Figure 2-13 Figure 2-13 shows the production possibilities frontiers for Tahiti and Bora Bora. Each country produces two goods, milk and honey. 27) Refer to Figure 2-13. What is the opportunity cost of producing one gallon of honey in Bora Bora? A) 2/3 gallon of milk B) 0.9 gallon of milk C) 1 1/3 gallons of milk D) 1.5 gallons […]
6.3 Unemployment and Full Employment 1) Frictional unemployment is the result of A) an economic recession. B) the economic decline of major industries. C) the normal process of jobs being created and destroyed. D) people not getting along (having friction) with their employers. E) changing weather throughout the year. 2) As firms search for the best employee to fill an opening and the […]
16.2 Fiscal Stimulus 1) As contrasted to the mainstream view, Keynesian economists believe that ________ than mainstream economists believe. A) potential GDP is smaller B) the burden of government debt on future generations is larger C) the real GDP growth rate is higher D) fiscal stimulus is weaker E) the multiplier effect is larger 2) As contrasted to the Keynesian view, mainstream […]
31) A teacher told her students that she will give a riddle which each student has to solve separately and then announce his or her answer in the class. Those who get the correct answer will get a gift. Kate, a student of the class, decided to give the answer which most students gave although the answer she got after solving the riddle was […]
31. Which of the following is a product cost? A. Insurance on factory machineryB. Insurance on delivery trucksC. Lease expense on office computerD. Advertising costs 32. Jasper Corporation incurred the following costs in April: Salesperson’s salaries $40,000 Factory maintenance worker $20,000 Factory insurance 12,000 Administrative utilities 4,000 Factory supervisor salary 30,000 Administrative supplies 1,000 Advertising 15,000 Delivery truck insurance 2,000 Factory machine operator 22,000 Factory machine […]
31) Comparing the short-run Phillips curve and the long-run Phillips curve, we see that there is A) a tradeoff in both curves. B) only a long-run tradeoff between inflation and unemployment but not a short-run tradeoff. C) no tradeoff in either curve. D) only a short-run tradeoff between inflation and unemployment but not a long-run tradeoff. E) no relationship between the two curves. […]
101.DR Electric Supply reported interest expense of $6,300 for the year. Interest payable was $780 and $920 at the beginning and the end of the year, respectively. How much cash did DR Electric Supply pay for interest during the year? A.$6,160 B.$6,440 C.$7,080 D.$5,380 102.Wellington Cabinets sells its merchandise on account. The company has provided the following information for 2014 and 2013: […]
41) According to the innovator’s dilemma: A) the computing power of a microprocessor doubles every 18 months. B) markets that don’t exist can’t be analyzed. C) well-managed companies that listen and respond to needs of established customers may miss opportunities to innovate. D) regulation of e-commerce activities will increase at a rate that is directly proportional to the growth of e-commerce revenues. E) innovations […]
11) Under the Clayton Act and its amendments, which of the following activities is illegal if it creates monopoly? i.contracts that require other goods to be bought from the same firm ii.contracts that prevent a buyer from reselling a product outside a specified area iii.becoming a director of a competing firm A) i only B) ii only C) ii and iii D) i […]
11) If Argentina has an absolute advantage in the production of beef and Guatemala has an absolute advantage in the production of bananas, then A) it is reasonable to expect that specialization and trade will benefit both countries. B) it is reasonable to expect that specialization will benefit both countries, but trade will not. C) neither country has anything to gain from specialization and […]
76. A company has net sales of $1,200,000 and average accounts receivable of $400,000. What is its accounts receivable turnover for the period? A. 0.20.B. 5.00C. 20.0D. 73.0E. 3.0
77. Pepperdine reported net sales of $8,600 million, net income of $126 million and average accounts receivable of $890 million. Its accounts receivable turnover is: A. 37.8.B. 9.7.C. 68.3.D. 7.1.E. 51.7.
78. Axle Co’s accounts receivable turnover was 9.9 for this year and 11.0 for last year. Betterman’s turnover was 9.3 for this year and 9.3 for last year. These results imply that: A. Betterman has the better turnover for both years.B. Axle has the better turnover for both years.C. Betterman’s turnover is improving.D. Axle’s credit policies are too looseE. Betterman is collecting its receivables more quickly than Axle in both years.
79. A company had net sales of $600,000, total sales of $750,000, and an average accounts receivable of $75,000. Its accounts receivable turnover equals: A. .13B. .80C. 7.75D. 8.00E. 10.00
80. A company had total sales of $600,000, net sales of $550,000, and an average accounts receivable of $95,000. Its accounts receivable turnover equals: A. 6.1B. 63.0C. 54.8D. 1.1E. 6.3
81. The matching principle, as applied to bad debts,requires: A. That expenses be ignored if their effect on the financial statements is unimportant to users' business decisions.B. The use of the direct write-off method for bad debts.C. The use of the allowance method of accounting for bad debts.D. That bad debts be disclosed in the financial statements.E. That bad debts not be written off.
82. The materiality constraint, as applied to bad debts: A. Permits the use of the direct write-off method when bad debts expenses are relatively small.B. Requires use of the allowance method for bad debts.C. Requires use of the direct write-off method.D. Requires that bad debts not be written off.E. Requires that expenses be reported in the same period as the sales they helped produce.
83. If the credit balance of the Allowance for Doubtful Accounts account exceeds the amount of a bad debt being written off, the entry to record the write-off against the allowance account results in: A. An increase in the expenses of the current period.B. A reduction in current assets.C. A reduction in equity.D. No effect on the expenses of the current period.E. A reduction in current liabilities.
84. On October 17 of the current year, a company determined that a customer's account receivable was uncollectible and that the account should be written off. Assuming the allowance method is used to account for bad debts, what effect will this write-off have on the company's net income and total assets? A. Decrease in net income; no effect on total assets.B. No effect on net income; no effect on total assets.C. Decrease in net income; decrease in total assets.D. Increase in net income; no effect on total assets.E. No effect on net income; decrease in total assets.
85. Gideon Company uses the allowance method of accounting for uncollectible accounts. On May 3, the Gideon Company wrote off the $2,000 uncollectible account of its customer, A. Hopkins. On July 10, Gideon received a check for the full amount of $2,000 from Hopkins. The entry or entries Gideon makes to record the write off of the accounton May 3 is:
A.
Accounts Receivable—A. Hopkins
2,000
Allowance for Doubtful Accounts
2,000
B.
Allowance for Doubtful Accounts
2,000
Bad debts expense
2,000
C.
Accounts Receivable—A. Hopkins
2,000
Bad debts expense
2,000
Cash
2,000
Accounts Receivable—A. Hopkins
2,000
D.
Allowance for Doubtful Accounts
2,000
Accounts Receivable—A. Hopkins
2,000
E.
Cash
2,000
Accounts Receivable—A. Hopkins
2,000
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