96. Jasper makes a $25,000, 90-day, 7% cash loan to Clayborn Co. The amount of interest that Jasper will collect on the loan is: A. $1,750. B. $145.83. C. $437.50. D. $19.44. E. $875.00. 97. Jasper makes a $25,000, 90-day, 7% cash loan to Clayborn Co. Jasper’s entry to record the collection of the note and interest at maturity should be: A. Debit Cash for $25,000; credit Notes Receivable $25,000. B. Debit […]
111. A company purchased a tract of land for its natural resources at a cost of $1,500,000. It expects to mine 2,000,000 tons of ore from this land. The salvage value of the land is expected to be $250,000. The depletion expense per ton of ore is: A. $0.75. B. $0.625. C. $0.875. D. $6.00. E. $8.00. 112. A company purchased a mineral deposit for $800,000. It expects this property to […]
145. Listed below are seven terms listed in alphabetical order followed by a list of phrases that describe or characterize the terms. Match each phrase with the best term placing the letter designating the term in the space provided. Terms: a. Growth stocks b. Horizontal analysis c. Liquidity d. Profitability ratios e. Solvency f. Value Stocks g. Vertical analysis Phrases: _____ […]
95. A list of all the accounts in the accounts receivable ledger with their balances and the total is a: A. Schedule of accounts. B. Controlling account. C. Schedule of accounts receivable. D. Subsidiary ledger. E. Special journal. 96. The Accounts Payable account in the general ledger is: A. A controlling account for the subsidiary accounts payable ledger. B. The account that controls the purchases journal. C. The subsidiary account to the purchases journal. […]
Essay Questions 180.Financial assets (a.) Briefly explain what is meant by the term “financial assets.” (b.) List the three major categories of assets comprising a company’s financial assets. For each category, indicate the basis for valuation in the balance sheet. (a) The term financial assets refers to cash and also those assets easily and directly convertible into known amounts of cash. […]
71) General Hospital uses an indirect overhead job costing system for all patients. In March the critical care and special care facilities had budgeted allocation bases of 4,000 nursing days and 3,000 nursing days, respectively. The budgeted nursing care charges for each department for the month were $2,106,000 and $1,500,000, respectively. The general care area had budgeted costs of $2,700,000 and 7,500 nursing days […]
110.Use this information to answer the following question. Jan. 1 Inventory 15 units @ $4.00 8 Purchase 60 units @ $4.40 17 Purchase 30 units @ $4.20 25 Purchase 45 units @ $4.80 Total sales 100 units A periodic inventory system is used. […]
74. Select the incorrect statement regarding the relevant range of volume. A. Total fixed costs are expected to remain constant. B. Total variable costs are expected to vary in direct proportion with changes in volume. C. Total cost per unit is expected to remain constant. D. Variable cost per unit is expected to remain constant. 75. What are the expected average quarterly costs of running a consulting practice if fixed […]
91. In estimating the amount of uncollectible accounts the accountant (1) estimates the amount of uncollectible accounts that will likely occur over time in connection with sales of each period and (2) makes an entry debiting Bad Debt expense and crediting Allowance for Uncollectible Accounts. The name of this procedure is/are the A. percentage-of-sales B. aging-of-accounts-receivable C. direct write-off D. indirect write-off E. tax accounting 92. Which of the […]
31. Lakeside Company has not declared nor paid dividends on its cumulative preferred stock in the last three years. These dividends should be reported A. in a note to the financial statements. B. as a reduction in stockholders’ equity. C. as a current liability. D. as a noncurrent liability. E. None of these choices is correct. 32. The par value of common stock represents the A. liquidation value of the […]
1. a) Explain how the four uses of Output help us to
determine the GDP.
b) Calculate the GDP using only those numbers that
may be relevant from the following numbers
Consumption $60B
Government purchases $10B
Taxes $15B
Private Sector Gross
Investment $10B
Savings $10B
Imports $6B
Exports $8B
c) Explain
why Real GDP is more relevant for comparing the trends in GDP than a Nominal
GDP?
2. a) Describe using examples the three types of unemployment
we generally come across and which of these are included in the definition of
natural unemployment.
b) Is there a relationship between potential GDP and
Natural unemployment rate? Explain.
c) The unemployment rate in November 2011 came down
to 8.6% from 9.0% in the previous month. What could be a possible reason for
the decrease in the unemployment rate even when many new jobs were not being
created in the economy at that time?
3. a) What are the factors that contribute to the
growth in the economy?
b) How can we attain a faster growth rate in the
economy in the future?
c) The size of the Chinese economy currently is
about half the size of the US economy. But if the Chinese economy continues to
grow at 10% annually while the US economy grows at 3% (our historic average
growth over past many years!), using the Rule of 70 what can we say about the
two economies in the future?
4. a) Show graphically how the AS and AD graphs help to
determine the equilibrium in the economy.
b) Explain using the AS-AD graphs how an increase in
government expenditure will change the equilibrium in the economy. Do it in two
stages. First show how the graph changes with the initial increase in government
expenditure and then what happens after the multiplier process works through
the economy.
c) What is likely to be the effect of such increase
in consumption expenditure on the budget balance for the government?
5. a) What are the three functions money should be able
to perform and how is such money currently created in our economy?
b) Explain the various ways the Federal Reserve can
change the money supply in the economy?
c) If the Federal Reserve is following a restrictive
monetary policy by lowering the money supply in the economy, what will be its
effect on the equilibrium outcome in the economy? Explain using AS-AD analysis.
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