Question 1

Management consulting includes examining the financial statements of companies and expressing an opinion as to the fairness of their presentation.

Accepted Answer

A) True 
 B)False

Question 2

At October 1, Arcade Fire Enterprises reported stockholders' equity of $72,000. During October, no stock was issued and the company posted a net loss of $8,000. If stockholders' equity at October 31 totals $64,000, what amount of dividends were paid during the month?

Accepted Answer

A) $0 
B) $4,000 
C) $8,000 
D) $16,000 
A) $0 
B) $4,000 
C) $8,000 
D) $16,000

Question 3

Accountants refer to an economic event as a

Accepted Answer

A) purchase. 
B) sale. 
C) transaction. 
D) change in ownership. 
A) purchase. 
B) sale. 
C) transaction. 
D) change in ownership.

Question 4

The partnership form of business organization

Accepted Answer

A) is a separate legal entity. 
B) is a common form of organization for service-type businesses. 
C) enjoys an unlimited life. 
D) has limited liability. 
A) is a separate legal entity. 
B) is a common form of organization for service-type businesses. 
C) enjoys an unlimited life. 
D) has limited liability.

Question 5

The Financial Accounting Standards Board is a part of the Securities and Exchange Commission.

Accepted Answer

A) True 
 B)False

Question 6

The primary accounting standard-setting body in the United States is the International Accounting Standards Board.

Accepted Answer

A) True 
 B)False

Question 7

A net loss will result during a time period when

Accepted Answer

A) liabilities exceed assets. 
B) dividends exceed investments. 
C) expenses exceed revenues. 
D) revenues exceed expenses. 
A) liabilities exceed assets. 
B) dividends exceed investments. 
C) expenses exceed revenues. 
D) revenues exceed expenses.

Question 8

If total liabilities decreased by $50,000 and stockholders' equity increased by $30,000 during a period of time, then total assets must change by what amount and direction during that same period?

Accepted Answer

A) $80,000 decrease 
B) $20,000 decrease 
C) $20,000 increase 
D) $80,000 increase 
A) $80,000 decrease 
B) $20,000 decrease 
C) $20,000 increase 
D) $80,000 increase

Question 9

Which of the following would not be considered an external user of accounting data for the GHI Company?

Accepted Answer

A) Internal Revenue Service Agent. 
B) Management. 
C) Creditors. 
D) Customers. 
A) Internal Revenue Service Agent. 
B) Management. 
C) Creditors. 
D) Customers.

Question 10

The origins of accounting are generally attributed to the work of

Accepted Answer

A) Christopher Columbus. 
B) Abner Doubleday. 
C) Luca Pacioli. 
D) Leonardo da Vinci. 
A) Christopher Columbus. 
B) Abner Doubleday. 
C) Luca Pacioli. 
D) Leonardo da Vinci.

Question 11

Stahl Consulting started the year with total assets of $60,000 and total liabilities of $15,000. During the year, the business recorded $48,000 in catering revenues and $30,000 in expenses. Stahl issued stock of $9,000 and paid dividends of $15,000 during the year. Stockholders' equity changed by what amount from the beginning of the year to the end of the year?

Accepted Answer

A) $3,000. 
B) $9,000. 
C) $12,000. 
D) $45,000. 
A) $3,000. 
B) $9,000. 
C) $12,000. 
D) $45,000.

Question 12

The purchase of store equipment for cash reduces stockholders' equity by an equal amount.

Accepted Answer

A) True 
 B)False

Question 13

International standards are referred to as

Accepted Answer

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

Question 14

If an individual asset is increased, then

Accepted Answer

A) there must be an equal decrease in a specific liability. 
B) there must be an equal decrease in stockholders' equity. 
C) there must be an equal decrease in another asset. 
D) All of these answers are possible. 
A) there must be an equal decrease in a specific liability. 
B) there must be an equal decrease in stockholders' equity. 
C) there must be an equal decrease in another asset. 
D) All of these answers are possible.

Question 15

Bright Eyes Downtown Diner received a bill of $600 from the Jronand Wine Advertising Agency. The owner, A. A. Bondy, is postponing payment of the bill until a later date. The effect on specific items in the basic accounting equation is

Accepted Answer

A) a decrease in Cash and an increase in Accounts Payable. 
B) a decrease in Cash and an increase in Retained Earnings. 
C) an increase in Accounts Payable and a decrease in Retained Earnings. 
D) a decrease in Accounts Payable and an increase in Retained Earnings. 
A) a decrease in Cash and an increase in Accounts Payable. 
B) a decrease in Cash and an increase in Retained Earnings. 
C) an increase in Accounts Payable and a decrease in Retained Earnings. 
D) a decrease in Accounts Payable and an increase in Retained Earnings.

Question 16

A basic assumption of accounting assumes that the dollar is

Accepted Answer

A) unrelated to business transactions. 
B) a poor measure of economic activities. 
C) the common unit of measure for all business transactions. 
D) useless in measuring an economic event. 
A) unrelated to business transactions. 
B) a poor measure of economic activities. 
C) the common unit of measure for all business transactions. 
D) useless in measuring an economic event.

Question 17

Net income for the period is determined by subtracting total expenses and drawings from total revenues.

Accepted Answer

A) True 
 B)False

Question 18

A private accountant can perform many activities in a business organization but would not work in

Accepted Answer

A) budgeting. 
B) accounting information systems. 
C) external auditing. 
D) tax accounting. 
A) budgeting. 
B) accounting information systems. 
C) external auditing. 
D) tax accounting.

Question 19

The basic accounting equation states that Assets = Liabilities.

Accepted Answer

A) True 
 B)False

Question 20

Keeping a systematic, chronological diary of events that are measured in dollars and cents is called

Accepted Answer

A) communicating. 
B) identifying. 
C) processing. 
D) recording. 
A) communicating. 
B) identifying. 
C) processing. 
D) recording.

Management consulting includes examining the financial statements of companies and expressing an opinion as to the fairness of their presentation.

At October 1, Arcade Fire Enterprises reported stockholders' equity of $72,000. During October, no stock was issued and the company posted a net loss of $8,000. If stockholders' equity at October 31 totals $64,000, what amount of dividends were paid during the month?

Accountants refer to an economic event as a

The partnership form of business organization

The Financial Accounting Standards Board is a part of the Securities and Exchange Commission.

The primary accounting standard-setting body in the United States is the International Accounting Standards Board.

A net loss will result during a time period when

If total liabilities decreased by $50,000 and stockholders' equity increased by $30,000 during a period of time, then total assets must change by what amount and direction during that same period?

Which of the following would not be considered an external user of accounting data for the GHI Company?

The origins of accounting are generally attributed to the work of

The purchase of store equipment for cash reduces stockholders' equity by an equal amount.

International standards are referred to as

If an individual asset is increased, then

Bright Eyes Downtown Diner received a bill of $600 from the Jronand Wine Advertising Agency. The owner, A. A. Bondy, is postponing payment of the bill until a later date. The effect on specific items in the basic accounting equation is

A basic assumption of accounting assumes that the dollar is

Net income for the period is determined by subtracting total expenses and drawings from total revenues.

A private accountant can perform many activities in a business organization but would not work in

The basic accounting equation states that Assets = Liabilities.

Keeping a systematic, chronological diary of events that are measured in dollars and cents is called

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

Management consulting includes examining the financial statements of companies and expressing an opinion as to the fairness of their presentation.

At October 1, Arcade Fire Enterprises reported stockholders' equity of $72,000. During October, no stock was issued and the company posted a net loss of $8,000. If stockholders' equity at October 31 totals $64,000, what amount of dividends were paid during the month?

Accountants refer to an economic event as a

The partnership form of business organization

The Financial Accounting Standards Board is a part of the Securities and Exchange Commission.

The primary accounting standard-setting body in the United States is the International Accounting Standards Board.

A net loss will result during a time period when

If total liabilities decreased by $50,000 and stockholders' equity increased by $30,000 during a period of time, then total assets must change by what amount and direction during that same period?

Which of the following would not be considered an external user of accounting data for the GHI Company?

The origins of accounting are generally attributed to the work of

The purchase of store equipment for cash reduces stockholders' equity by an equal amount.

International standards are referred to as

If an individual asset is increased, then

Bright Eyes Downtown Diner received a bill of $600 from the Jronand Wine Advertising Agency. The owner, A. A. Bondy, is postponing payment of the bill until a later date. The effect on specific items in the basic accounting equation is

A basic assumption of accounting assumes that the dollar is

Net income for the period is determined by subtracting total expenses and drawings from total revenues.

A private accountant can perform many activities in a business organization but would not work in

The basic accounting equation states that Assets = Liabilities.

Keeping a systematic, chronological diary of events that are measured in dollars and cents is called

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