Discussion

     dWhich item belongs in the investing section of the statement of cash flow?Question 1 options:

    depreciation expense

    proceeds from sale of fixed asset

    dividends

    gain on sale of fixed asset

    Question 2 (5 points)

    On January 2, 2019, All Good Company purchased 11,000 shares of the stock of Big Bad Company, and DID NOT obtain significant influence.  The investment is intended as a long-term investment.  The stock was purchased for $13.00 per share, and represents a 10% ownership stake.  Big Bad Company made $45,000 of net income in 2020, and paid dividends to All Good Company of $65,000 on December 15, 2020.  On December 31, 2020, Big Bad Company’s stock was trading on the open market for $16.50 per share at the end of the year.  Use this information to determine the unrealized gain or loss on the investment that should be reported at year end by All Good Company.  If it is a loss, enter as a negative number.  Round to nearest whole number (no cents).

    Your Answer:Question 2 options:Answer

    Question 3 (5 points)

    SavedThe percent of fixed assets to total assets is an example ofQuestion 3 options:vertical analysissolvency analysisprofitability analysishorizontal analysis

    Question 4 (5 points)

    Saved

    The following information is related to Towson Company’s fiscal year 2020.

     Income Statement:

     Net Income  $4,000,000

     Depreciation Expense                450,000

     Loss on Sale of Plant Assets       40,000

     Interest Expense  5,000

     Balance Sheet – 12/31/17: Increase (Decrease)

     Accounts Payable decrease       35,000

     Plant Assets – Purchased  250,000

     Plant Assets – Disposals  (100,000)

     Additional Information:

     Common Stock exchanged for outstanding Long Term Notes Payable of $125,000

     Dividends paid were $30,000

    Use this information to determine Towson Company’s Net Cash Flows from Operating Activities. If the amount is an outflow then enclose the amount with dollar sign inside of brackets ( ).

    Your Answer:Question 4 options:Answer

    Question 5 (5 points)

    The following financial information is for Chesapeake Corporation are for the fiscal years ending 2020 & 2019 (all balances are normal):

    Item/Account

    2020

    2019

    Cash

    $35,000

    $24,000

    Accounts Receivable

    56,000

    52,000

    Inventory

    50,000

    32,000

    Current Liabilities

    76,000

    42,000

    Net Sales (all credit)

    550,000

    485,000

    Cost of Goods Sold

    311,000

    265,000

    Use this information to determine the number of days in inventory for 2020: (Use a 365 day year.  Round & enter your answers to one decimal place and enter the value.)

    Your Answer:Question 5 options:Answer

    Question 6 (5 points)

    The following financial information is for Chesapeake Corporation are for the fiscal years ending 2020 & 2019 (all balances are normal):

    Item/Account

    2020

    2019

    Cash

    30,000

    $24,000

    Accounts Receivable

    46,000

    52,000

    Inventory

    49,000

    48,000

    Current Liabilities

    78,000

    42,000

    Net Sales (all credit)

    550,000

    485,000

    Cost of Goods Sold

    288,000

    265,000

    Use this information to determine the number of current ratio as of December 31, 2020: (Round & enter your answers to one decimal place and enter the value.)

    Your Answer:Question 6 options:Answer

    Question 7 (5 points)

    Ocean Pines Company had net income $525,000. They also had depreciation expense of $175,000, an increase or (decrease) in accounts receivable of $20,000, and an increase or (decrease) in inventory of $-25,000. Ocean Pines prepares their Statement of Cash Flows using the indirect method.  Use this information to determine the dollar value of cash provided or (used) by operating activities. A negative number for accounts receivable or inventory indicates that the balance decreased. Enter as a whole number (no cents).

    Your Answer:Question 7 options:Answer

    Question 8 (5 points)

    Match each ratio that follows to its use (items ah).  Items may be used more than once.Question 8 options:12345678working capital12345678quick ratio12345678current ratio12345678ratio of liabilities to stockholders equity12345678rate earned on common stockholders equity12345678rate earned on total assets12345678dividends per share12345678price-earnings (P/E) ratio12345678ratio of sales to assets12345678earnings per share (EPS) on common stock1.assess the profitability of the assets2.assess the effectiveness in the use of assets3.indicate the ability to meet currently maturing obligations4.indicate the margin of safety to creditors5.indicate instant debt-paying ability6.assess the profitability of the investment by common stockholders7.indicate future earnings prospects8.indicate the extent to which earnings are being distributed to common stockholders

    Question 9 (5 points)

    On the statement of cash flows, the cash flows from financing activities section would includeQuestion 9 options:receipts from the sale of investmentspayments for the acquisition of investmentsreceipts from a note receivablereceipts from the issuance of capital stock

    Question 10 (5 points)

    Allstar Company signed a $250,000 mortgage on July 1, 2021 for the purchase of their new garage building. The mortgage entailed equal monthly payments of $2,700 at the end of each month. The interest rate is 7% per year.  How much interest expense will be paid on August 31, 2021? Do not use actual days; assume a 360 day year and 30 day months. Round your answer to the nearest whole number (no cents).

    Your Answer:Question 10 options:Answer

    Question 11 (5 points)

    Annapolis Company purchased a $4,000, 8%, 10-year bond at 103 and held it to maturity. The straight line method of amortization is used for both premiums & discounts. What is the net cash received over the life of the bond investment?   (all money received minus all money paid, round to nearest whole dollar)

    Your Answer:Question 11 options:Answer

    Question 12 (5 points)

    In calculating cash flows from operating activities using the indirect method, a gain on the sale of equipment isQuestion 12 options:added to net incomededucted from net incomeignored because it does not affect cashreported supplementally as a noncash investing and financing activity

    Question 13 (5 points)

    On January 1, 2021, Baltimore Company issued $300,000 face value, 5%, 5-year bonds at 101.  Baltimore uses the straight-line method for amortization. Use this information to determine the dollar value of the annual bond premium amortization. Round your answer to the nearest whole number (no cents).

    Your Answer:Question 13 options:Answer

    Question 14 (5 points)

    The ability of a business to pay its debts as they come due and to earn a reasonable net income isQuestion 14 options:solvency and leveragesolvency and profitabilitysolvency and liquiditysolvency and equity

    Question 15 (5 points)

    At fiscal year end, December 31, 2018, Somerset Corporation had total stockholders’ equity of $3,100,000. On FY 2018 year end, Somerset Corporation had Common Stock account of $1,700,000 of $10 par value common stock and Preferred Stock account of $150,000 of $100 par value stock.  There was no treasury stock. The preferred stock was noncumulative and non-callable.  Use this information to determine the book value per share of Common Stock as of end of the FY 2018: (Round your answer to the nearest penny.)

    Your Answer:Question 15 options:Answer

    Question 16 (5 points)

    The current period statement of cash flows includes the following:

    Cash balance at the beginning of the period

    $310,000

    Net cash flow from operating activities

    185,000

    Net cash flow used for investing activities

    43,000

    Net cash flow used for financing activities

    97,000

    The cash balance at the end of the period is

    Question 16 options:$45,000$635,000$355,000$125,000

    Question 17 (5 points)

    Identify the section of the statement of cash flows (a-d) where each of the following items would be reported.Question 17 options:1234Decrease in inventory1234Loss on sale of equipment1234Payment of dividends to stockholders1234Increase in accounts receivable1234Purchase of the stock of another company as investment1234Sale of machinery held for use by the company1234Exchange of land for note payable1234Increase in income taxes payable1234Issuance of bond payable1234Dividends received on investment1.Operating activities2.Financing activities3.Investing activities4.Schedule of noncash financing and investing

    Question 18 (5 points)

    On January 1, 2020, Baltimore Company issued $150,000 face value, 8%, 10-year bonds at 102.  Interest is paid annually on January 1.  Baltimore uses the straight-line method for amortization. Use this information to determine the dollar value of the interest expense for the 2020 calendar year. Round your answer to the nearest whole number (no cents).

    Your Answer:Question 18 options:Answer

    Question 19 (5 points)

    On January 2, 2020, All Good Company purchased 10,000 shares of the stock of Big Bad Company, and DID obtain significant influence.  The investment is intended as a long-term investment.  The stock was purchased for $10.00 per share, and represents a 30% ownership stake.  Big Bad Company made $450,000 of net income in 2020, and paid dividends to All Good Company of $40,000 on December 15, 2020.  Big Bad Company’s stock was trading on the open market for $17.50 per share at the end of the year.  Use this information to determine the book value of the investment that should be reported at year end by All Good Company. Round to nearest whole number (no cents).

                                                                                                                                      Order Now