finance 1

Which of the following will decrease the liquidity level of a firm? a. the purchase of inventory for cash b. the sale of inventory on credit c. the sale of inventory for cash d. the collection of accounts receivable a. the purchase of inventory for cash
An income statement a. reveals the net cash flows of a firm over a stated period of time. b. reflects the financial position of a firm as of a particular date. c. shows the revenue and expenses based upon selected accounting methods. d. records revenue only when cash is received for the product or service provided. e. records expenses based on the recognition principle. c. shows the revenue and expenses based upon selected accounting methods.
Which one of the following is included in net working capital?a. mortgage on a building payable over the next thirty years b. bill payable to a supplier for the purchase of inventory c. equipment with a useful life of six years d. five-year bonds issued to the general public e. depreciation on a fixed asset b.bill payable to a supplier for the purchase of inventory
The average tax rate is defined as the: a. amount of tax due on the next dollar of taxable income. b. total tax paid divided by total revenue. c. amount of tax due on the next dollar of revenue. d. total tax paid divided by total assets. e. total taxes divided by total taxable income. e.. total taxes divided by total taxable income.
Over the past year, a firm increased its current assets and decreased its current liabilities. As a result, the firm’s net working capital: a. increased. b. decreased. c. remained constant. d. could have either increased, decreased, or remained constant. a. increase
The financial statement that summarizes a firm’s operations over a period of time is called a(n) a. income statement.
Shareholders’ equity is equal to:a. total assets plus total liabilities. b. net fixed assets minus total liabilities. c. fixed assets minus long-term debt plus net working capital. d. net working capital plus total assets. e. total assets minus net working capital. c. fixed assets minus long-term debt plus net working capital.
GAAP is: a. the generally accepted accounts payable credit terms. b. the general agreement between a firm and its short-term creditors. c. a commonly accepted method of depreciating fixed assets. d. a common set of standards and procedures for preparing audited financial statements. e. the procedure for expensing variable costs of production. d. a common set of standards and procedures for preparing audited financial statements.
The tax rate applicable to the next dollar of taxable income is called the _____ tax rate.a. total b. marginal c. absolute d. average e. next b. marginal
Trademarks are classified as intangible fixed assets
Net working capital is defined as: a. cash, accounts receivable, and inventory. b. current assets. c. cash minus current liabilities. d. current assets plus current liabilities. e. current assets minus current liabilities. e. current assets minus current liabilities.
Which of the following are classified as tangible fixed assets? a. inventory b. accounts receivable c. patents d. building d. building

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