In order to be classified as an extraordinary item in the income statement, an event or transaction should be
a. unusual in nature, infrequent, and material in amount.
b. unusual in nature and infrequent, but it need not be material.
c. infrequent and material in amount, but it need not be unusual in nature.
d. unusual in nature and material, but it need not be infrequent.
Answer: a. unusual in nature, infrequent, and material in amount.
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The premium on bonds payable account would be classified as a(n)
a. current liability; b. adjunct-liability; c. contra-liability; d. noncurrent asset; e. contra-asset
In calculating earning per share, stock options warrants, and rights are
a. always dilutive. b. never dilutive. c. dilutive if the exercise price is less than the average market price of the common stock. d. dilutive if the exercise price is more than the average market price of the common stock.
The primary trade agreement affecting the United States, Canada, and Mexico is _______.
a. NAFTA b. EU c. COMESA d. ASEAN
One problem with ratio analysis is that relationships can be manipulated. For example, we know that if our current ratio is less than 1.0, then using some of our cash to pay off some of our current liabilities would cause the current ratio to increase and thus make the firm look stronger.
Answer the following statement true (T) or false (F)