Question 1

Which of the following is true regarding the corporate form of business organization?

Accepted Answer

A) Corporations are the most prevalent form of business organization. 
B) Corporate businesses are generally smaller in size than partnerships and proprietor-ships. 
C) The revenues of corporations are greater than the combined revenues of partnerships and proprietorships. 
D) Corporations are separate legal entities organized exclusively under federal law. 
A) Corporations are the most prevalent form of business organization. 
B) Corporate businesses are generally smaller in size than partnerships and proprietor-ships. 
C) The revenues of corporations are greater than the combined revenues of partnerships and proprietorships. 
D) Corporations are separate legal entities organized exclusively under federal law.

Question 2

Misra Company compiled the following financial information as of December 31, 2015:   Misra's stockholders' equity on December 31, 2015 is

Accepted Answer

A) $90,000. 
B) $140,000. 
C) $210,000. 
D) $250,000. 
A) $90,000. 
B) $140,000. 
C) $210,000. 
D) $250,000.

Question 3

The study of accounting is not useful for a business career unless your career objective is to become an accountant.

Accepted Answer

A) True 
 B)False

Question 4

Financial accounting provides economic and financial information for all of the following except

Accepted Answer

A) creditors. 
B) investors. 
C) managers. 
D) other external users. 
A) creditors. 
B) investors. 
C) managers. 
D) other external users.

Question 5

Bookkeeping and accounting are one and the same because the bookkeeping function includes the accounting process.

Accepted Answer

A) True 
 B)False

Question 6

A balance sheet reports the assets and liabilities of a company for a specific period of time.

Accepted Answer

A) True 
 B)False

Question 7

All of the following statements are correct except

Accepted Answer

A) Good decision-making depends on good information. 
B) A vital element in communicating economic events is the accountant's ability to analyze and interpret reported information. 
C) The origins of accounting are generally attributed to Socrates, a classical Greek philosopher, who promoted accounting as a social contract. 
D) The information that a user of financial information needs depends upon the kinds of decisions the user makes. 
A) Good decision-making depends on good information. 
B) A vital element in communicating economic events is the accountant's ability to analyze and interpret reported information. 
C) The origins of accounting are generally attributed to Socrates, a classical Greek philosopher, who promoted accounting as a social contract. 
D) The information that a user of financial information needs depends upon the kinds of decisions the user makes.

Question 8

The fair value principle is applied for

Accepted Answer

A) all assets. 
B) current assets. 
C) buildings. 
D) investment securities. 
A) all assets. 
B) current assets. 
C) buildings. 
D) investment securities.

Question 9

Andre Dickinson, owner of Andre's Fine Wines, also owns a personal residence that costs $475,000. The market value of his residence is $625,000. During preparation of the financial statements for Andre's Fine Wines, the accounting concept most relevant to the presentation of Andre's home is

Accepted Answer

A) the economic entity assumption. 
B) the fair value principle. 
C) the monetary unit assumption. 
D) convergence. 
A) the economic entity assumption. 
B) the fair value principle. 
C) the monetary unit assumption. 
D) convergence.

Question 10

If total liabilities decreased by $30,000 and stockholders' equity decreased by $20,000 during a period of time, then total assets must change by what amount and direction during that same period?

Accepted Answer

A) $50,000 decrease 
B) $10,000 decrease 
C) $10,000 increase 
D) $50,000 increase 
A) $50,000 decrease 
B) $10,000 decrease 
C) $10,000 increase 
D) $50,000 increase

Question 11

At October 1, Arcade Fire Enterprises reported stockholders' equity of $70,000. During October, common stock of $4,000 was issued and the company earned net income of $14,000. If stockholders' equity at October 31 totals $80,000, what amount of dividends were paid during the month?

Accepted Answer

A) $0 
B) $4,000 
C) $8,000 
D) $10,000 
A) $0 
B) $4,000 
C) $8,000 
D) $10,000

Question 12

A working knowledge of accounting is not relevant to a lawyer or an architect.

Accepted Answer

A) True 
 B)False

Question 13

The body of theory underlying accounting is not based on

Accepted Answer

A) physical laws of nature. 
B) concepts. 
C) principles. 
D) definitions. 
A) physical laws of nature. 
B) concepts. 
C) principles. 
D) definitions.

Question 14

If total liabilities decreased by $30,000 and stockholders' equity increased by $20,000 during a period of time, then total assets must change by what amount and direction during that same period?

Accepted Answer

A) $50,000 decrease 
B) $10,000 decrease 
C) $10,000 increase 
D) $50,000 increase 
A) $50,000 decrease 
B) $10,000 decrease 
C) $10,000 increase 
D) $50,000 increase

Question 15

Which of the following is not part of the accounting process?

Accepted Answer

A) Recording 
B) Identifying 
C) Financial decision making 
D) Communicating 
A) Recording 
B) Identifying 
C) Financial decision making 
D) Communicating

Question 16

If total liabilities increased by $25,000 during a period of time and stockholders' equity decreased by $9,000 during the same period, then the amount and direction (increase or decrease) of the period's change in total assets is a(n)

Accepted Answer

A) $34,000 decrease. 
B) $16,000 decrease. 
C) $16,000 increase. 
D) $34,000 increase. 
A) $34,000 decrease. 
B) $16,000 decrease. 
C) $16,000 increase. 
D) $34,000 increase.

Question 17

Which of the following would not be considered internal users of accounting data for a company?

Accepted Answer

A) The president of a company. 
B) The controller of a company. 
C) Creditors of a company. 
D) Salesmen of the company. 
A) The president of a company. 
B) The controller of a company. 
C) Creditors of a company. 
D) Salesmen of the company.

Question 18

U.S. standards are developed by the

Accepted Answer

A) IFRS. 
B) GAAP. 
C) IASB. 
D) FASB. 
A) IFRS. 
B) GAAP. 
C) IASB. 
D) FASB.

Question 19

Owners enjoy limited liability in a

Accepted Answer

A) proprietorship. 
B) partnership. 
C) corporation. 
D) sole proprietorship. 
A) proprietorship. 
B) partnership. 
C) corporation. 
D) sole proprietorship.

Question 20

Teamboo Company's stockholders' equity at the beginning of August 2015 was $750,000. During the month, the company earned net income of $175,000 and paid dividends of $75,000. At the end of August 2015, what is the amount of stockholders' equity?

Accepted Answer

A) $675,000 
B) $750,000 
C) $825,000 
D) $850,000 
A) $675,000 
B) $750,000 
C) $825,000 
D) $850,000

Which of the following is true regarding the corporate form of business organization?

Misra Company compiled the following financial information as of December 31, 2015: Misra's stockholders' equity on December 31, 2015 is

The study of accounting is not useful for a business career unless your career objective is to become an accountant.

Financial accounting provides economic and financial information for all of the following except

Bookkeeping and accounting are one and the same because the bookkeeping function includes the accounting process.

A balance sheet reports the assets and liabilities of a company for a specific period of time.

All of the following statements are correct except

The fair value principle is applied for

Andre Dickinson, owner of Andre's Fine Wines, also owns a personal residence that costs $475,000. The market value of his residence is $625,000. During preparation of the financial statements for Andre's Fine Wines, the accounting concept most relevant to the presentation of Andre's home is

If total liabilities decreased by $30,000 and stockholders' equity decreased by $20,000 during a period of time, then total assets must change by what amount and direction during that same period?

At October 1, Arcade Fire Enterprises reported stockholders' equity of $70,000. During October, common stock of $4,000 was issued and the company earned net income of $14,000. If stockholders' equity at October 31 totals $80,000, what amount of dividends were paid during the month?

A working knowledge of accounting is not relevant to a lawyer or an architect.

The body of theory underlying accounting is not based on

If total liabilities decreased by $30,000 and stockholders' equity increased by $20,000 during a period of time, then total assets must change by what amount and direction during that same period?

Which of the following is not part of the accounting process?

If total liabilities increased by $25,000 during a period of time and stockholders' equity decreased by $9,000 during the same period, then the amount and direction (increase or decrease) of the period's change in total assets is a(n)

Which of the following would not be considered internal users of accounting data for a company?

U.S. standards are developed by the

Owners enjoy limited liability in a

Teamboo Company's stockholders' equity at the beginning of August 2015 was $750,000. During the month, the company earned net income of $175,000 and paid dividends of $75,000. At the end of August 2015, what is the amount of stockholders' equity?

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Stock Transactions, Dividends, and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

Filters

Exam 1: Accounting in Action

Which of the following is true regarding the corporate form of business organization?

Misra Company compiled the following financial information as of December 31, 2015: Misra's stockholders' equity on December 31, 2015 is

The study of accounting is not useful for a business career unless your career objective is to become an accountant.

Financial accounting provides economic and financial information for all of the following except

Bookkeeping and accounting are one and the same because the bookkeeping function includes the accounting process.

A balance sheet reports the assets and liabilities of a company for a specific period of time.

All of the following statements are correct except

The fair value principle is applied for

Andre Dickinson, owner of Andre's Fine Wines, also owns a personal residence that costs $475,000. The market value of his residence is $625,000. During preparation of the financial statements for Andre's Fine Wines, the accounting concept most relevant to the presentation of Andre's home is

If total liabilities decreased by $30,000 and stockholders' equity decreased by $20,000 during a period of time, then total assets must change by what amount and direction during that same period?

At October 1, Arcade Fire Enterprises reported stockholders' equity of $70,000. During October, common stock of $4,000 was issued and the company earned net income of $14,000. If stockholders' equity at October 31 totals $80,000, what amount of dividends were paid during the month?

A working knowledge of accounting is not relevant to a lawyer or an architect.

The body of theory underlying accounting is not based on

If total liabilities decreased by $30,000 and stockholders' equity increased by $20,000 during a period of time, then total assets must change by what amount and direction during that same period?

Which of the following is not part of the accounting process?

If total liabilities increased by $25,000 during a period of time and stockholders' equity decreased by $9,000 during the same period, then the amount and direction (increase or decrease) of the period's change in total assets is a(n)

Which of the following would not be considered internal users of accounting data for a company?

U.S. standards are developed by the

Owners enjoy limited liability in a

Teamboo Company's stockholders' equity at the beginning of August 2015 was $750,000. During the month, the company earned net income of $175,000 and paid dividends of $75,000. At the end of August 2015, what is the amount of stockholders' equity?

The Recording Process

Adjusting the Accounts

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories

Fraud, Internal Control, and Cash

Accounting for Receivables

Plant Assets, Natural Resources, and Intangible Assets

Liabilities

Corporations: Organization, Stock Transactions, Dividends, and Retained Earnings

Investments

Statement of Cash Flows

Financial Statement Analysis

Filters