Question 1

Which financial statement provides a snapshot of a company's financial position at a specific point in time, showing assets, liabilities, and equity?

Accepted Answer

Balance Sheet

Question 2

A company reports the following for the year: Revenues of $$500,000, Expenses of 350$$,000, and Dividends paid of $$30,000. What is the ending balance of Retained Earnings if the beginning balance was 100$$,000? Use the formula: $$	ext{Ending Retained Earnings} = 	ext{Beginning Retained Earnings} + 	ext{Net Income} - 	ext{Dividends}$$

Accepted Answer

$$220,000$$

Question 3

Which of the following best describes the purpose of the Statement of Cash Flows?

Accepted Answer

To summarize the cash inflows and outflows from operating, investing, and financing activities

Question 4

If a company purchases equipment for $$50,000 cash, how does this transaction affect the accounting equation $$	ext{Assets} = 	ext{Liabilities} + 	ext{Equity}$?

Accepted Answer

Assets increase by $$50,000 and decrease by 50$$,000; no net effect on total assets

Question 5

Which of the following transactions would NOT affect the Statement of Stockholders' Equity?

Accepted Answer

Purchasing inventory for cash

Question 6

A company has total assets of $$800,000 and total liabilities of 500$$,000. What is the company's equity? Use the formula: $$	ext{Equity} = 	ext{Assets} - 	ext{Liabilities}$$

Accepted Answer

$$300,000$$

Question 7

Which section of the Statement of Cash Flows would the cash paid for purchasing a new building be reported under?

Accepted Answer

Investing Activities

Question 8

If a company reports net income of $$120,000, depreciation expense of 10$$,000, and an increase in accounts receivable of $$5,000, what is the cash flow from operating activities? Use the formula: $$	ext{Cash Flow from Operations} = 	ext{Net Income} + 	ext{Depreciation} - 	ext{Increase in Accounts Receivable}$

Accepted Answer

$$125,000$$

Question 9

Which of the following is NOT a component of the Balance Sheet?

Accepted Answer

Revenues

Question 10

A company issues $100,000 of common stock. How does this transaction affect the financial statements?

Accepted Answer

Increase assets and increase equity

Question 11

Which of the following best describes the accrual basis of accounting?

Accepted Answer

Revenues are recorded when earned and expenses when incurred, regardless of cash flow

Question 12

A company has the following balances: Cash $$40,000, Accounts Receivable 30$$,000, Inventory $$20,000, Accounts Payable 25$$,000, and Common Stock $$65,000. What is the total assets? Use the formula: $$	ext{Total Assets} = 	ext{Cash} + 	ext{Accounts Receivable} + 	ext{Inventory}$

Accepted Answer

$$90,000$$

Question 13

Which financial statement would you analyze to determine a company's ability to generate future cash flows?

Accepted Answer

Statement of Cash Flows

Question 14

If a company pays $15,000 in dividends, how does this affect the Statement of Stockholders' Equity?

Accepted Answer

Decrease in retained earnings

Question 15

Which of the following is a financing activity on the Statement of Cash Flows?

Accepted Answer

Issuing bonds

Question 16

A company has net income of $$80,000, depreciation expense of 5$$,000, and a decrease in accounts payable of $$2,000. What is the cash flow from operating activities? Use the formula: $$	ext{Cash Flow from Operations} = 	ext{Net Income} + 	ext{Depreciation} - 	ext{Decrease in Accounts Payable}$

Accepted Answer

$$83,000$$

Question 17

Which of the following would be considered an investing activity?

Accepted Answer

Selling equipment

Question 18

If a company has revenues of $$200,000 and expenses of 150$$,000, what is its net income? Use the formula: $$	ext{Net Income} = 	ext{Revenues} - 	ext{Expenses}$$

Accepted Answer

$$50,000$$

Question 19

Which of the following is NOT a purpose of financial statement analysis?

Accepted Answer

Determining market share

Question 20

A company reports the following: Beginning Retained Earnings $$60,000, Net Income 40$$,000, Dividends $$10,000. What is the ending Retained Earnings? Use the formula: $$	ext{Ending Retained Earnings} = 	ext{Beginning Retained Earnings} + 	ext{Net Income} - 	ext{Dividends}$

Accepted Answer

$$90,000$$

FINA3675 - Financial Statement Analysis: Course Syllabus and Schedule Study Notes

Guida di studio - Domande di pratica

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