Multiple Choice Questions  1.All of the following are capital investment decisions except:    A. acquiring $100,000 of common stock.   B. buying a $5,000,000 manufacturing plant.   C. purchasing equipment for $80,000.   D. paying $600,000 to renovate a restaurant.     2.Which of the following is not a factor in explaining why the present value of a future dollar is less than one dollar?    A. Inflation   B. Interest   C. Risk […]

  146. An increase in the accounts receivable account during the year should be reported on the statement of cash flows as:A. An increase in cash flows from operating activitiesB. An increase in cash flows from investing activitiesC. A decrease in cash flows from operating activitiesD. A decrease in cash flows from investing activitiesE. An increase in cash flows from financing activities 147. A decrease […]

    137. Cardinal Company’s bank statement showed a balance at May 31 of $180,974. The only reconciling items consisted of a large number of outstanding checks totaling $51,847. At May 31, what balance should Cardinal’s Cash account show?  A. $232,821. B. $129,127. C. $77,280. D. Some other amount.     138. On January 1, Wong Company established a petty cash fund of $300. The journal entry to record the replenishment […]

    51.Omega Company reported the following information for the company’s two products:  Assume that 75,000 machine hours are available; product X takes 4 machine hours to produce, and product Y takes 2 machine hours to produce. The company can sell all it can make of either product. Which of the following statements is true?    A. Product Y should be produced because more of it can be […]

  55.Which of the following statements regarding accounting information systems are not true?    A. Accounting information systems collect and process data from transactions and events. B. Accounting information systems organize data in useful forms. C. Accounting information systems are not subject to internal control policies. D. Accounting information systems are useful to effective decision making. E. Accounting information systems communicate information to business decision makers. 56.Which of the following statements […]

    11. The percent of fixed assets to total assets is an example of: A. vertical analysis.B. solvency analysis.C. profitability analysis.D. horizontal analysis.   12. What type of analysis is indicated by the following?        Increase (Decrease*)   2012 2011 Amount Percent Current assets $   380,000 $   500,000 $120,000* 24%* Fixed assets 1,680,000 1,500,000 180,000 12%           A. Vertical analysisB. Horizontal analysisC. Liquidity analysisD. Common-size analysis   13. An analysis in which […]

      177.A company has three employees. Total salaries for the month of January were $8,000. The federal income tax rate for all employees is 15%. The FICA—social security tax rate is 6.2% and the FICA—Medicare tax rate is 1.45%. Calculate the amount of employee taxes withheld and prepare the company’s journal entry to record the January payroll assuming these were the only deductions. […]

  Learning Objective 3-2   1) Adjusting entries for accruals will never affect ________. A) shareholders’ equity B) expenses C) liabilities D) cash   2) Lumbers, Inc. lends $3,000 at 12% to an employee on September 1, 2012. The employee agrees to pay the interest and principal in two years. Which of the following will be reported on Lumbers’ year ended December 31, 2012 financial […]

    121. Mocha Company manufactures a single product by a continuous process, involving three production departments. The records indicate that direct materials, direct labor, and applied factory overhead for Department 1 were $100,000, $125,000, and $150,000, respectively. Work in process at the beginning of the period for Department 1 was $75,000, and work in process at the end of the period totaled $60,000. The records […]

  149.A balance sheet that places the liabilities and equity to the right of the assets is a(n):    A.Account form balance sheet. B.Report form balance sheet. C.Interim balance sheet. D.Classified balance sheet. E.Unclassified balance sheet. 150.Under the alternative method for accounting for unearned revenue, which of the following pairs of journal entry formats is correct?     A.Initial EntryAdjusting Entry CashUnearned Consulting Revenue Unearned Consulting RevenueConsulting […]