Ending cash balance $ 215,610
References
Multiple Choice Difficulty: 2 Medium Learning Objective: 01-02 Explain the difference between cash
and accrual accounting.
126.
Award: 10.00 points
The following information ($ in millions) comes from a recent annual report of Orinoco.com, Incorporated:
Net sales $ 10,769
Total assets 4,530
End of year balance in cash 1,055
Total stockholders' equity 392
Gross profit (Sales − Cost of Sales) 2,607
Net increase in cash for the year 10
Operating expenses 2,058
Net operating cash flow 766
Other income (expense), net $ (23)
Compute Orinoco's balance in cash at the beginning of the year.
$1,055
$1,864
$1,045
$681
Beginning balance in Cash + Net increase in Cash = Ending balance in Cash
Therefore, beginning balance in Cash = Ending balance in Cash − Net increase in Cash
= $1,055 − $10 = $1,045
References
Multiple Choice Difficulty: 2 Medium Learning Objective: 01-02 Explain the difference between cash
and accrual accounting.
127.
Award: 10.00 points
The following information ($ in millions) comes from a recent annual report of Orinoco.com, Incorporated:
Net sales $ 10,865
Total assets 4,399
End of year balance in cash 1,095
Total stockholders' equity 420
Gross profit (Sales − Cost of Sales) 2,519
Net increase in cash for the year 17
Operating expenses 2,065
Net operating cash flow 788
Other income (expense), net (22)
Compute Orinoco's total liabilities at the end of the year.
$2,303
$3,979
$3,160
$4,399
Total assets = Total liabilities + Total Stockholders' equity
Therefore, Total liabilities = Total assets − Total Stockholders' equity
= $4,399 − $420 = $3,979
References
Multiple Choice Difficulty: 1 Easy Learning Objective: 01-02 Explain the difference between cash
and accrual accounting.
128.
Award: 10.00 points
The following information ($ in millions) comes from a recent annual report of Orinoco.com, Incorporated:
Net sales $ 10,825
Total assets 4,465
End of year balance in cash 1,125
Total stockholders' equity 374
Gross profit (Sales − Cost of Sales) 2,503
Net increase in cash for the year 14
Operating expenses 2,047
Net operating cash flow 788
Other income (expense), net (18)
Compute Orinoco's cost of goods sold for the year.
$8,778
$8,322
$7,300
$5,253
Gross profit = Net sales − Cost of goods sold
Therefore, Cost of goods sold = Net sales − Gross profit
Cost of goods sold = $10,825 − $2,503 = $8,322
References
Multiple Choice Difficulty: 1 Easy Learning Objective: 01-02 Explain the difference between cash
and accrual accounting.
129.
Award: 10.00 points
The following information ($ in millions) comes from a recent annual report of Orinoco.com, Incorporated:
Net sales $ 10,838
Total assets 4,431
End of year balance in cash 1,138
Total stockholders' equity 371
Gross profit (Sales − Cost of Sales) 2,470
Net increase in cash for the year 24
Operating expenses 2,048
Net operating cash flow 617
Other income (expense), net (30)
Compute the income before income tax for Orinoco.
$392
$312
$512
$472
Net income = Gross profit − Operating expenses + Other income (expense), net
= $2,470 − $2,048 + $(30) = $392
References
Multiple Choice Difficulty: 1 Easy Learning Objective: 01-02 Explain the difference between cash
and accrual accounting.
130.
Award: 10.00 points
Listed below are five terms followed by a list of phrases that describe or characterize each of the terms. Match each phrase with the correct number code
for the term.
TERM PHRASE
Term number that matches the
phrase.
1. Predictive value Information is useful in projecting cash flows. ____
2. Relevance Pertinent to the decision at hand. ____
3. Distribution to owners Information is available prior to the decision. ____
4. Confirmatory value Decrease in equity due to transfers to owners. ____
5. Timeliness Information confirms expectations. ____
TERM PHRASE
Term number that matches the
phrase.
1. Predictive value Information is useful in projecting cash flows. 1
2. Relevance Pertinent to the decision at hand. 2
3. Distribution to owners Information is available prior to the decision. 5
4. Confirmatory value Decrease in equity due to transfers to owners. 3