The Financial Statements for Silver Service Company Include the Following

question 146

Multiple Choice

The financial statements for Silver Service Company include the following items: $\begin{array}{lrr}&2019&2018\\\text { Cash } & \$ 50,500 & \$ 42,000 \\\text { Short-term Investments } & 26,000 & 14,500 \\\text { Net Accounts Receivable } & 52,000 & 48,000 \\\text { Merchandise Inventory } & 131,000 & 51,000 \\\text { Total Assets } & 532,000 & 548,000 \\\text { Accounts Payable } & 132,500 & 127,00 \\\text { Salaries Payable } & 16,000 & 16,000 \\\text { Long-term Note Payable } & 57,000 & 57,00\end{array}$ Compute the acid-test ratio for 2018. (Round your answer to two decimal places)

• A) 0.87
• B) 0.73
• C) 0.82
• D) 0.63

Analyze the impact of inventory valuation methods on financial reporting.

Calculate and interpret inventory turnover ratios.

Understand the principles and effects of writing down inventory to net realizable value.

Understand correcting entries for previously understated or overstated inventories.

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Definitions:

Aaron Beck

A psychiatrist known for developing cognitive therapy, which focuses on changing unhelpful thinking patterns to improve mental health.

Misinformation

False or inaccurate information that is spread unintentionally.

Transference

In psychoanalysis, the process by which patients transfer feelings they have about figures from their past onto their therapist.

Unconscious Emotions

Feelings that influence an individual's thoughts and actions without their conscious awareness.