Financial Statements

The line on the balance sheet called ________ represents the entire book value of the residual ownership of a corporation.

• Total equity

• Total long-term liabilities

• Total assets

• Retained Earnings

On a balance sheet, ________ is (are) reported with fixed assets.

• intangible assets

• accounts payable

• preferred stock

• inventory

The balance sheet reports assets in order of:

• increasing size

• book value

• decreasing liquidity

• increasing liquidity

If a firm is profitable and pays income taxes, depreciation expense:

• decreases both operating income and net income.

• increases net fixed assets.

• is a noncash expense that increases net operating income.

• decreases net fixed assets, net income, and operating cash flows.

If total assets increase:

• net working capital must also increase.

• stockholders’ equity must also increase.

• the change must be offset by an equal increase in liabilities and stockholders’ equity.

• net income must be positive.

Ivan's, Incorporated, paid $476 in dividends and $583 in interest this past year. Common stock increased by $193 and retained earnings decreased by $119. What is the net income for the year?

• $476

• $357

• $583

• $776

You find the following financial information about a company: net working capital = $1,059; fixed assets = $6,153; total assets = $8,574; and long-term debt = $4,593. What are the company's total liabilities?

• $7,362

• $5,955

• $5,652

• $8,274

A company has net working capital of $726. Long-term debt is $4,159, total assets are $6,309, and fixed assets are $4,029. What is the amount of total liabilities?

• $5,583

• $4,885

• $5,713

• $8,188

A firm has common stock of $86, paid-in surplus of $230, total liabilities of $390, current assets of $350, and net fixed assets of $560. What is the amount of the shareholders' equity?

• $510

• $170

• $910

• $520

At the beginning of the year, a firm has current assets of $317 and current liabilities of $221. At the end of the year, the current assets are $471 and the current liabilities are $261. What is the change in net working capital?

• $114

• $0

• $154

• $194