Reference no: EM132777062
Marcos Company reported the following items on its financial statements for the year ending December 31, 2017:
Sales $560,000 Cost of goods sold $410,000
Salary expense 40,000 Interest expense 30,000
Dividends 20,000 Income tax expense 25,000
Problem 1: How much will be reported as net income on Marcos' income statement at December 31, 2017, if this is the first year of operations?
a. $85,000
b. $55,000
c. $65,000
d. Not enough information is provided.
Problem 2: Which of the following would be classified as external users of financial statements?
a. The creditors and stockholders of the company
b. The controller of the company and a company's stockholders
c. Stockholders and management of the company
d. The company's marketing managers
Problem 3: Which one of the following groups is considered an internal user of financial statements?
a. The financial analysts for a brokerage firm who are preparing recommendations for the firm's brokers on compa industry
b. A bank reviewing a loan application from a corporation
c. The labor union representing employees of a company that is involved in labor negotiations
d. Factory managers who supervise production line workers
Problem 4: Which of the following is the correct date format for the financial statement heading?
a. Statement of retained earnings at December 31, 2017
b. Balance sheet at December 31, 2017
c. Balance sheet for the year ended June 30, 2017
d. Income statement at December 31, 2017