061582RR - Corporations Questions 1 to 20: Select the best answer to each questi
ID: 2581592 • Letter: 0
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061582RR - Corporations Questions 1 to 20: Select the best answer to each question. Note that a question and its answers may be split across a page break, so be sure that you have seen the entire question and all the answers before choosing an answer 1. Fine Furniture Company had a net income of $50,000. Accounts receivable increased by $30,000; inventory decreased by $20,000; amounts payable increased by S4,000; and salaries payable decreased by S1,000. The amount of cash flow from continuing operating activities under the indirect method is A. $43,000 B. $37,000 C. S65,000 D. $55,000 2. Tucker. Inc.'s net sales decreased from S90,000 in year one to $45,000 in year two, and its cost of goods sold decreased from S30,000 in year one to $20,000 in year two. The vertical analysis based on sales for cost of goods sold for the two periods (rounded to nearest tenth of a percent) is A. 300% and 225%. B. 44.4% and 33.3%. C. 225% and 300%. D. 33.3% and 44.4% 3. A business wanting to incorporate must file articles of incorporation with A. the state office dealing with incorporation. B. the federal govemment. C. the local government. D. any state in which they will do business. 4. Which is a value placed on a certificate for a share of the company's stock? A. Market value B. Additional paid-in capital C. Paid-in capital D. Stated value 5. A purchase of new equipment on a note payable under the direct method is reported A. as a separate disclosure as a non-cash transaction B. in the investing section of the cash flow statement. C. in the financing section of the cash flow statement. D. in the operating section of the cash flow statement.Explanation / Answer
1. Answer: Option A. $43,000
2. Answer: Option D. 33.3% and 44.4%
Year 1: Cost of goods sold / Sales = $30000 / $90000 = 33.3%
Year 2: Cost of goods sold / Sales = $20000 / $45000 = 44.4%
3. Answer: Option A. the state office dealing with incorporation
The articles of incorporation can be filed in any state that the business decides to incorporate in. It is to be filed with the secretary or the department of state office.
4. Answer: Option D. Stated value
The value placed on the share certificate of the company’s stock is the stated value.
Please note, per Chegg guidelines, 4 sub-parts have been answered. Please post the remaining separately. Thank you.
Cash flows from operating activities $ Net income 50000 Adjustments to convert net income to a cash basis: Increase in accounts receivable -30000 Decrease in inventory 20000 Increase in payables 4000 Decrease in salaries payable -1000 Net cash provided by operating activities 43000Related Questions
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