ACC 100 - Chapter 9 Exam Questions with Verified Solutions (Graded A+)
basic earnings per share (p. 335) - Answers Net income available to common stockholders divided by the weighted-average number of shares of common stock outstanding during the period.
cost of goods sold (p. 329) - Answers Cost...
basic earnings per share (p. 335) - Answers Net income available to common stockholders divided by the
weighted-average number of shares of common stock outstanding during the period.
cost of goods sold (p. 329) - Answers Cost of merchandise sold during the period; an expense deducted
from net sales to arrive at gross profit.
page 350 cost of goods sold model (p. 330) - Answers The formula for calculating cost of goods sold by
adding beginning inventory and purchases and subtracting ending inventory.
diluted earnings per share (p. 335) - Answers An amount less than basic earnings per share that assumes
that additional shares of common stock have been issued pursuant to convertible debt, convertible
preferred stock, and/or stock option plans.
dilution (p. 337) - Answers The reduction in earnings per share of common stock (EPS) that may occur if
convertible securities are actually converted to common stock and/or if additional shares of common
stock are issued pursuant to a stock option plan.
earned (p. 324) - Answers A revenue recognition criterion that relates to completion of the revenue-
generating activity.
expenses (p. 328) - Answers Outflows or other using up of assets or incurrences of liabilities during a
period from delivering or producing goods, rendering services, or carrying out other activities that
constitute the entity's major operations.
extraordinary item (p. 340) - Answers A gain or loss from a transaction that both was unusual in nature
and occurred infrequently; prior to 2015, it was reported separately in the income statement and shown
net of taxes. (Some companies may continue to report the comparative effects of extraordinary items
that occurred in prior years.)
FOB destination (p. 327) - Answers The shipping term that means that title passes from seller to buyer
when the merchandise arrives at its destination.
FOB shipping point (p. 327) - Answers The shipping term that means that title passes from seller to
buyer when the merchandise leaves the seller's premises.
freight collect (p. 327) - Answers A freight payment alternative meaning that freight is payable when the
merchandise arrives at its destination.
freight prepaid (p. 327) - Answers A freight payment alternative meaning that freight is paid by the
shipper.
gains (p. 327) - Answers Increases in net assets from incidental transactions and other events affecting
an entity during a period except those that result from revenues or investments by owners.
gross margin (p. 331) - Answers Another term for gross profit.
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