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1
A) Total liabilities minus shareholders' equity. B) Current liabilities minus shareholders' equity. C) Fixed assets minus shareholders' equity. D) Current assets minus current liabilities. E) Total assets minus total liabilities. 2
A) Expenses charged against revenues that do not directly affect cash flow. B) The accounts payable of a firm. C) Expenses incurred for the purchase of intangible fixed assets. D) The credit sales of a firm. E) All accounts on the balance sheet other than cash on hand. 3
A) Operating cash flow B) Net working capital C) Capital spending D) Cash flow from assets E) Cash flow to creditors 4
A) Net income divided by the total number of shares outstanding. B) Net income divided by the par value of common stock. C) Gross income multiplied by the par value of common stock. D) Operating income divided by the par value of common stock. E) Net income divided by total stockholders' equity. 5
A) Accounting income is generally equal to firm cash flow. B) Accounting statements are usually prepared to match the timing of income and expenses. C) The balance sheet equity account represents the market value of the firm to shareholders. D) The balance sheet tells investors exactly what the firm is worth. E) Assets are usually listed on the balance sheet at market value. 6
A) II and III only B) III only C) II only D) I and III only E) I only 7
A) I only B) I and III only C) III only D) II only E) II and III only 8
A) Net fixed assets B) Accounts receivable C) Common stock D) Long-term debt E) Retained earnings 9
A) $3.75 million B) $4.25 million C) $4.50 million D) $5.25 million E) $6.75 million 10
A) $1,222 B) $954 C) $800 D) $1,076 E) $654
2002 McGraw-Hill Higher Education