Exam (elaborations)
FNCE 3050 CHAPTER 2 TEST
- Course
- Institution
FNCE 3050 CHAPTER 2 TEST...
[Show more]
Content preview
FNCE 3050 CHAPTER 2 TESTA financial statement provides an _________-based picture of a firm's financial
condition. - ANSWER accounting
Which one of these statements correctly applies to a balance sheet?
- A balance sheet reports assets on the right side and liabilities and equity on the
left side.
- A balance sheet reports cash inflows and outflows over a stated time.
- A balance sheet reports assets, liabilities, and equity accounts in ascending order
of liquidity.
- A balance sheet shows what a firm owns, what it owes, and what it is worth. -
ANSWER A balance sheet shows what a firm owns, what it owes, and what it is
worth
Which of these assets have useful lives exceeding one year and are classified as
fixed assets? Select all that apply.
- Inventory
- Machinery
- Building
- Land - ANSWER Machinery, Building, and Land
Which one of these reports the amount of money a firm owes its creditors within
the next year? - ANSWER current liabilities
Which one of these statements correctly applies to straight-line depreciation?
- Straight-line depreciation is most commonly used when computing a firm's taxes.
- Straight-line depreciation provides a greater tax deduction over the life of an asset
than does MACRS depreciation.
, - Straight-line depreciation decreases a firm's taxes more in the early years than
does MACRS depreciation.
- Straight-line depreciation is commonly used when compiling financial statements
- ANSWER Straight-line depreciation is commonly used when compiling financial
statements
Which one of these is not one of the four basic financial statements?
- Balance sheet
- Statement of ratios
- Income statement
- Statement of cash flows - ANSWER Statement of ratios
What is the definition of an income statement? - ANSWER An income statement
that reports the cash inflows and outflows of a firm over a specific period
What does a balance sheet do? - ANSWER reports a firm's assets, liabilities, and
equity at a particular point in time
Which party has a residual claim to a firm's cash flows? - ANSWER stockholders
Which of these assets are generally converted into cash within one year? Select all
that apply.
- Equipment
- Inventory
- Patents and Trademarks
- Accounts receivable - ANSWER Inventory and Accounts receivable
Which of one of these statements best illustrates the definition of a marginal tax
rate?
- Suenette paid $13,400 in taxes on a taxable income of $52,000, or 25.8 percent.
- Don paid $28,000 in taxes on his $100,000 income, or 28 percent.
- Antonio will pay $0.28 more in taxes if his taxable income increases by $1, or 28
The benefits of buying summaries with Stuvia:
Guaranteed quality through customer reviews
Stuvia customers have reviewed more than 700,000 summaries. This how you know that you are buying the best documents.
Quick and easy check-out
You can quickly pay through credit card or Stuvia-credit for the summaries. There is no membership needed.
Focus on what matters
Your fellow students write the study notes themselves, which is why the documents are always reliable and up-to-date. This ensures you quickly get to the core!
Frequently asked questions
What do I get when I buy this document?
You get a PDF, available immediately after your purchase. The purchased document is accessible anytime, anywhere and indefinitely through your profile.
Satisfaction guarantee: how does it work?
Our satisfaction guarantee ensures that you always find a study document that suits you well. You fill out a form, and our customer service team takes care of the rest.
Who am I buying these notes from?
Stuvia is a marketplace, so you are not buying this document from us, but from seller Mirror. Stuvia facilitates payment to the seller.
Will I be stuck with a subscription?
No, you only buy these notes for $10.99. You're not tied to anything after your purchase.
Can Stuvia be trusted?
4.6 stars on Google & Trustpilot (+1000 reviews)
78140 documents were sold in the last 30 days
Founded in 2010, the go-to place to buy study notes for 14 years now