Finance And Accounting

Question: What gives the lessee the right to purchase the asset for a price less than the predicted fair market value of the asset when the option is exercised?
A
Tax Form

B
Stock Option Agreement

C
Loan Agreement

D
Bargain Purchase Option

Note: Answer not sure
1. Report
Question: The market value method is used to account for _______________.
A
minority, passive investments

B
minority, active investments

C
majority, active investments

D
None of these

Note: Answer not sure
1. Report
Question: Which of the following is generally a worksheet procedure when preparing consolidated statements?
A
Elimination of the parent company's investment account

B
Elimination of intercompany receivables and payables

C
Elimination of intercompany sales and purchases

D
All of these

Note: Answer not sure
1. Report
Question: XYZ Company reports book income of $96,000 and taxable income of $120,000 (the $24,000 difference is attributed to warranty expenses). The statutory tax rate is 30 percent and the company reports a current liability for income taxes payable of $36,000 on its Year 1 Balance Sheet. In its Income Statement, the company reports income tax expense at an effective rate of 37.5 percent. Given the above information, the difference between the statutory tax rate and the effective tax rate is due to __________________.
A
a temporary difference that resulted in book income exceeding taxable income

B
a temporary difference that resulted in taxable income exceeding book income

C
a permanent difference that resulted in book income exceeding taxable income

D
a permanent difference that resulted in taxable income exceeding book income

Note: Answer not sure
1. Report
Question: XYZ Company reports book income of $720,000 for Year 1, which includes a Warranty Expense of $80,000. For tax purposes, warranty costs are not deductible until incurred. Actual expenditures for warranty costs during Year 1 totaled $48,000. The tax rate for Year 1 is 30 percent. Given the above information, how did book and tax income relate in Year 1?
A
Book income exceeded taxable income.

B
Taxable income exceeded book income.

C
Book income equaled taxable income.

D
The difference between book income and taxable income is due to a permanent difference.

Note: Answer not sure
1. Report
Question: Eliminations to remove intercompany transactions are typically made __________________.
A
in separate books for the consolidated entity

B
in the parent company's books

C
on a consolidated work sheet

D
in the subsidiary company's books

Note: Answer not sure
1. Report
Question: The term "cash flow hedge" refers to _________________.
A
a transaction in which a company acquires a derivative and attempts to reduce risks involving fluctuations in a market value

B
a transaction in which a company acquires a derivative and attempts to reduce the risk in future streams of cash flow

C
a transaction that must be recorded and continue to be reported at the acquiring cost

D
All of these

Note: Answer not sure
1. Report
Question: XYZ Company reports book income of $720,000 for Year 1, which includes a Warranty Expense of $80,000. For tax purposes, warranty costs are not deductible until incurred. Actual expenditures for warranty costs during Year 1 totaled $48,000. The tax rate for Year 1 is 30 percent. Given the above information, what amount should XYZ Company report as a current liability for Income Tax Payable on its December 31 Year 1 Balance Sheet?
A
$192,000

B
$201,600

C
$216,000

D
$225,600

Note: Answer not sure
1. Report
Question: Which of the following statements about derivatives is true?
A
A derivative can be an asset.

B
A derivative can be a liability.

C
A derivative is presented on the Balance Sheet at its fair market value at the end of the period.

D
All of these statements are true.

Note: Answer not sure
1. Report
Question: Financial statements for parent and subsidiary companies are generally consolidated for ______________________ investments.
A
minority, passive

B
minority, active

C
majority, active

D
None of these

Note: Answer not sure
1. Report

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Question: What gives the lessee the right to purchase the asset for a price less than the predicted fair market value of the asset when the option is exercised?

Question: The market value method is used to account for _______________.

Question: Which of the following is generally a worksheet procedure when preparing consolidated statements?

Question: Eliminations to remove intercompany transactions are typically made __________________.

Question: The term "cash flow hedge" refers to _________________.

Question: Which of the following statements about derivatives is true?

Question: Financial statements for parent and subsidiary companies are generally consolidated for ______________________ investments.