Gleis Quiz #4

Jordan Co. had the following gains during the current period:
Gain on disposal of a material operating segment
$500,000
Foreign currency translation gain
100,000
What amount of gain from continuing operations should be presented on Jordan's income stateme

$0

Gar, Inc.'s trial balance reflected the following liability account balances at December 31, Year 6:
Accounts payable
$19,000
Bonds payable, due Year 7
34,000
Deferred income tax payable
4,000
Discount on bonds payable
2,000
Dividends payable on 2/15/Year

$65,000

Which of the following is a component of other comprehensive income?

Cumulative currency-translation adjustments.

Accumulated other comprehensive income is reported in which of the following financial statements?

The statement of financial position.

A partial listing of a company's accounts is presented below:
Revenues
$80,000
Operating expenses
50,000
Foreign currency translation adjustment gain, net of tax
4,000
Income tax expense
10,000
What amount should the company report as net income?

$20,000

Which of the following items is not classified as other comprehensive income (OCI)?

Infrequent in occurrence gains from extinguishment of debt.

Rock Co.'s financial statements had the following balances at December 31:
Infrequently occurring gain
$ 50,000
Foreign currency translation gain
100,000
Net income
400,000
Unrealized gain on available-for-sale
debt securities
20,000
What amount should Ro

$520,000

Burns Corp. had the following items:
Sales revenue
$45�000
Loss on early extinguishment of bonds
36,000
Realized gain on sale of available-for-sale securities
28,000
Unrealized holding loss on available-for-sale debt securities
17,000
Loss on write-down o

$17,000 other comprehensive loss.

What is the purpose of reporting comprehensive income?

To summarize all changes in equity from nonowner sources.

Which of the following statements is correct regarding reporting comprehensive income?

Accumulated other comprehensive income is reported in the equity section of the balance sheet.

Which of the following describes how comprehensive income is reported under U.S. GAAP?

It must be reported in two separate but consecutive statements or in one continuous statement.

When a full set of general-purpose financial statements is presented, comprehensive income and its components

Must be reported in a presentation that includes the components of other comprehensive income and their total.

On December 31, Year 3, Matricula Corp. reported $100,000 in current liabilities. Matricula issued audited financial statements on March 31, Year 4. On February 15, Year 4, the company issued $80,000 of common stock, the proceeds of which were intended to

$100,000

Which of the following defines equity as it relates to a business entity?

Total assets less total liabilities.

A company has the following liabilities at year end:
Mortgage note payable; $16,000 due within 12 months
$355,000
Short-term debt that the company is refinancing with long-term debt
175,000
Deferred tax liability arising from depreciation
25,000
What amou

$16,000

Mill Co.'s trial balance included the following account balances at December 31, Year 6:
Accounts payable
$15,000
Bonds payable, due Year 7
25,000
Discount on bonds payable, due Year 7
3,000
Dividends payable 1/31/Year 7
8,000
Notes payable, due Year 8
20

$45,000

Noncurrent debt should be included in the current section of the statement of financial position if

It matures within the year and will be retired through the use of current assets.

Clear Co.'s trial balance has the following selected accounts:
Cash (includes $10,000 in bond-sinking fund for long-term bond payable)
$50,000
Accounts receivable
20,000
Allowance for doubtful accounts
5,000
Deposits received from customers
3,000
Merchand

$64,000

Comprehensive income is best defined as

The change in net assets for the period excluding owner transactions.

Which of the following items should be reported in other comprehensive income (OCI)?

Unrealized loss on an investment in debt securities classified as an available-for-sale security.

A company reports the following information as of December 31:
Sales revenue
$800,000
Cost of goods sold
600,000
Operating expenses
90,000
Unrealized holding gain on available-for-sale debt securities, net of tax
30,000
What amount should the company repo

$140,000

For a company to obtain a retail business license in a particular state, the company is required to pay the state the equivalent of 3 months of sales taxes on its projected retail sales. This amount is fully refundable after 5 years, provided the company

A noncurrent asset.

A company has outstanding accounts payable of $30,000 and a short-term construction loan in the amount of $100,000 at year end. The loan was refinanced through issuance of long-term bonds after year end but before issuance of financial statements. How sho

Current liabilities of $30,000, noncurrent liabilities of $100,000.

Current assets are reasonably expected to be realized in cash or sold or consumed during the normal operating cycle of the business. Current assets most likely include

Trading debt securities.

A statement of financial position provides a basis for all of the following except

Determining profitability and assessing past performance.

The following is Gold Corp.'s June 30, Year 6, trial balance:
Dr.
Cr.
Cash overdraft
$ 10,000
Accounts receivable, net
$ 35,000
Inventory
58,000
Prepaid expenses
12,000
Land held for resale
100,000
Property, plant, and equipment, net
95,000
Accounts payab

$225,000

How should unearned rent that has already been paid by tenants for the next eight months of occupancy be reported in a landlord's financial statements?

Current liability.

Dixon Company has the following items recorded on its financial records:
Available-for-sale debt securities
$200,000
Prepaid expenses
400,000
Treasury stock
100,000
The total amount of the above items to be shown as assets on Dixon's statement of financia

$600,000

In analyzing a company's financial statements, which financial statement will a potential investor primarily use to assess the company's liquidity and financial flexibility?

Balance sheet.

A company reported the following information for Year 1:
Net income
$34,000
Owner contribution
9,000
Deferred gain on an effective cash-flow hedge
8,000
Foreign currency translation gain
2,000
Prior service cost not recognized in net periodic pension cost

$5,000