Social Science Questions

22) Ajax enterprises, Inc. has the following income statement items: sales of $48,250,000; operating expenses of $10,225,000; cost of goods sold of $32,025,000; and interest expense of $650,000. If the firm's income tax rate is 34%, what is the amount of the firm's income tax liability?A) $1,665,000B) $2,040,000C) $1,819,000D) $1,385,000

19) Which of the following statements regarding the income statement is INCORRECT?A) The income statement shows the retained earnings and expenses at a given point in time. B) The income statement shows the flow of earnings and expenses generated by the firm between two dates.C) The last or "bottom" line of the income statement shows the firm's net income.D) The first line of an income statement lists the revenues from the sales of products or services.

Nicolas loves watching The Simpsons on his local public TV station, but he never sends any money to support the station during its fundraising drives.a. What name do economists have for people like Charlie? Explain.b. How can the government solve the problem caused by people like Charlie?c. Can you think of ways the private market can solve this problem? How does the existence of cable TV alter the situation?

25) Balance sheets and income statements connect through the retained earnings account.

24) A firm's balance sheet provides a representation of the current market value of the company.

20) Cash flows from assets will always be less than cash flows from financing due to dividends.

16) Which of the following adjustments to net income is NOT correct if you want to calculate cash flow from financing activities?A) Add dividends paidB) Add any increase in long-term borrowingC) Add proceeds from sale of stockD) Add any increase in short-term borrowing

22) Reducing a firm's debt will increase its cash flow.

15) Which of the following adjustments to net income is NOT correct if you want to calculate cash flow from operating activities? A) Add increases in accounts payableB) Add increases in accounts receivableC) Add back depreciationD) Depreciation is deducted when calculating net income

23) Cash flows from assets will always be less than cash flows from financing due to dividends.

24) Beginning cash balance + cash flow from operations + cash flow from investing activities + cash flow from financing activities = ending cash balance.

VAT to be paid what side of Balance sheet ?

VAT credit what side of balance sheet ?

2) Which of the following does NOT represent cash outflows to the firm?A) TaxesB) Interest paymentsC) DividendsD) Depreciation

13) To determine the cash flow from operating activities, certain adjustments must be made which includeA) Add back depreciation, amortization, and stock-based compensation expenses.B) Adjust for any changes in operating assets and liabilities.C) Add or subtract any changes in deferred income taxes.D) All of the above.

7) Which of the following is NOT a section on the cash flow statement?A) Income-generating activitiesB) Investing activitiesC) Operating activitiesD) Financing activities

5) Which of the following represents a source of cash?A) A decrease in accounts payableB) A decrease in accounts receivableC) Payment of dividendsD) An increase in inventories

12) Which of the following statements regarding net income transferred to retained earnings is correct?A) Net income = net income transferred to retained earnings - dividendsB) Net income transferred to retained earnings = net income + dividendsC) Net income = net income transferred to retain earnings + dividendsD) Net income transferred to retain earnings - net income = dividends

21) In a growing business, negative cash flow from investing activities is normal.

14) Which of the following is NOT a reason why cash flow may not equal net income? A) Amortization is added in when calculating income.B) Changes in inventory will change cash flows but not income.C) Capital expenditures are not recorded on the income statement.D) Depreciation is deducted when calculating net income.