Accounting Questions - Long-term creditors are usually most interested in evaluating
Not what you're looking for?
I am having problems with a couple of various questions that I'm expecting similar questions on an upcoming test. I would appreciate any help on these practice questions:
1.) Dividends paid
a. increase assets.
b. increase expenses.
c. decrease revenues.
d. decrease retained earnings
2.) Long-term creditors are usually most interested in evaluating
a. liquidity and profitability.
b. consistency and profitability.
c. liquidity and solvency.
d. consistency and solvency
3.) The constraint of conservatism is best expressed as:
a. the cost of applying an accounting principle should not exceed its benefit.
b. only material items should be recorded and reported.
c. when in doubt, choose the method that will least likely overstate assets and net income.
d. the lower of cost or market method should be used for inventories.
4.)Which of the following combinations presents correct examples of liquidity, profitability, and solvency ratios, respectively?
Liquidity Profitability Solvency
a.Inventory turnover Inventory turnover Times interest earned
b.Current ratio Inventory turnover Debt to total assets
c.Receivable turnover Return on assets Times interest earned
d.Average days collection Payout ratio Return on assets
Purchase this Solution
Solution Summary
This solution is comprised of an explanation to answer the various accounting questions.
Solution Preview
1.) Dividends paid
a. increase assets.
b. increase expenses.
c. decrease revenues.
d. decrease retained earnings
Answer: D
2.) Long-term creditors are usually most interested in evaluating
a. liquidity and profitability.
b. consistency and profitability.
c. liquidity and ...
Purchase this Solution
Free BrainMass Quizzes
Introduction to Finance
This quiz test introductory finance topics.
Basics of corporate finance
These questions will test you on your knowledge of finance.
Organizational Behavior (OB)
The organizational behavior (OB) quiz will help you better understand organizational behavior through the lens of managers including workforce diversity.
Managing the Older Worker
This quiz will let you know some of the basics of dealing with older workers. This is increasingly important for managers and human resource workers as many countries are facing an increase in older people in the workforce
Business Ethics Awareness Strategy
This quiz is designed to assess your current ability for determining the characteristics of ethical behavior. It is essential that leaders, managers, and employees are able to distinguish between positive and negative ethical behavior. The quicker you assess a person's ethical tendency, the awareness empowers you to develop a strategy on how to interact with them.