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1. Cash equivalents are a. Short term and highly liquid investments that are readily convertible into cash b. Short term and highly liquid investments that are readily convertible into cash with remaining maturity of three months c. Short term and highly liquid investments that are readily convertible into cash and acquired three months before maturity d. Short term and highly liquid marketable equity securities

1. Cash equivalents are a. Short term and highly liquid investments that are readily convertible into cash b. Short term and highly liquid investments that are readily convertible into cash with remaining maturity of three months c. Short term and highly liquid investments that are readily convertible into cash and acquired three months before maturity d. Short term and highly liquid marketable equity securities

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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1. Cash equivalents are a. Short term and highly liquid investments that are readily convertible into cash b. Short term and highly liquid investments that are readily convertible into cash with remaining maturity of three months c. Short term and highly liquid investments that are readily convertible into cash and acquired three months before maturity d. Short term and highly liquid marketable equity securities 2. This financial analysis tool suggests the number of times average inventory was disposed of during the accounting period. a. Number of days in inventory b. Merchandise Inventory Turnover c Current Ratio d. Average Inventory 3. Inventories are assets (choose the incorrect one) a. Held for sale in the ordinary course of business b. Inthe process of production for sale c. In the form of materials or supplies to be consumed in the production process or in the rendering of service d. Held for use in the production or supply of goods or services l except: 4. Receivable financing includes all ex a. Pledging of receivables b. Assignment of receivables c Transfer of receivables d. Factoring of receivables 5. Which of the following is usually considered as cash? a. Certificate of deposits b. Checking account c Money market certificate d. Postdated checks 6. Which of the following statements is correct? a. The stockholders' equity is a major component of working capital. b. Working capital is a measure of long-term solvency. c. Working capital is d. Working capital is the difference between current assets and current liabilities. fference betv a quick assets current liabilities.
Transcribed Image Text:1. Cash equivalents are a. Short term and highly liquid investments that are readily convertible into cash b. Short term and highly liquid investments that are readily convertible into cash with remaining maturity of three months c. Short term and highly liquid investments that are readily convertible into cash and acquired three months before maturity d. Short term and highly liquid marketable equity securities 2. This financial analysis tool suggests the number of times average inventory was disposed of during the accounting period. a. Number of days in inventory b. Merchandise Inventory Turnover c Current Ratio d. Average Inventory 3. Inventories are assets (choose the incorrect one) a. Held for sale in the ordinary course of business b. Inthe process of production for sale c. In the form of materials or supplies to be consumed in the production process or in the rendering of service d. Held for use in the production or supply of goods or services l except: 4. Receivable financing includes all ex a. Pledging of receivables b. Assignment of receivables c Transfer of receivables d. Factoring of receivables 5. Which of the following is usually considered as cash? a. Certificate of deposits b. Checking account c Money market certificate d. Postdated checks 6. Which of the following statements is correct? a. The stockholders' equity is a major component of working capital. b. Working capital is a measure of long-term solvency. c. Working capital is d. Working capital is the difference between current assets and current liabilities. fference betv a quick assets current liabilities.
7. Working capital management involves investment and financial decisions related to: a. Plant and equipment and current liabilities b. Current assets and capital structure c Current assets and current liabilities d. Sales and credit 8. The following are considered inventories except a. Merchandised purchased by a retailer b. Land and other property not held for sale d. Materials awaiting use in production process c. Finished goods produced 9. Merchandise shipped FOB shipping point on the last day of the year should ordinarily be included in a. The buyer's inventory balance b. The seller's inventory balance C. Neither the buyer's nor seller's inventory balance d. Both the buyer's nor seller's inventory balance 10. Petty cash fund is a. Separately classified as current assets b. Money kept on hand for making minor disbursements d. Restricted cash c Set aside for the payment of payroll
Transcribed Image Text:7. Working capital management involves investment and financial decisions related to: a. Plant and equipment and current liabilities b. Current assets and capital structure c Current assets and current liabilities d. Sales and credit 8. The following are considered inventories except a. Merchandised purchased by a retailer b. Land and other property not held for sale d. Materials awaiting use in production process c. Finished goods produced 9. Merchandise shipped FOB shipping point on the last day of the year should ordinarily be included in a. The buyer's inventory balance b. The seller's inventory balance C. Neither the buyer's nor seller's inventory balance d. Both the buyer's nor seller's inventory balance 10. Petty cash fund is a. Separately classified as current assets b. Money kept on hand for making minor disbursements d. Restricted cash c Set aside for the payment of payroll
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