When comparing inventory turnover ratios, other things being equal, A) higher inventory turnover results from old or obsolete inventory increasing the inventory balance on the balance sheet. B) a higher inventory turnover is preferred to improve liquidity. C) higher inventory turnover results from an increase in the selling price of the product. D) a lower […]
Following catastrophic hurricane losses, South Coast Insurance Company changed its deductible provision. Rather than using a specified dollar value, $250 for example; the dollar value of the deductible increases with the size of the loss. The type of deductible that South Coast changed to is called a(n) A) calendar-year deductible. B) aggregate deductible. C) straight […]
Cash and credit management are typically the responsibility of the A) treasurer. B) vice president of production and operations. C) controller. D) chief executive officer, or CEO. ANSWER A
The homeowners policy excludes a loss brought about by two or more perils where one peril is covered under the policy and the other perils are excluded. This situation is called A) ordinance or law. B) proximate cause. C) concurrent causation. D) nullification. ANSWER Answer: C
Given the following financial statements for ACME Corporation, what amount did the company pay in dividends for 2010? Income Statement Balance Sheet Year Ended 12/31/10 12/31/2010 12/31/2009 Sales $1,300,000 Current Assets $50,000 $45,000 Cost of Goods Sold 750,000 Gross Fixed Assets 880,000 650,000 Operating Expenses 200,000 Less Accumulated Depreciation 450,000 350,000 Depreciation Expense 100,000 Fixed […]
Several different values can be considered when determining how much insurance should be carried on a dwelling (the Coverage A limit of the Homeowners 3 policy). The appropriate value that should be used is: A) the home’s market value. B) the home’s actual cash value. C) the home’s appraised value for property tax purposes. D) […]
Which of the following statements is (are) true regarding how the Homeowners 3 policy handles the peril of collapse? I. Collapse is specifically excluded, and there are no exceptions to the exclusion. II. Collapse that is caused by a Coverage C peril is covered. A) I only B) II only C) both I and II […]
Which of the following statements concerning the coverage of collapse of the dwelling under an unendorsed Homeowners 3 policy is true? A) There is no coverage for collapse, regardless of the cause of the collapse. B) Collapse is covered if it is caused by one of the Coverage C perils. C) If collapse is caused […]
In a private placement, the securities are offered and sold to a limited number of investors. Indicate whether the statement is true or false ANSWER TRUE
Pro forma financial statements are an accountant’s way of looking back to see what “might have been.” Indicate whether the statement is true or false ANSWER FALSE
