A company's revenue recognition policy:
A. is usually described in the notes to a company's financial statements.
B. affects the income statement but not the balance sheet.
C. states that revenues should not be recorded until payments are received from customers.
D. defines when its revenue should be collected.
Answer: A
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In 2007, Horwitz Corporation issued ten-year, 9 percent bonds when the market interest rate was 11 percent. Interest is payable annually. During 2010, the market rate of interest for similar bonds was 12 percent. Using the effective interest method of amortization, what interest rate will be used to calculate interest expense for 2010?
a. 12 percent b. 9 percent c. 6 percent d. 11 percent
As of January 1 of the current year, the Grackle Company had accounts receivables of $50,000. The sales for January, February, and March were as follows: $120,000, $140,000 and $150,000. 20% of each months sales are for cash. Of the remaining 80% (the credit sales), 60% are collected in the month of sale, with remaining 40% collected in the following month. What is the total cash collected (both
from accounts receivable and for cash sales) in the month of March? A) $74,800 B) $146,800 C) $102,000 D) $116,800
What are some factors that obstruct managerial judgment and lead to organizational failure?
What will be an ideal response?
A bank can reduce its total amount of loans outstanding by
A) "calling in" loans; that is, by not renewing some loans when they come due. B) selling loans to other banks. C) selling loans to the Federal Reserve. D) doing all of the above. E) doing only A and B of the above.