Which of the following would represent the least likely use of an income statement prepared for a business enterprise?a. Use by customers to determine a company"s ability to provide needed goods and services.b. Use by labor unions to examine earnings closely as a basis for salary discussions.c. Use by government agencies to formulate tax and economic policy.d. Use by investors interested in the financial position of the entity.

You are watching: Which of the following is an example of managing earnings up?


Which of the following is an example of managing earnings down?a. Changing estimated bad debts from 3 percent to 2.5 percent of sales.b. Revising the estimated life of equipment from 10 years to 8 years.c. Not writing off obsolete inventory.d. Reducing research and development expenditures.
Which of the following is an example of managing earnings up?a. Decreasing estimated salvage value of equipment.b. Writing off obsolete inventory.c. Underestimating warranty claims.d. Accruing a contingent liability for an ongoing lawsuit.
What might a manager do during the last quarter of a fiscal year if she wanted to improve current annual net income?a. Increase research and development activities.b. Relax credit policies for customers.c. Delay shipments to customers until after the end of the fiscal year.d. Delay purchases from suppliers until after the end of the fiscal year.
What might a manager do during the last quarter of a fiscal year if she wanted to decrease current annual net income?a. Delay shipments and sales to customers until after the end of the fiscal year.b. Relax credit policies for customers.c. Pay suppliers all amounts owed.d. Delay purchases from suppliers until after the end of the fiscal year.
Which of the following is an advantage of the single-step income statement over the multiple-step income statement?a. It reports gross profit for the year.b. Expenses are classified by function.c. It matches costs and expenses with related revenues.d. It does not imply that one type of revenue or expense has priority over another.
The occurrence that most likely would have no effect on 2020 net income is thea. sale in 2020 of an office building contributed by a stockholder in 1967.b. collection in 2020 of a dividend from an investment.c. correction of an error in the financial statements of a prior period discovered subsequent to their issuance.d. stock purchased in 2002 deemed worthless in 2020.
c. correction of an error in the financial statements of a prior period discovered subsequent to their issuance.
Which of the following is not a selling expense?a. Advertising expenseb. Office salaries expensec. Freight-outd. Store supplies consumed
Which of the following is true of accounting for changes in estimates?a. A company recognizes a change in estimate by making a retrospective adjustment to the financial statements.b. A company accounts for changes in estimates only in the period of change, even though it affects the future periods.c. Changes in estimates are not carried back to adjust prior years.d. Changes in estimates are considered as errors.
A change in accounting principle requires that the cumulative effect of the change for prior periods be shown as an adjustment to:a. beginning retained earnings of the earliest period presented.b. net income of the period in which the change occurred.c. comprehensive income for the earliest period presented.d. stockholders" equity of the period in which the change occurred.
Which of the following is a required disclosure in the income statement when reporting the disposal of a component of the business?a. The gain or loss on disposal should be reported as an unusual gain or loss.b. Results of operations of a discontinued component should be disclosed immediately before income from continuing operations.c. Earnings per share from continuing operations, discontinued operations, and net income should be disclosed on the face of the income statement.d. The gain or loss on disposal should not be segregated, but should be reported together with the results of continuing operations.
c. Earnings per share from continuing operations, discontinued operations, and net income should be disclosed on the face of the income statement.
When a company discontinues an operation and disposes of the discontinued operation (component), the transaction should be included in the income statement as a gain or loss on disposal reported asa. a prior period adjustment.b. an extraordinary item.c. an amount after continuing operations.d. a bulk sale of plant assets included in income from continuing operations.
Which of the following items would be reported net of tax on the face of the income statement?a. Prior period adjustmentb. Unusual gainc. Change in estimates related to allowance for doubtful accountsd. Discontinued operations
In calculating earnings per share, companies deduct preferred dividends from net income if: a. they are noncumulative though not declared.b. the dividends are declared.c. they are convertible preferred shares.d. they are callable preferred shares.
Which of the following items will not appear in the retained earnings statement?a. Net lossb. Prior period adjustmentc. Discontinued operationsd. Dividends
Which one of the following types of losses is excluded from the determination of net income in income statements?a. Material losses resulting from transactions in the company"s investments account.b. Material losses resulting from unusual sales of assets not acquired for resale.c. Material losses resulting from the write-off of intangibles.d. Material losses resulting from correction of errors related to prior periods.
Watts Corporation made a very large arithmetical error in the preparation of its year-end financial statements by improper placement of a decimal point in the calculation of depreciation. The error caused the net income to be reported at almost double the proper amount. Correction of the error when discovered in the next year should be treated asa. an increase in depreciation expense for the year in which the error is discovered.b. a component of income for the year in which the error is discovered, but separately listed on the income statement and fully explained in a note to the financial statements.c. a change in accounting principle for the year in which the error was made.d. a prior period adjustment.
Which of the following is included in comprehensive income?a. Investments by owners.b. Unrealized gains on available-for-sale debt securities.c. Distributions to owners.d. Changes in accounting principles.
Comprehensive income includes all of the following excepta. dividend revenue.b. losses on disposal of assets.c. investments by owners.d. unrealized holding gains.

See more: Ma The Closer The Sample Mean Is To The Population Mean,, Chapter Seven


A statement of stockholders" equity includes a column for each of the following excepta. accumulated other comprehensive income.b. common stock.c. net income.d. retained earnings.
})}else;window.location.assign("https://naipublishers.com/explanations/textbook-solutions/glencoe-accounting-first-year-course-1st-edition-9780078688294");">
*

})}else;window.location.assign("https://naipublishers.com/explanations/textbook-solutions/financial-accounting-4th-edition-9781259730948");">

})}else;window.location.assign("https://naipublishers.com/explanations/textbook-solutions/corporate-finance-the-mcgraw-hillirwin-series-in-finance-insurance-and-real-estate-11th-edition-9780077861759");">
*

Corporate Finance (The Mcgraw-Hill/Irwin Series in Finance, Insurance, and Real Estate)11th EditionBradford D. Jordan, Randolph W. Westerfield, Stephen A. Ross
})}else;window.location.assign("https://naipublishers.com/explanations/textbook-solutions/financial-accounting-4th-edition-9781259307959");">
*