Questions from General Accounting

Q: Give an example of an industry that would be characterized by

Give an example of an industry that would be characterized by (a) a high asset turnover and a low profit margin, and (b) a low asset turnover and a high profit margin.

Q: Malor Inc. needs to upgrade its diagnostic equipment. At the

Malor Inc. needs to upgrade its diagnostic equipment. At the time of purchase, Malor had expected the equipment to last 8 years. Unfortunately, it was obsolete after only 4 years. Ronald Nolan, CFO of...

Q: Nida Hat Shop received a shipment of hats for which it paid

Nida Hat Shop received a shipment of hats for which it paid the wholesaler $2,940. The price of the hats was $3,000, but Nida was given a $60 cash discount and required to pay freight charges of $75....

Q: Adriana is studying for the next accounting examination. She asks your

Adriana is studying for the next accounting examination. She asks your help on two questions: (a) What is salvage value? (b) How is salvage value used in determining depreciable cost under the strai...

Q: What does Tootsie Roll use as the estimated useful life on its

What does Tootsie Roll use as the estimated useful life on its buildings? On its machinery and equipment?

Q: What is the primary basis of accounting for inventories? What is

What is the primary basis of accounting for inventories? What is the major objective in accounting for inventories?

Q: Scribner Company reports net sales of $800,000, gross

Scribner Company reports net sales of $800,000, gross profit of $560,000, and net income of $230,000. What are its operating expenses?

Q: Espinosa Corporation has been using the FIFO cost flow method during a

Espinosa Corporation has been using the FIFO cost flow method during a prolonged period of inflation. During the same time period, Espinosa has been paying out all of its net income as dividends. What...

Q: Stan Koevner believes that the allocation of cost of goods available for

Stan Koevner believes that the allocation of cost of goods available for sale should be based on the actual physical flow of the goods. Explain to Stan why this may be both impractical and inappropria...

Q: Heineken Electronics has enjoyed tremendous sales growth during the last 10 years

Heineken Electronics has enjoyed tremendous sales growth during the last 10 years. However, even though sales have steadily increased, the company’s CEO, Beth Dains, is concerned abo...