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c. debit to Treasury Stock for $25,000. d. credit to Common Stock for
$21,000.

13. The purchase of treasury stock
decreases total stockholders' equity.
increases total stockholders' equity.
increases total stockholders' equity.
decreases total stockholders' equity.

a.
b.
c.
d.

increases
decreases
increases
decreases

total
total
total
total

assets
assets
assets
assets

and
and
and
and

14. Ross Paints reported sales of $350,000, total assets of $150,000,
total stock-holders' equity of $60,000, current assets of $50,000,
current liabilities of $30,000, and cash of $15,000. In a vertical
analysis of the balance sheet, cash would be shown as a. 25%. b. 10%.
c. 30%. d. 20%.

15. Common size analysis is one technique of a. ratio analysis. b.
horizontal analysis. c. liquidity analysis. d. vertical analysis.

16. Swanson Company had inventory of $220,000 and $180,000 on
December 31, 2007, and December 31, 2006, respectively. Cost of
goods sold for 2007 was $1,520,000. Average days in inventory is
approximately a. 52.9. b. 7.6. c. 48. d. 6.9.

17. If common stock is issued for an amount greater than par value,
the excess should be credited to a. Cash. b. Retained Earnings. c.
Paid-in Capital in Excess of Par Value. d. Legal Capital.