Question

1. A company receives an advance payment for special-order goods to be manufactured and delivered within 6 months. The advance payment should be reported on the company's balance sheet as a:

   	a.	deferred charge.
   	b.	contra-asset account.
   	c.	current liability.
   	d.	noncurrent liability.

1 points   

QUESTION 2

1. Current assets include cash and all other assets expected to become cash or be consumed:

   	a.	within one year.
   	b.	within one operating cycle.
   	c.	within one year or one operating cycle, whichever is shorter.
   	d.	within one year or one operating cycle, whichever is longer.

1 points   

QUESTION 3

1. New Oaks Winery requires two months to make wine, two years to age it, one month to bottle it, two months to sell it, and one month to collect the receivable. Its operating cycle is:

   	a.	twelve months.
   	b.	thirty months.
   	c.	six months.
   	d.	three months.

1 points   

QUESTION 4

1. Which is a shareholders' equity account in the balance sheet?

   	a.	accumulated depreciation.
   	b.	paid-in-capital.
   	c.	dividends payable.
   	d.	marketable securities.

1 points   

QUESTION 5

1. Cash equivalents would include:

   	a.	highly liquid equity securities.
   	b.	accounts receivable from a financial institution.
   	c.	a sinking fund for bonds that mature in three years.
   	d.	debt instruments with maturity dates of less than three months from the date of the purchase.

Answer 1

A company receives an advance payment for special- order goods to be manufactured and delivered within 6 months. The advance payment should be reported on the company's balance sheet as a: Current Liability Current assets include cash and all other assets expected to become cash or be consumed: within one year or one operating cycle, whichever is longer. New Oaks Winery requires two months to make wine, two years to age it, one month to bottle it, two months to sell it, and one month to collect the receivable. Its 3. operating cycle is: Which is a shareholders' equity account in the balance 4. sheet? Thrity months =2+24+1+2+1 remaining options are part in Balance Sheet, but not in Shareholder's Equity Paid in Capital debt instruments with maturity dates of less than three months from the date of the purchase. 5. Cash equivalents would include: Remaining options are long term assets & liabilities