Question $1$:

In which cases the application of the method of comparable is justified?

A$.$ Valuation of firms in monopolistic market

B$.$ Valuation of underpriced firms

C$.$ Valuation of private or thinly traded firms under the assumption that their stock are not efficiently traded

D$.$ None of these

Question $2$:

Which of the following statements concerning financial rations is incorrect?

A$.$ Accounting principles and methods used by a company will not affect financial ratios.

B$.$ The informational value of a ratio in isolation is limited$.$

C$.$ A ratio is one number expressed as a percentage or fraction of another number

D$.$ Calculation of financial ratios is not sufficient for a complete financial analysis of a company.

Question $3$:

What is the last year depreciation expense compute under straight line depreciation method? Acquisition cost $=70,000,$ residual value $=3,000,$ estimated useful life $=4$ years.

Answer:

Question $4$:

What is the Impairment loss, given the following information:

Acquisition cost $=130,000,$ accumulated depreciation $=50,000,$ Accumulated impairment losses $=7,000,$ Fair value less cost to sell $=70,000,$ value in use $68,000?$

Answer:

Question $5$:

What is the ending balance of the Allowance for doubtful receivable, given the following information January $1.2010,$ the allowance for Doubtful Accounts of Alpha Inc. has a $10,500$ credit balance and Accounts Receivable has a $150,000$ debit balance. On December $31,$ some receivables are written down by $7,500$

Answer:

Question $6$:

What is the correct Cost of Goods Sold under the FIFO method given the following information? Beginning Inventory: $50$ units @$10,$ purchase $1$:$15$ units @$13,$ Purchase $2$: $15$ units @$15,$ Ending Inventory: $12$ units. Assume that the sale occurs after all inventory purchase.

Question $7$:

What is the correct Cost of Goods Sold under the LIFO method given the following information? Beginning Inventory: $35$ units @$17,$ Purchase $1$: $10$ units @$22,$ Purchase $2$: $15$ units @$35.$ Ending Inventory $40$ units. Assume that the sale occurs after all inventory purchases.

Question $8$:

On December $31,$ before any year$-$end adjustments, the Account Receivable balance of Alpha Company is $150,000.$ The Allowance for Doubtful Account has a $7,500$ credit balance. Alpha Company prepares the following aging schedule for Accounts Receivable:

Age of Accounts

Total balance $1-30$ days $31-60$ days $61-90$ days Over $90$ days

$50,00040,00030,00030,000$

Estimated uncollectible $1\%4\mathrm{.}0\%5\mathrm{.}0\%40\mathrm{.}0\%$

Given the previous information, what is the increase in the expense for bad receivable?

Answer: