ACC206 QZ2 ABC has net sales on account of $1,200,000. The average net account receivables are $600,000. The days’ sales in receivables is

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1. ABC has net sales on account of $1,200,000. The average net account receivables are $600,000. The days’ sales in receivables is: (Points : 1)         439.8 days.        304.0 days.        182.5 days.        8.7 days.        None of these is correct 2. Avatar Company uses the indirect method to prepare its statement of cash flows. Please refer to the following information for the year 2014. Net cash flows from operating activities: $32,000 positive Net cash flows from investing activities: $38,000 negative Net cash flows from financing activities: $ 9,000 positive How much was the net change in cash during the year? (Points : 1)         $ 3,000 negative        $79,000 positive        $ 3,000 positive        $61,000 negative        None of these is correct 3. A company has $510,000 in Average common stockholders’ equity, Net income of $312,000, and Preferred dividends paid of $15,000. What is the rate of return on common stockholders’ equity? (Points : 1)         58.2%        61.2%        59.3%        62.0% 4. Which of the following is NOT a true statement about the statement of cash flows? (Points : 1)         It shows where cash came from and how it was spent.        It reports why cash increased or decreased.        It covers a specific span of time the same as the income statement.        It shows how the profits or losses of the company were generated. 5. A company reports net income of $70,000 and net sales of $950,000. Which of the following is the rate of return on net sales? (Points : 1)         0.05        0.20        0.07        0.66        None of these is correct 6. Investing activities include activities that affect the long-term asset section of the balance sheet. (Points : 1)         True         False  7. Operating activities include activities that affect long-term liabilities and stockholders' equity. (Points : 1)         True         False  8. The statement of cash flows explains the difference between net income and the change in cash balance. (Points : 1)         True         False  9. Peartree Company provides the following data: BALANCE SHEET Dec 31, 2014 Dec 31, 2013 Cash $ 21,000 $ 18,000 Accounts receivable, net 31,000 35,000 Inventory 53,000 25,000 PP&E, net 120,000 90,000 Total assets $225,000 $168,000 Accounts payable $4,000 $ 6,000 Accrued liabilities 2,000 1,000 Long-term notes payable 84,000 90,000 Total liabilities $ 90,000 $ 97,000 Common stock $ 30,000 $ 2,000 Retained earnings 113,000 74,000 Treasury stock (8,000) (5,000) Total stockholders’ equity $135,000 $71,000 Total liabilities and stockholders’ equity $225,000 $168,000 How much is the current ratio at year-end 2014? (Points : 1)         17.5        16.1        3.5        0.5        None of these is correct 10. Which of the following are the activities that are included in the operating activities section of the statement of cash flows? (Points : 1)         Activities that obtain the cash needed to launch and sustain the business are included in the operating activities section.        Activities that create revenue or expenses in the entity's major line of business are included in the operating activities section.        Activities that increase or decrease long-term assets are included in the operating activities section.        Activities that pertain to construction of new facilities are included in the operating activities section.