5 quiz questions on balance sheets:

1. What is the formula for calculating total assets on a balance sheet?

A) Total assets = Total liabilities + Total equity
B) Total assets = Total liabilities - Total equity
C) Total assets = Total equity - Total liabilities
D) Total assets = Current assets + Long-term assets

2. Which of the following is an example of a long-term liability on a balance

sheet?
A) Accounts payable
B) Salaries payable
C) Notes payable due within a year
D) Mortgage payable

3. How is retained earnings calculated on a balance sheet?

A) Retained earnings = Total assets - Total liabilities
B) Retained earnings = Total equity - Total liabilities
C) Retained earnings = Total revenues - Total expenses
D) Retained earnings = Net income - Dividends paid

4. What does the current ratio measure on a balance sheet?

A) The ability of a company to meet its short-term liabilities
B) The percentage of a company's assets financed by debt
C) The efficiency of a company's inventory management
D) The profitability of a company's operations

5. Which of the following is an example of a current asset on a balance sheet?

A) Land
B) Buildings
C) Accounts receivable
D) Patents
five quiz questions on income statements:

1. What is the formula for calculating net income on an income statement?

A) Net income = Total revenue - Total expenses
B) Net income = Gross profit - Total expenses
C) Net income = Total revenue - Cost of goods sold
D) Net income = Operating income - Total expenses

2. Which of the following is considered a non-operating expense on an income

statement?
A) Rent expense
B) Cost of goods sold
C) Interest expense
D) Advertising expense

3. How is earnings per share (EPS) calculated on an income statement?

A) EPS = Total revenue / Number of shares outstanding
B) EPS = Net income / Number of shares outstanding
C) EPS = Gross profit / Number of shares outstanding
D) EPS = Operating income / Number of shares outstanding

4. What is the purpose of the gross profit margin on an income statement?

A) To measure a company's overall profitability
B) To measure a company's efficiency in managing expenses
C) To measure a company's ability to generate sales
D) To measure a company's profitability after accounting for cost of
goods sold

5. Which of the following is considered an operating expense on an income

statement?
A) Depreciation expense
B) Interest expense
C) Cost of goods sold
D) Income tax expense
five quiz questions on cash flow:

1. What is the formula for calculating free cash flow?

A) Free cash flow = Net income + Depreciation - Capital expenditures
B) Free cash flow = Operating cash flow - Capital expenditures
C) Free cash flow = Net income + Depreciation + Capital expenditures
D) Free cash flow = Operating cash flow + Capital expenditures

2. Which of the following activities would be classified as a cash outflow from

operating activities?
A) Collection of accounts receivable
B) Payment of accounts payable
C) Sale of long-term assets
D) Issuance of common stock

3. How is cash flow from investing activities calculated?

A) Cash flow from investing activities = Operating cash flow + Financing cash
flow
B) Cash flow from investing activities = Cash inflows from investments -
Cash outflows from investments
C) Cash flow from investing activities = Net income - Dividends paid
D) Cash flow from investing activities = Changes in current assets and
liabilities

4. Which of the following is considered a non-cash item in a cash flow

statement?
A) Dividends paid
B) Depreciation expense
C) Interest expense
D) Income tax expense

5. How does a negative cash flow from financing activities affect a company's
overall cash flow?
A) It reduces the company's total cash flow
B) It has no impact on the company's total cash flow
C) It increases the company's total cash flow
D) It depends on the magnitude of the negative cash flow from financing
activities