Question

20. Sebastiani AG reported the following finand Sales Cost of sales SGA Operating income 2007 46,574 14,000 13,720 18,854 6,410 12,444 2006 42,340 13,000 12,200 17,140 5,656 11,484 Income taxes Net income Compared to core operating margin in 2006, Sebastiani's core operating margii 2007 was: A. lower er C. unchanged. 21. A warning sign that ordinary expenses are now being classified as nonrecurrin nonoperating expenses is: A. B. a spike in positive special items followed by falling core operating margin. C. falling core operating margin followed by a spike in negative special items. core operating followed by a spike in positive specialit tems 22. Which of the following obligations must be reported on a company's balance shee A. Capital leases B. Operating leases C. Purchase commitments. 23. The most accurate estimate for off-balance sheet financing related to operating le consists of the sum of A. fu B. future payments less a discount to reflect the related interest component. C. future payments plus a premium to reflect the related interest component. ture payments. 24. The intangible asset goodwill represents the value of an acquired company that canno attached to other tangible assets. This noncurrent asset account is charged to an expe A. as amortization B. when it becomes impaired. C. at the time of the acquisition. 25. Total accruals measured using the balance sheet is most likely to differ from total accı measured using the statement of cash flows when the company has made acquisitic A. financed by debt. B. in exchange for cash C. in exchange for stock.

Answer 1

20. Option c (unchanged 40.48%)

21. Option A falling core operating margin followed by a spike in positive items.

22. Option A capital leases

23. Option B future payments less discount.

24. Option B when it becomes impaired.

25. Option C in exchange for stock.