The purpose of financial statement analysis for external users is to provide information to improve efficiency and effectiveness.
Answer the following statement true (T) or false (F)
False
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During 2016, Penny Co had net income of $200,000 including after-tax interest expense of $30,000 on convertible bonds. The $300,000 face value of convertible bonds can be converted into common stock at the rate of 300 shares per $1,000 bond. Prior to the conversion, there were 400,000 shares of common stock outstanding. What is the amount of fully diluted earnings per share?
A) $0.500 B) $0.469 C) $0.408 D) not determinable because the bonds are not dilutive
The existence or occurrence assertion as related to cash is concerned with proper classification on the balance sheet
a. True b. False Indicate whether the statement is true or false
Which of the following is an example of community property?
A. Property exchanged for separate property B. Property acquired by a spouse during the marriage as a gift or by inheritance C. Property a spouse owned before the marriage D. Property acquired during the marriage through a spouse's industry or efforts
Flower Company had beginning inventory of $19,000, purchases were $100,000, and ending inventory had a cost of $25,000 and a market value of $20,000 . Which of the following is/are not true?
a. Cost of Goods Sold is $5,000 larger when the firm records ending inventory at lower of cost or market than when it records the inventory at acquisition cost. b. The loss of $5,000 increases Cost of Goods Sold by $5,000 and therefore reduces net income by $5,000, compared to the acquisition cost basis. c. The firm should disclose the existence of large write-downs included in Cost of Goods Sold in the notes so that users of financial statements understand the components of the Cost of Goods Sold account. d. The firm should disclose the existence of large write-downs included in Cost of Goods Sold in Managements' Discussion and Analysis so that users of financial statements understand the scope of the asset impairment. e. none of the above