at the end of year 2 $
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
, 500,000Total assets at the end of year 1 $ 450,000Net income $ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
120,000
What is the company's profit margin on sales?
|\ |\ |\ |\ |\ |\ |\
16%
A company reported the following information in its 2019 annual
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
report:
Net sales $ 750,000Total assets at the end of year 2 $
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
500,000Total assets at the end of year 1 $ 450,000Net income $ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
120,000
What is the company's return on assets?
|\ |\ |\ |\ |\ |\
.25
A local restaurant has taken a $40,000 loan from their bank to
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
perform needed renovations. The restaurant must repay the
|\ |\ |\ |\ |\ |\ |\ |\
borrowed funds in eight months with 3% interest. How should the
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
restaurant record the loan?
|\ |\ |\ |\
DR Cash 40,000
|\ |\
CR N/P 40,000
|\ |\
A company’s normal operating cycle is one year, and they
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
have the following account balances taken from the trial
|\ |\ |\ |\ |\ |\ |\ |\ |\
balance:
Accounts payable: $50,000 |\ |\
Accounts receivable: $25,000 |\ |\
Notes payable (due in 30 months): $15,000
|\ |\ |\ |\ |\ |\
Customer advances: $10,000 |\ |\
Bonds payable (due in 60 months): $30,000
|\ |\ |\ |\ |\ |\
Sales tax payable: $5,000
|\ |\ |\
Which amount should be included as current liabilities on
|\ |\ |\ |\ |\ |\ |\ |\ |\
the balance sheet?
|\ |\
answers
A steel manufacturer uses the production variable method for
|\ |\ |\ |\ |\ |\ |\ |\ |\
depreciating assets. Which combination best describes the |\ |\ |\ |\ |\ |\ |\
depreciation method used? |\ |\
Straight line and activity |\ |\ |\
A company invested $15,000,000 in a coal mine estimated to
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
have 1,500,000 tons of coal. In the first year, the company
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
extracted 100,000 tons of coal. At the end of the first year, it
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
became clear that the coal mine was likely to have only another
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
700,000 tons of coal remaining. Which depletion rate will be used
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
starting in the second year?
|\ |\ |\ |\ |\
20
A company reported total assets of $10,000,000 as of December
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
31, 2018, and $14,000,000 as of December 31, 2019. Net sales
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
revenue was $6,000,000 for the year ending December 31, 2018,
|\ |\ |\ |\ |\ |\ |\ |\ |\
and $8,000,000 for the year ending December 31, 2019. What
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
was the company's asset turnover ratio for the year ending
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
December 31, 2019? |\ |\
.67
A company's profit margin on sales was 2.50%, and its asset
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
turnover was 0.50. What was the company's return on assets for
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
this period? |\
1.25 (.5 * 2.5) |\ |\ |\
A company reported the following information in its 2019 annual
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
report:
Net sales $ 750,000Total assets at the end of year 2 $
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
, 500,000Total assets at the end of year 1 $ 450,000Net income $ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
120,000
What is the company's profit margin on sales?
|\ |\ |\ |\ |\ |\ |\
16%
A company reported the following information in its 2019 annual
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
report:
Net sales $ 750,000Total assets at the end of year 2 $
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
500,000Total assets at the end of year 1 $ 450,000Net income $ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
120,000
What is the company's return on assets?
|\ |\ |\ |\ |\ |\
.25
A local restaurant has taken a $40,000 loan from their bank to
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\ |\
perform needed renovations. The restaurant must repay the
|\ |\ |\ |\ |\ |\ |\ |\
borrowed funds in eight months with 3% interest. How should the
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
restaurant record the loan?
|\ |\ |\ |\
DR Cash 40,000
|\ |\
CR N/P 40,000
|\ |\
A company’s normal operating cycle is one year, and they
|\ |\ |\ |\ |\ |\ |\ |\ |\ |\
have the following account balances taken from the trial
|\ |\ |\ |\ |\ |\ |\ |\ |\
balance:
Accounts payable: $50,000 |\ |\
Accounts receivable: $25,000 |\ |\
Notes payable (due in 30 months): $15,000
|\ |\ |\ |\ |\ |\
Customer advances: $10,000 |\ |\
Bonds payable (due in 60 months): $30,000
|\ |\ |\ |\ |\ |\
Sales tax payable: $5,000
|\ |\ |\
Which amount should be included as current liabilities on
|\ |\ |\ |\ |\ |\ |\ |\ |\
the balance sheet?
|\ |\
