The balance sheet of Hidden Valley Farms reports total assets of $450,000 and $550,000 at the beginning and end of the year,

The balance sheet of Hidden Valley Farms reports total assets of $450,000 and $550,000 at the beginning and end of the year, respectively. The return on assets for the year is 10%.
What is Hidden Valley's net income for the year?

A) $5,000,000.

B) $55,000.

C) $5,500,000.

D) $50,000.

Answer: D

The balance sheet of Hidden Valley Farms reports total assets of $450,000 and $550,000 at the beginning and end of the year, respectively. Net income and sales for the year are $100,000 and $800,000, respectively.
What is Hidden Valley's asset turnover?

A) 1.6 times.

B) 1.8 times.

C) 1.5 times.

D) 0.2 times.

Answer: A

Recognition of impairment for long-term assets is required if book value exceeds:

A) Original cost.

B) Fair value.

C) Future cash flows.

D) Accumulated depreciation.

Answer: C

The balance sheet of Purdy's BBQ reports total assets of $800,000 and $900,000 at the beginning and end of the year, respectively.

The balance sheet of Purdy's BBQ reports total assets of $800,000 and $900,000 at the beginning and end of the year, respectively. The return on assets for the year is 20%.
What is Purdy's net income for the year?

A) $4,500,000.

B) $170,000.

C) $4,250,000.

D) $85,000.

Answer: B

The balance sheet of Hidden Valley Farms reports total assets of $450,000 and $550,000 at the beginning and end of the year, respectively. Net income and sales for the year are $100,000 and $800,000, respectively.
What is Hidden Valley's return on assets?

A) 10%.

B) 20%.

C) 160%.

D) 18%.

Answer: B

The balance sheet of Hidden Valley Farms reports total assets of $450,000 and $550,000 at the beginning and end of the year, respectively. Net income and sales for the year are $100,000 and $800,000, respectively.
What is Hidden Valley's profit margin?

A) 10%.

B) 12.5%.

C) 18%.

D) 22%.

Answer: B

The balance sheet of Purdy's BBQ reports total assets of $800,000 and $900,000 at the beginning and end of the year, respectively

The balance sheet of Purdy's BBQ reports total assets of $800,000 and $900,000 at the beginning and end of the year, respectively. Net income and sales for the year are $85,000 and $1,700,000, respectively.
What is Purdy's profit margin?

A) 5%.

B) 10%.

C) 20%.

D) 50%.

Answer: A

The balance sheet of Purdy's BBQ reports total assets of $800,000 and $900,000 at the beginning and end of the year, respectively. Net income and sales for the year are $85,000 and $1,700,000, respectively.
What is Purdy's asset turnover?

A) 0.5 times.

B) 20.0 times.

C) 10.0 times.

D) 2.0 times.

Answer: D

The balance sheet of Purdy's BBQ reports total assets of $800,000 and $900,000 at the beginning and end of the year, respectively

The balance sheet of Purdy's BBQ reports total assets of $800,000 and $900,000 at the beginning and end of the year, respectively. Net income and sales for the year are $85,000 and $1,700,000, respectively.
What is Purdy's return on assets?

A) 10%.

B) 20%.

C) 200%.

D) 5%.

Answer: A

The balance sheet of Paradise Pizza reports total assets of $1,500,000 and $1,700,000 at the beginning and end of the year, respectively. Net income and sales for the year are $240,000 and $2,000,000, respectively.
What is Paradise Pizza's asset turnover?

A) 1.25 times.

B) 1.33 times.

C) 8.33 times.

D) 0.80 times.

Answer: A

The balance sheet of Paradise Pizza reports total assets of $1,500,000 and $1,700,000 at the beginning and end of the year, respectively

The balance sheet of Paradise Pizza reports total assets of $1,500,000 and $1,700,000 at the beginning and end of the year, respectively. Net income and sales for the year are $240,000 and $2,000,000, respectively.
What is Paradise Pizza's profit margin?

A) 15%.

B) 14.12%.

C) 16%.

D) 12%.

Answer: D

The balance sheet of Paradise Pizza reports total assets of $1,500,000 and $1,700,000 at the beginning and end of the year, respectively. Net income and sales for the year are $240,000 and $2,000,000, respectively.
What is Paradise Pizza's return on assets?

A) 15%.

B) 14.12%.

C) 16%.

D) 12%.

Answer: A

Return on assets is equal to:

A) Profit margin plus asset turnover.

B) Profit margin minus asset turnover.

C) Profit margin times asset turnover.

D) Profit margin divided by asset turnover.

Answer: C

Losses on the sale of long-term assets for cash:

A) Are the excess of the book value over the cash received.

B) Are recorded as a credit.

C) Are reported on a net-of-tax basis, if material.

D) Are the excess of the cash received over the book value.

Answer: A

Gains on the sale of long-term assets for cash:

A) Are the excess of the book value over the cash received.

B) Are recorded as a debit.

C) Are reported on a net-of-tax basis, if material.

D) Are the excess of the cash received over the book value.

Answer: D

Return on assets is calculated as:

A) Net Income divided by total assets.

B) Net Income divided by average total assets.

C) Net Income divided by ending total assets.

D) Ending total assets divided by net income.

Answer: B

Oregon Adventures purchased equipment for $80,000. They sold the equipment at the end of three years for $45,000

Oregon Adventures purchased equipment for $80,000. They sold the equipment at the end of three years for $45,000. If the expected useful life of the equipment was seven years with a residual value of $10,000, and they use straight-line depreciation, which of the following is true regarding the entry to record the sale of the equipment?

A) Debit Loss $5,000.

B) Credit Gain $5,000.

C) Credit Accumulated Depreciation $40,000.

D) Credit Equipment $5,000.

Answer: A

ABO purchased a truck at the beginning of 2021 for $140,000. They sold the truck at the end of 2022 for $95,000. If the expected useful life of the truck was six years with a residual value of $20,000 and ABO uses straight-line depreciation, which of the following is true regarding the entry to record the sale of the truck?

A) Credit Gain $5,000.

B) Debit Loss $5,000.

C) Credit Accumulated Depreciation $40,000.

D) Credit Equipment $100,000.

Answer: B

Career Services, Incorporated sold some office equipment for $52,000 on December 31, 2021. The journal entry to record the sale would include which of the following if the original cost of the equipment was $80,000 with a residual value of $5,000 and a useful life of 10 years? Assume the machine was purchased on January 1, 2018, and depreciated using the straight-line method.

A) Gain of $2,000.

B) Loss of $9,500.

C) Gain of $9,500.

D) Loss of $2,000.

Answer: A