Chapterh02h-hFinancialhStatements,hTaxes,handhCashhFlow
Chapter 02 h
Financial Statements, Taxes, and Cash Flow
h h h h h
hh
MultiplehChoicehQuestions
h
1.hWhichhonehofhthehfollowinghishthehfinancialhstatemenththathshowshthehaccountinghvaluehofhahfir
m'shequityhashofhahparticularhdate?h
A.hincomehstatement
B.hcreditor'shstatement
C.hbalancehsheet
D.hstatementhofhcashhflows
E.hdividendhstatement
h
2.hNethworkinghcapitalhishdefinedhas:h
A.htotalhliabilitieshminushshareholders'hequity.
B.hcurrenthliabilitieshminushshareholders'hequity.
C.hfixedhassetshminushlong-termhliabilities.
D.htotalhassetshminushtotalhliabilities.
E.hcurrenthassetshminushcurrenthliabilities.
h
3.hThehcommonhsethofhstandardshandhprocedureshbyhwhichhauditedhfinancialhstatementsharehprep
aredhishknownhashthe:h
A.hmatchinghprinciple.
B.hcashhflowhidentity.
C.hGenerallyhAcceptedhAccountinghPrinciples.
D.hFinancialhAccountinghReportinghPrinciples.
E.hStandardhAccountinghValuehGuidelines.
h
4.hWhichhonehofhthehfollowinghishthehfinancialhstatemenththathsummarizeshahfirm'shrevenuehandhe
xpenseshoverhahperiodhofhtime?h
A.hincomehstatement
B.hbalancehsheet
C.hstatementhofhcashhflows
D.htaxhreconciliationhstatement
E.hmarkethvaluehreport
h
2-1
,Chapterh02h-hFinancialhStatements,hTaxes,handhCashhFlow
5.hNoncashhitemshreferhto:h
A.haccruedhexpenses.
B.hinventoryhitemshpurchasedhusinghcredit.
C.hthehownershiphofhintangiblehassetshsuchhashpatents.
D.hexpenseshwhichhdohnothdirectlyhaffecthcashhflows.
E.hsaleshwhichharehmadehusinghstorehcredit.
h
6.hThehpercentagehofhthehnexthdollarhyouhearnhthathmusthbehpaidhinhtaxeshishreferredhtohashtheh____
_htaxhrate.h
A.hmean
B.hresidual
C.htotal
D.haverage
E.hmarginal
h
7.hTheh_____htaxhratehishequalhtohtotalhtaxeshdividedhbyhtotalhtaxablehincome.h
A.hdeductible
B.hresidual
C.htotal
D.haverage
E.hmarginal
h
8.hThehcashhflowhofhahfirmhwhichhishavailablehforhdistributionhtohthehfirm'shcreditorshandhstockhol
dershishcalledhthe:h
A.hoperatinghcashhflow.
B.hnethcapitalhspending.
C.hnethworkinghcapital.
D.hcashhflowhfromhassets.
E.hcashhflowhtohstockholders.
h
2-2
,Chapterh02h-hFinancialhStatements,hTaxes,handhCashhFlow
9.hWhichhtermhrelateshtohthehcashhflowhwhichhresultshfromhahfirm'shongoing,hnormalhbusinesshacti
vities?h
A.hoperatinghcashhflow
B.hcapitalhspending
C.hnethworkinghcapital
D.hcashhflowhfromhassets
E.hcashhflowhtohcreditors
h
10.hCashhflowhfromhassetshishalsohknownhashthehfirm's:h
A.hcapitalhstructure.
B.hequityhstructure.
C.hhiddenhcashhflow.
D.hfreehcashhflow.
E.hhistoricalhcashhflow.
h
11.hThehcashhflowhrelatedhtohinteresthpaymentshlesshanyhnethnewhborrowinghishcalledhthe:h
A.hoperatinghcashhflow.
B.hcapitalhspendinghcashhflow.
C.hnethworkinghcapital.
D.hcashhflowhfromhassets.
E.hcashhflowhtohcreditors.
h
12.hCashhflowhtohstockholdershishdefinedhas:h
A.hthehtotalhamounthofhinteresthandhdividendshpaidhduringhthehpasthyear.
B.hthehchangehinhtotalhequityhoverhthehpasthyear.
C.hcashhflowhfromhassetshplushthehcashhflowhtohcreditors.
D.hoperatinghcashhflowhminushthehcashhflowhtohcreditors.
E.hdividendhpaymentshlesshnethnewhequityhraised.
h
13.hWhichhonehofhthehfollowinghishclassifiedhashanhintangiblehfixedhasset?h
A.haccountshreceivable
B.hproductionhequipment
C.hbuilding
D.htrademark
E.hinventory
h
2-3
, Chapterh02h-hFinancialhStatements,hTaxes,handhCashhFlow
14.hWhichhofhthehfollowingharehcurrenthassets?
I.hpatent
II.hInventory
III.haccountshpayable
IV.hcashh
A.hIhandhIIIhonly
B.hIIhandhIVhonly
C.hI,hII,handhIVhonly
D.hI,hIIhandhIIIhonly
E.hII,hIII,handhIVhonly
h
15.hWhichhonehofhthehfollowinghishincludedhinhahfirm'shmarkethvaluehbuthyethishexcludedhfromhtheh
firm'shaccountinghvalue?h
A.hrealhestatehinvestment
B.hgoodhreputationhofhthehcompany
C.hequipmenthownedhbyhthehfirm
D.hmoneyhduehfromhahcustomer
E.hanhitemhheldhbyhthehfirmhforhfuturehsale
h
16.hWhichhofhthehfollowingharehincludedhinhcurrenthliabilities?h
I.hnotehpayablehtohahsupplierhinheighthmonths
II.hamounthduehfromhahcustomerhnexthmonth
III.haccounthpayablehtohahsupplierhthathishduehnexthweek
IV.hloanhpayablehtohthehbankhinhfourteenhmonthsh
A.hIhandhIIIhonly
B.hIIhandhIIIhonly
C.hI,hII,handhIIIhonly
D.hI,hIII,handhIVhonly
E.hI,hII,hIII,handhIV
h
17.hWhichhonehofhthehfollowinghwillhincreasehthehvaluehofhahfirm'shnethworkinghcapital?h
A.husinghcashhtohpayhahsupplier
B.hdepreciatinghanhasset
C.hcollectinghanhaccountshreceivable
D.hpurchasinghinventoryhonhcredit
E.hsellinghinventoryhathahprofit
h
2-4
Chapter 02 h
Financial Statements, Taxes, and Cash Flow
h h h h h
hh
MultiplehChoicehQuestions
h
1.hWhichhonehofhthehfollowinghishthehfinancialhstatemenththathshowshthehaccountinghvaluehofhahfir
m'shequityhashofhahparticularhdate?h
A.hincomehstatement
B.hcreditor'shstatement
C.hbalancehsheet
D.hstatementhofhcashhflows
E.hdividendhstatement
h
2.hNethworkinghcapitalhishdefinedhas:h
A.htotalhliabilitieshminushshareholders'hequity.
B.hcurrenthliabilitieshminushshareholders'hequity.
C.hfixedhassetshminushlong-termhliabilities.
D.htotalhassetshminushtotalhliabilities.
E.hcurrenthassetshminushcurrenthliabilities.
h
3.hThehcommonhsethofhstandardshandhprocedureshbyhwhichhauditedhfinancialhstatementsharehprep
aredhishknownhashthe:h
A.hmatchinghprinciple.
B.hcashhflowhidentity.
C.hGenerallyhAcceptedhAccountinghPrinciples.
D.hFinancialhAccountinghReportinghPrinciples.
E.hStandardhAccountinghValuehGuidelines.
h
4.hWhichhonehofhthehfollowinghishthehfinancialhstatemenththathsummarizeshahfirm'shrevenuehandhe
xpenseshoverhahperiodhofhtime?h
A.hincomehstatement
B.hbalancehsheet
C.hstatementhofhcashhflows
D.htaxhreconciliationhstatement
E.hmarkethvaluehreport
h
2-1
,Chapterh02h-hFinancialhStatements,hTaxes,handhCashhFlow
5.hNoncashhitemshreferhto:h
A.haccruedhexpenses.
B.hinventoryhitemshpurchasedhusinghcredit.
C.hthehownershiphofhintangiblehassetshsuchhashpatents.
D.hexpenseshwhichhdohnothdirectlyhaffecthcashhflows.
E.hsaleshwhichharehmadehusinghstorehcredit.
h
6.hThehpercentagehofhthehnexthdollarhyouhearnhthathmusthbehpaidhinhtaxeshishreferredhtohashtheh____
_htaxhrate.h
A.hmean
B.hresidual
C.htotal
D.haverage
E.hmarginal
h
7.hTheh_____htaxhratehishequalhtohtotalhtaxeshdividedhbyhtotalhtaxablehincome.h
A.hdeductible
B.hresidual
C.htotal
D.haverage
E.hmarginal
h
8.hThehcashhflowhofhahfirmhwhichhishavailablehforhdistributionhtohthehfirm'shcreditorshandhstockhol
dershishcalledhthe:h
A.hoperatinghcashhflow.
B.hnethcapitalhspending.
C.hnethworkinghcapital.
D.hcashhflowhfromhassets.
E.hcashhflowhtohstockholders.
h
2-2
,Chapterh02h-hFinancialhStatements,hTaxes,handhCashhFlow
9.hWhichhtermhrelateshtohthehcashhflowhwhichhresultshfromhahfirm'shongoing,hnormalhbusinesshacti
vities?h
A.hoperatinghcashhflow
B.hcapitalhspending
C.hnethworkinghcapital
D.hcashhflowhfromhassets
E.hcashhflowhtohcreditors
h
10.hCashhflowhfromhassetshishalsohknownhashthehfirm's:h
A.hcapitalhstructure.
B.hequityhstructure.
C.hhiddenhcashhflow.
D.hfreehcashhflow.
E.hhistoricalhcashhflow.
h
11.hThehcashhflowhrelatedhtohinteresthpaymentshlesshanyhnethnewhborrowinghishcalledhthe:h
A.hoperatinghcashhflow.
B.hcapitalhspendinghcashhflow.
C.hnethworkinghcapital.
D.hcashhflowhfromhassets.
E.hcashhflowhtohcreditors.
h
12.hCashhflowhtohstockholdershishdefinedhas:h
A.hthehtotalhamounthofhinteresthandhdividendshpaidhduringhthehpasthyear.
B.hthehchangehinhtotalhequityhoverhthehpasthyear.
C.hcashhflowhfromhassetshplushthehcashhflowhtohcreditors.
D.hoperatinghcashhflowhminushthehcashhflowhtohcreditors.
E.hdividendhpaymentshlesshnethnewhequityhraised.
h
13.hWhichhonehofhthehfollowinghishclassifiedhashanhintangiblehfixedhasset?h
A.haccountshreceivable
B.hproductionhequipment
C.hbuilding
D.htrademark
E.hinventory
h
2-3
, Chapterh02h-hFinancialhStatements,hTaxes,handhCashhFlow
14.hWhichhofhthehfollowingharehcurrenthassets?
I.hpatent
II.hInventory
III.haccountshpayable
IV.hcashh
A.hIhandhIIIhonly
B.hIIhandhIVhonly
C.hI,hII,handhIVhonly
D.hI,hIIhandhIIIhonly
E.hII,hIII,handhIVhonly
h
15.hWhichhonehofhthehfollowinghishincludedhinhahfirm'shmarkethvaluehbuthyethishexcludedhfromhtheh
firm'shaccountinghvalue?h
A.hrealhestatehinvestment
B.hgoodhreputationhofhthehcompany
C.hequipmenthownedhbyhthehfirm
D.hmoneyhduehfromhahcustomer
E.hanhitemhheldhbyhthehfirmhforhfuturehsale
h
16.hWhichhofhthehfollowingharehincludedhinhcurrenthliabilities?h
I.hnotehpayablehtohahsupplierhinheighthmonths
II.hamounthduehfromhahcustomerhnexthmonth
III.haccounthpayablehtohahsupplierhthathishduehnexthweek
IV.hloanhpayablehtohthehbankhinhfourteenhmonthsh
A.hIhandhIIIhonly
B.hIIhandhIIIhonly
C.hI,hII,handhIIIhonly
D.hI,hIII,handhIVhonly
E.hI,hII,hIII,handhIV
h
17.hWhichhonehofhthehfollowinghwillhincreasehthehvaluehofhahfirm'shnethworkinghcapital?h
A.husinghcashhtohpayhahsupplier
B.hdepreciatinghanhasset
C.hcollectinghanhaccountshreceivable
D.hpurchasinghinventoryhonhcredit
E.hsellinghinventoryhathahprofit
h
2-4
