The ________ states that the intent to contract is judged by the reasonable person standard and not by the subjective intent of the parties
A) Restatement of the Law of Contracts
B) Restatement (Second) of Contracts
C) objective theory of contracts
D) common law of contracts
C
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The following information pertains to Newman Company. Assume that all balance sheet amounts represent both average and ending balance figures and that all sales were on credit. Assets Cash and short-term investments $ 40,000 Accounts receivable (net) 30,000 Inventory 25,000 Property, plant, and equipment 215,000 Total Assets $310,000 Liabilities and Stockholders' Equity Current liabilities $
60,000 Long-term liabilities 95,000 Stockholders' equity—Common 155,000 Total liabilities and stockholders' equity $310,000 Income Statement Sales $90,000 Cost of goods sold 45,000 Gross margin $45,000 Operating expenses 20,000 Net income $25,000 Number of shares of common stock 6,000 Market price of common stock $40 Dividends per share $1.00 Cash provided by operations $40,000 What is the rate earned on total assets for this company? a. 8.1% b. 6.8% c. 10.5% d. 16.1%
Assume that the net sales for a company is $5,000, cost of goods sold is $3,000, and average inventory is $1,500 . Calculate the number of days' sales in inventory
a. 145 b. 274 c. 110 d. 183
Midtown, Inc. had the following transactions in 2018, its first year of operations:
• Issued 31,000 shares of common stock. Stock has par value of $1.00 per share and was issued at $20.00 per share. • Earned net income of $70,000. • Paid no dividends. At the end of 2018, what is total stockholders' equity? A) $31,000 B) $690,000 C) $620,000 D) $70,000
Some costs that possibly could be traced directly to cost objects are nonetheless classified as indirect costs because:
A. Generally accepted accounting principles require some costs to be treated as indirect. B. Such practice results in a more accurate accumulated cost for the object. C. Such costs cannot be traced to objects in a cost-effective manner. D. All of the answers are correct.