Strayer ACC556 FINAL EXAM Part 2 Latest 2019 April

ACC556 Financial Accounting for Managers

FINAL Exam Part 2

Question 1If the board of directors authorizes a $100,000 restriction of retained earnings for a future plant expansion, the effect of this action is to

Question 2 A revenue generally

Question 3 Holden Packaging Corporation began business in 2014 by issuing 80,000 shares of $5 par common stock for $8 per share and 20,000 shares of 6%, $10 par preferred stock for par. At year end, the common stock had a market value of $10. On its December 31, 2014 balance sheet, Holden Packaging would report

Question 4 Assume the following sales data for a company:

2015 $910,000

2014 $770,000

2013 700,000

If 2013 is the base year, what is the percentage increase in sales from 2013 to 2014?

Question 5 Which one of the following items is not necessary in preparing a statement of cash flows?

Question 6 Which of the following is not typically a characteristic experienced by a company during the growth phase of the corporate life cycle?

Question 7 Quincy Corp. earned controllable margin of $500,000 on sales of $6,400,000. The division had average operating assets of $5,200,000. The company requires a return on investment of at least 8%. How much is residual income?

Question 8 The date on which a cash dividend becomes a binding legal obligation is on the

Question 9 A manager of a cost center is evaluated mainly on

Question 10 A flexible budget

Question 11 Cochran Corporation, Inc. has the following income statement (in millions):

COCHRAN CORPORATION, INC.

Income Statement

For the Year Ended December 31, 2014

Net Sales $240

Cost of Goods Sold 80

Gross Profit 160

Operating Expenses 65

Net Income $ 95

Using vertical analysis, what percentage is assigned to net income?

Question 12 The following information pertains to Marsh Company. Assume that all balance sheet amounts represent average balance figures.

Total asset $400,000

Stockholders’ equity—common 200,000

Total stockholders’ equity 280,000

Sales revenue 120,000

Net income 25,000

Number of shares of common stock 8,000

Common dividends 9,000

Preferred dividends 6,000

What is Marsh’s payout ratio?

Question 13 All of the following statements regarding changes in accounting principles are true except which of the following?

Question 14 Ratios are used as tools in financial analysis

Question 15 Which of the following income statement figures would probably be the best indicator of a company’s future performance?

Question 16 Bogey Co. recorded operating data for its Cheap division for the year. Bogey requires its return to be 10%.

Sales $ 1,400,000

Controllable margin 160,000

Total average assets 4,000,000

Fixed costs 100,000

What is the ROI for the year?

Question 17 If there were 60,000 pounds of raw materials on hand on January 1, 120,000 pounds are desired for inventory at January 31, and 410,000 pounds are required for January production, how many pounds of raw materials should be purchased in January?

Question 18 A critical factor in budgeting for a service firm is to

Question 19 A master budget consists of

Question 20 A comparison with other companies that provides insight into a company's competitive position is most commonly known as which of the following types of comparisons?

Question 21Which one of the following is not a benefit of budgeting?

Question 22 The primary purpose of the statement of cash flows is to

Question 23 On the basis of the budget reports,

Question 24 Zoum Corporation had the following transactions during 2014:

1 - Issued $125,000 of par value common stock for cash.

2 - Recorded and paid wages expense of $60,000.

3 - Acquired land by issuing common stock of par value $50,000.

4 - Declared and paid a cash dividend of $10,000.

5 - Sold a long-term investment (cost $3,000) for cash of $3,000.

6 - Recorded cash sales of $400,000.

7 - Bought inventory for cash of $160,000.

8 - Acquired an investment in Zynga stock for cash of $21,000.

9 - Converted bonds payable to common stock in the amount of $500,000.

10 - Repaid a 6 year note payable in the amount of $220,000.

What is the net cash provided by operating activities?

Question 25 The single most important output in preparing financial budgets is the