Question 1

For EFG Co., the transaction "receipt of a utility bill" would:

Accepted Answer

A)  increase total assets. 
B)  decrease total assets. 
C)  have no effect on total assets. 
D)  decrease total liabilities. 
A)  increase total assets. 
B)  decrease total assets. 
C)  have no effect on total assets. 
D)  decrease total liabilities.

Question 2

​JNC Co.buys equipment for $1,500,000 cash.This transaction:

Accepted Answer

A)  ​decreases JNC Co.'s liquidity and has no effect on its profitability metric. 
B)  ​has no effect on JNC Co.'s liquidity and profitability. 
C)  ​increases JNC Co.'s liquidity and profitability. 
D)  ​has no effect on JNC Co.'s liquidity and decreases its profitability. 
A)  ​decreases JNC Co.'s liquidity and has no effect on its profitability metric. 
B)  ​has no effect on JNC Co.'s liquidity and profitability. 
C)  ​increases JNC Co.'s liquidity and profitability. 
D)  ​has no effect on JNC Co.'s liquidity and decreases its profitability.

Question 3

The payment of utilities expense in cash would affect the operating activities in the statement of cash flows and the income statement but not the balance sheet.

Accepted Answer

A) True 
 B)False

Question 4

The income statement for August indicates net income of $100,000.The corporation also paid $25,000 in dividends during the same period.If the company is in operation for only one month and has no beginning balance in retained earnings, what is the ending balance in retained earnings?

Accepted Answer

A)  $75,000 
B)  $100,000 
C)  $20,000 
D)  $125,000 
A)  $75,000 
B)  $100,000 
C)  $20,000 
D)  $125,000

Question 5

The statement of cash flows is integrated with the balance sheet because:

Accepted Answer

A)  the cash at the beginning of the period plus or minus the cash flows from operating, investing, and financing activities equals the end of period cash reported on the balance sheet. 
B)  the cash at the beginning of the period plus or minus the net income equals the end of period cash reported on the balance sheet. 
C)  the cash at the beginning of the period plus or minus assets and liabilities equals the end of period cash reported on the balance sheet. 
D)  the cash at the beginning of the period plus or minus the cash flows from operating activities equals the end of period cash reported on the balance sheet. 
A)  the cash at the beginning of the period plus or minus the cash flows from operating, investing, and financing activities equals the end of period cash reported on the balance sheet. 
B)  the cash at the beginning of the period plus or minus the net income equals the end of period cash reported on the balance sheet. 
C)  the cash at the beginning of the period plus or minus assets and liabilities equals the end of period cash reported on the balance sheet. 
D)  the cash at the beginning of the period plus or minus the cash flows from operating activities equals the end of period cash reported on the balance sheet.

Question 6

For EFG Co., the transaction "payment of quarterly taxes" would:

Accepted Answer

A)  increase total assets. 
B)  decrease total assets. 
C)  have no effect on total assets. 
D)  increase stockholders' equity. 
A)  increase total assets. 
B)  decrease total assets. 
C)  have no effect on total assets. 
D)  increase stockholders' equity.

Question 7

If a $15,000 purchase of equipment for cash is incorrectly recorded as an increase to equipment and as an increase to cash, at the end of the period assets will:

Accepted Answer

A)  exceed liabilities and stockholders' equity by $15,000. 
B)  equal liabilities and stockholders' equity. 
C)  exceed liabilities and stockholders' equity by $30,000. 
D)  exceed liabilities and stockholders' equity by $40,000. 
A)  exceed liabilities and stockholders' equity by $15,000. 
B)  equal liabilities and stockholders' equity. 
C)  exceed liabilities and stockholders' equity by $30,000. 
D)  exceed liabilities and stockholders' equity by $40,000.

Question 8

If assets have a balance of $80,000 and stockholders' equity has a balance of $60,000, then liabilities must have a balance of:

Accepted Answer

A)  $140,000. 
B)  $60,000. 
C)  $80,000. 
D)  $20,000. 
A)  $140,000. 
B)  $60,000. 
C)  $80,000. 
D)  $20,000.

Question 9

?Blue Ivy Inc.has the following transactions for the month of March: $$\begin{array} { l r } 
\text { Issued common stock } & \$ 60,000 \
\text { Purchased land by paying cash } & \$ 100,000 \
\text { Paid expenses } & \$ 25,000 \
\text { Earned cash fees } & \$ 75,000
\end{array}$$ As a cumulative result of these transactions, the liquidity of Blue Ivy Inc.:

Accepted Answer

A)  ?increases by $75,000. 
B)  ?increases by $10,000. 
C)  ?decreases by $25,000. 
D)  ?decreases by $50,000. 
A)  ?increases by $75,000. 
B)  ?increases by $10,000. 
C)  ?decreases by $25,000. 
D)  ?decreases by $50,000.

Question 10

Yuan Corporation purchased office equipment on account.What is the effect of this transaction?

Accepted Answer

A)  Cash will decrease and office equipment will increase. 
B)  Total assets will increase and shareholders' equity will decrease. 
C)  Total assets and total liabilities will increase. 
D)  Cash flow from financing activities will decrease. 
A)  Cash will decrease and office equipment will increase. 
B)  Total assets will increase and shareholders' equity will decrease. 
C)  Total assets and total liabilities will increase. 
D)  Cash flow from financing activities will decrease.

Question 11

For EFG Co., the transaction "purchase of store equipment with cash" would:

Accepted Answer

A)  increase total assets. 
B)  decrease total assets. 
C)  have no effect on total assets. 
D)  decrease stockholders' equity. 
A)  increase total assets. 
B)  decrease total assets. 
C)  have no effect on total assets. 
D)  decrease stockholders' equity.

Question 12

Sunlight, Inc.had the following assets and liabilities as of September 30, 2016 $$\begin{array} { l l } 
\text { Assets } & \$ 60,600 \
\text { Liabilities } & \$ 27,500
\end{array}$$ If assets increased by $4,350 and equity increased by $2,900 during October, what is the increase or decrease in liabilities of Sunlight as of October 31, 2016?

Accepted Answer

A)  ($1,450) 
B)  $1,450 
C)  $7,250 
D)  ($7,250) 
A)  ($1,450) 
B)  $1,450 
C)  $7,250 
D)  ($7,250)

Question 13

Glocal Inc.has retained earnings of $60,000, common stock of $110,000, and liabilities of $35,000.The total assets of the company are worth:

Accepted Answer

A)  $205,000 
B)  $145,000 
C)  $95,000 
D)  $170,000 
A)  $205,000 
B)  $145,000 
C)  $95,000 
D)  $170,000

Question 14

Blue Inc.has the following transactions for the month of April: $$\begin{array} { l r } 
\text { Fees earned in cash } & \$ 640,000 \
\text { Expenses paid } & \$ 300,000 \
\text { Dividends paid } & \$ 50,000
\end{array}$$ ?As a result of these transactions, Blue Inc.'s profitability metric:?

Accepted Answer

A)  increases by $340,000.? 
B)  ?decreases by $300,000. 
C)  ?increases by $290,000. 
D)  ?decreases by $640,000. 
A)  increases by $340,000.? 
B)  ?decreases by $300,000. 
C)  ?increases by $290,000. 
D)  ?decreases by $640,000.

Question 15

A _____ is an economic event that under generally accepted accounting principles affects an element of the financial statements and must be recorded.

Accepted Answer

A)  framework 
B)  control 
C)  set of rules 
D)  transaction 
A)  framework 
B)  control 
C)  set of rules 
D)  transaction

Question 16

The payment of a liability:

Accepted Answer

A)  decreases assets and stockholders' equity. 
B)  increases assets and decreases liabilities. 
C)  decreases assets and increases liabilities. 
D)  decreases assets and decreases liabilities. 
A)  decreases assets and stockholders' equity. 
B)  increases assets and decreases liabilities. 
C)  decreases assets and increases liabilities. 
D)  decreases assets and decreases liabilities.

Question 17

A to Z Corporation purchased a building for $80,000 cash.On the Statement of Cash Flows, the transaction would be classified as:

Accepted Answer

A)  Cash Flows from Operating Activities. 
B)  Cash Flows from Investing Activities. 
C)  Cash Flows from Financing Activities. 
D)  Noncash transaction. 
A)  Cash Flows from Operating Activities. 
B)  Cash Flows from Investing Activities. 
C)  Cash Flows from Financing Activities. 
D)  Noncash transaction.

Question 18

For EFG Co., the transaction "payment of interest expense" would:

Accepted Answer

A)  increase total assets. 
B)  decrease total assets. 
C)  have no effect on total assets. 
D)  increase stockholders' equity. 
A)  increase total assets. 
B)  decrease total assets. 
C)  have no effect on total assets. 
D)  increase stockholders' equity.

Question 19

The integrated financial statement approach has built-in controls to ensure that all transactions are correctly analyzed, recorded, and summarized.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following statements is true about liabilities?

Accepted Answer

A)  Liabilities include insurance premium paid in advance. 
B)  Liabilities arise when a company sells goods on account. 
C)  Liabilities equal assets plus stockholders' equity. 
D)  Liabilities are the debt owed by a company. 
A)  Liabilities include insurance premium paid in advance. 
B)  Liabilities arise when a company sells goods on account. 
C)  Liabilities equal assets plus stockholders' equity. 
D)  Liabilities are the debt owed by a company.

For EFG Co., the transaction "receipt of a utility bill" would:

JNC Co.buys equipment for $1,500,000 cash.This transaction:

The payment of utilities expense in cash would affect the operating activities in the statement of cash flows and the income statement but not the balance sheet.

The income statement for August indicates net income of $100,000.The corporation also paid $25,000 in dividends during the same period.If the company is in operation for only one month and has no beginning balance in retained earnings, what is the ending balance in retained earnings?

The statement of cash flows is integrated with the balance sheet because:

For EFG Co., the transaction "payment of quarterly taxes" would:

If a $15,000 purchase of equipment for cash is incorrectly recorded as an increase to equipment and as an increase to cash, at the end of the period assets will:

If assets have a balance of $80,000 and stockholders' equity has a balance of $60,000, then liabilities must have a balance of:

?Blue Ivy Inc.has the following transactions for the month of March: Issued common stock \ 60,000 Purchased land by paying cash \ 100,000 Paid expenses \ 25,000 Earned cash fees \ 75,000 As a cumulative result of these transactions, the liquidity of Blue Ivy Inc.:

Yuan Corporation purchased office equipment on account.What is the effect of this transaction?

For EFG Co., the transaction "purchase of store equipment with cash" would:

Sunlight, Inc.had the following assets and liabilities as of September 30, 2016 Assets \ 60,600 Liabilities \ 27,500 If assets increased by $4,350 and equity increased by $2,900 during October, what is the increase or decrease in liabilities of Sunlight as of October 31, 2016?

Glocal Inc.has retained earnings of $60,000, common stock of $110,000, and liabilities of $35,000.The total assets of the company are worth:

Blue Inc.has the following transactions for the month of April: Fees earned in cash \ 640,000 Expenses paid \ 300,000 Dividends paid \ 50,000 ?As a result of these transactions, Blue Inc.'s profitability metric:?

A _____ is an economic event that under generally accepted accounting principles affects an element of the financial statements and must be recorded.

The payment of a liability:

A to Z Corporation purchased a building for $80,000 cash.On the Statement of Cash Flows, the transaction would be classified as:

For EFG Co., the transaction "payment of interest expense" would:

The integrated financial statement approach has built-in controls to ensure that all transactions are correctly analyzed, recorded, and summarized.

Which of the following statements is true about liabilities?

The Role of Accounting in Business

Basic Accounting Systems: Accrual Basis

Accounting for Merchandising Businesses

Internal Control and Cash

Receivables and Inventories

Fixed Assets, Natural Resources, and Intangible Assets

Liabilities and Stockholders Equity

Metric Analysis of Financial Statements

Accounting for Manufacturing Operations

Cost-Volume-Profit Analysis

Differential Analysis and Product Pricing

Budgeting and Standard Costs

Performance Evaluation for Decentralized Operations

Capital Investment Analysis

Filters

Exam 2: Basic Accounting Systems: Cash Basis

For EFG Co., the transaction "receipt of a utility bill" would:

​JNC Co.buys equipment for $1,500,000 cash.This transaction:

The payment of utilities expense in cash would affect the operating activities in the statement of cash flows and the income statement but not the balance sheet.

The income statement for August indicates net income of $100,000.The corporation also paid $25,000 in dividends during the same period.If the company is in operation for only one month and has no beginning balance in retained earnings, what is the ending balance in retained earnings?

The statement of cash flows is integrated with the balance sheet because:

For EFG Co., the transaction "payment of quarterly taxes" would:

If a $15,000 purchase of equipment for cash is incorrectly recorded as an increase to equipment and as an increase to cash, at the end of the period assets will:

If assets have a balance of $80,000 and stockholders' equity has a balance of $60,000, then liabilities must have a balance of:

?Blue Ivy Inc.has the following transactions for the month of March: Issued common stock \ 60,000 Purchased land by paying cash \ 100,000 Paid expenses \ 25,000 Earned cash fees \ 75,000 As a cumulative result of these transactions, the liquidity of Blue Ivy Inc.:

Yuan Corporation purchased office equipment on account.What is the effect of this transaction?

For EFG Co., the transaction "purchase of store equipment with cash" would:

Sunlight, Inc.had the following assets and liabilities as of September 30, 2016 Assets \ 60,600 Liabilities \ 27,500 If assets increased by $4,350 and equity increased by $2,900 during October, what is the increase or decrease in liabilities of Sunlight as of October 31, 2016?

Glocal Inc.has retained earnings of $60,000, common stock of $110,000, and liabilities of $35,000.The total assets of the company are worth:

Blue Inc.has the following transactions for the month of April: Fees earned in cash \ 640,000 Expenses paid \ 300,000 Dividends paid \ 50,000 ?As a result of these transactions, Blue Inc.'s profitability metric:?

A _____ is an economic event that under generally accepted accounting principles affects an element of the financial statements and must be recorded.

The payment of a liability:

A to Z Corporation purchased a building for $80,000 cash.On the Statement of Cash Flows, the transaction would be classified as:

For EFG Co., the transaction "payment of interest expense" would:

The integrated financial statement approach has built-in controls to ensure that all transactions are correctly analyzed, recorded, and summarized.

Which of the following statements is true about liabilities?

The Role of Accounting in Business

Basic Accounting Systems: Accrual Basis

Accounting for Merchandising Businesses

Internal Control and Cash

Receivables and Inventories

Fixed Assets, Natural Resources, and Intangible Assets

Liabilities and Stockholders Equity

Metric Analysis of Financial Statements

Accounting for Manufacturing Operations

Cost-Volume-Profit Analysis

Differential Analysis and Product Pricing

Budgeting and Standard Costs

Performance Evaluation for Decentralized Operations

Capital Investment Analysis

Filters

JNC Co.buys equipment for $1,500,000 cash.This transaction: