21/10/12 8:43 PMReview Test Submission: Quiz 5 - Topics 9 & 10 - OPENS 3pm Friday 5 Oct; CLOSES 3pm Friday 12 Oct.

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ACCT1511-Accounting and Financial Management 1B - Session 2, 2012 Online QuizzesReview Test Submission: Quiz 5 - Topics 9 & 10 - OPENS 3pm Friday 5 Oct; CLOSES 3pm Friday 12 Oct.

Review Test Submission: Quiz 5 - Topics 9 & 10 - OPENS 3pmFriday 5 Oct; CLOSES 3pm Friday 12 Oct.

User Sabrina XUSubmitted 11/10/12 13:17Status CompletedScore 5 out of 5 points TimeElapsed

29 minutes out of 11 seconds out of 30 minutes.

Instructions Click Begin to begin: Quiz 5 - Topics 7 & 8 - Topics 9 & 10 - OPENS 3pm Friday 5 Oct;CLOSES 3pm Friday 12 Oct. Click Cancel to go back.

Question 1Hard-up Ltd has a current ratio of 0.75. Its current liabilities amount to $200,000. It borrows$75,000 from a finance company, repayable in 5 years. What is the current ratio following theloan?Selected Answer: B. 1.125

Question 2Which of the following is NOT normally a significant accounting estimate involved in financialmeasurement?SelectedAnswer:

C. how many financial periods will benefit from research and developmentexpenditure

Question 3Trainer Ltd is trying to decide whether to change from the reducing balance method ofdepreciation to the straight-line method for both accounting and tax purposes. Using thereducing balance method at the rate allowable for taxation purposes, the expense would be $1020 000. If it changed to the straight-line method, depreciation expense would be $680 000. Ifthe straight-line method were used instead of the reducing balance method, what would be theeffect on the following? Cash from operations:Selected Answer: D. no effect

Question 4The financial records of Del Ltd reveal the following at 30 June 2009: Net sales for year 120000; Cost of goods sold for year 90 000; Inventory, 1 July 2008 27 000; Accounts receivable, 1July 2008 18 300; Inventory 30 June 2009 33 000A; Accounts receivable, 30 June 2009 21 700;What was the number of days inventory on hand?Selected Answer: A. 121.7 days

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21/10/12 8:43 PMReview Test Submission: Quiz 5 - Topics 9 & 10 - OPENS 3pm Friday 5 Oct; CLOSES 3pm Friday 12 Oct.

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Sunday, 21 October 2012 20:43:18 o'clock EST

Question 5Which of the ratios listed helps to indicate pricing strategy or competition intensity?Selected Answer: B. profit margin

Question 6The financial records of Del Ltd reveal the following at 30 June 2009: Net sales for year 120 000;Cost of goods sold for year 90 000; Inventory, 1 July 2008 27 000; Accounts receivable, 1 July2008 18 300; Inventory 30 June 2009 33 000; Accounts receivable, 30 June 2009 21 700. If DelLtd reduces the number of days inventory on hand to 60, what will be the new inventoryturnover?Selected Answer: B. 6 times p.a.

Question 7Plant Hire Ltd has been in business for one year. The company makes it a practice to capitalise aportion of its advertising costs as a deferred asset and to amortise them at 25% per annum ona straight-line basis. The accountant has suggested to the general manager that the policy ofcapitalising advertising should be ended because the economic benefit of the expenditures isnot clearly determinable. The amount of advertising capitalised this year was $100 000.Whateffect would such a policy change have on net profit before tax?Selected Answer: A. $75 000 reduction

Question 8Which of the following statements about a ratio is NOT true?Selected Answer: B. a ratio is always expressed as a percentage

Question 9Which of the following would be decreased by an accounting policy change involving writing offspoiled inventories?Selected Answer: D. net profit

Question 10Saw Ltds inventory at 1 July 2008 was $16 300, and at 30 June 2009, $23 700. Sales for theyear ended 30 June 2009 were $120 000 and the gross margin was 20%. What was the numberof days inventory on hand?Selected Answer: A. 73 days

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