55 Profit margin is defined as A Revenues divided by net sal

55. Profit margin is defined as: A. Revenues divided by net sales. B. Net sales divided by assets. C. Net income divided by net sales. D. Net income divided by assets. E. Assets divided by net sales. terms of 2/10, Xopany sold merchandise in the amount of $5,800 to Alberts, with credit Robertson makes on October s isband takes the appropriate discount. The journal entry that 56. On October 1, Robertson merchandise in cost of the items sold is $4,000. Robertson uses the perpetual inventory system. the appropriate Alberts pays the invoice on October 8 Robertson makes on October 8 is: A. Cash 5,800 Accounts Receivable 5,800 B. Cash 4,000 Accounts Receivable 4,000 C. Cash Sales Discounts 80 Accounts Receivable 4,000 D. Cash 5.684 Accounts receivable 5.684 E. Caslh 5,684 116 Sales Discounts Accounts Receivable 5,800 57. Preferred stock on which the right to receive dividends is forfeited for any year that the dividends ar declared is referred to as: A. Participating preferred stock B. Callable preferred stock C. Cumulative preferred stock D. Convertible preferred stock E. Noncumulative preferred stock Xtreme Sports has $100,000 par 8% noncumulative, nonparticipating, preferred stock outstand Xtreme Sports also has $500,000 par common stock outstanding. In the company\'s first year of 8. operation, no dividends were paid. During the second year, Xtreme Sports paid cash dividends S30,000. This dividend should be distributed as follows: A. $8,000 preferred; $22,000 common. B. $16,000 preferred; $14,000 common. C. $7,500 preferred; $22,500 common. D. $15,000 preferred; S15,000 common. E. S0 preferred; $30,000 common.

Solution

As per policy only first four questions will be answered

55. Answer is option C

Profit margin = net income / net sales

56. Answer is option E

Cash Dr (5800-116) 5684

Sales discount Dr. (5800*2%) 116

Accounts receivable cr. 5800

57. Answer is option E

It is Noncumulative preferred stock on which the right to receive a dividend expires whenever the dividend is not declared .

58. Answer is option A

Preferred stock is noncumulative so on preferred stock dividend will be paid for second year only that is (100000*8%) 8000

Remaining will be given to common stock = 30000-8000=22000