Spirit Company, a Merchandiser, Recently Completed Its 2010 Calendar Year

question 137

Multiple Choice

Spirit Company, a merchandiser, recently completed its 2010 calendar year. For the year, (1) all sales are credit sales, (2) all credits to Accounts Receivable reflect cash receipts from customers, (3) all purchases of inventory are on credit, (4) all debits to Accounts Payable reflect cash payments for inventory, and (5) Other Expenses are paid in advance and are initially debited to Prepaid Expenses. The company's balance sheet and income statement follow:

Additional Information on Year 2010 Transactions

What is the amount of dividends declared and distributed in 2010?

• A) $180,350
• B) $8,375
• C) $61,875
• D) $56,600
• E) $70,250

---

Definitions:

Ordinal

Pertaining to a type of data or scale that expresses order or ranking among categories without implying precise measurements.

Friedman Test

A non-parametric statistical test for comparing more than two related groups, assessing differences across multiple test attempts.

Rejection Region

In statistical hypothesis testing, it is the range of values for which the null hypothesis is considered improbable enough to be rejected.

Significance Level

The threshold below which a null hypothesis is rejected in a statistical test, often denoted by alpha (α) and commonly set at 0.05 or 5%.