Exam 1: Accounting in Action

Collection of a $1500 Accounts Receivable

Bookkeeping differs from accounting in that bookkeeping primarily involves which part of the accounting process?

In the owner's equity statement revenues are listed first followed by expenses and net income (or net loss).

Match the following external users of financial accounting information with the type of decision that user will make with the information. a. Creditor b. Investor c. Regulatory Agency d Internal Revenue Service $\underline{\quad\quad}$ (1) Is the company operating within prescribed guidelines? $\underline{\quad\quad}$ (2) Is the company complying with tax laws? $\underline{\quad\quad}$ (3) Is the company able to pay its debts? $\underline{\quad\quad}$ (4) Is the company a good investment?

Use the following information to calculate for the year ended December 31 2016 (a) net income (b) ending owner's equity and (c) total assets. Supplies \ 3,000 Revenues \ 25,000 Operating expenses 11,000 Cash 15,000 Accounts payable 9,000 Drawings 1,000 Accounts receivable 3,000 Notes payable 2,000 Beginning Capital 5,000 Equipment 8,000 -Listed below in alphabetical order are the balance sheet items of Middleton Company at December 31 2016. Prepare a balance sheet and include a complete heading. Accounts payable \ 21,000 Accounts receivable 15,000 Buildings 91,000 Cash 6,000 Equipment 17,000 Owner's Capital 108,000

The accounting process is correctly sequenced as

Owner's equity is decreased by

Mirah Company compiled the following financial information as of December 31 2016: Revenues \ 340,000 Owner's Capital (1/1/16) 140,000 Equipment 80,000 Expenses 240,000 Cash 90,000 Owner's Drawings 20,000 Supplies 20,000 Accounts payable 40,000 Accounts receivable 70,000 Mirah's owner's equity on December 31 2016 is

Internal transactions do not affect the basic accounting equation because they are economic events that occur entirely within one company.

If total liabilities decreased by $40000 and owner's equity increased by $30000 during a period of time then total assets must change by what amount and direction during that same period?

A partnership must have more than one owner.

Martha Innocenzi Ito began the Innocenzi Company by investing $75000 of cash in the business. The company recorded revenues of $555000 expenses of $410000 and had owner drawings of $30000. What was Innocenzi's net income for the year?

Which of the following is not a reason one set of international accounting standards are needed?

The basic accounting equation may be expressed as

If total liabilities increased by $9000 during a period of time and owner's equity decreased by $25000 during the same period then the amount and direction (increase or decrease) of the period's change in total assets is a(n)

On June 1 2016 Secretly Canadian Company prepared a balance sheet that shows the following: Assets (no cash) \1 00,000 Liabilities. 45,000 Owner's Equity 55,000 Shortly thereafter all of the assets were sold for cash. How would the balance sheet appear immediately after the sale of the assets for cash for each of the following cases? Cash Received for Balances Immediately After Sale the Assets Assets - Liabilities = Owner's Equity Cash A \ 110,000 underline underline \ Cash B 100,000 Cash C 90,000

The SEC and FASB are two organizations that are primarily responsible for establishing generally accepted accounting principles. It is true that

If an owner makes a withdrawal of cash from a proprietorship then

Balance sheet amounts as of December 31 2016 for K-12 Tutoring Service are listed below. Prepare a balance sheet in good form. Accounts Payable \ 300 Accounts Receivable 1,000 Cash 500 Owner's Capital ?

Alicia Keyes Company began the year with owner's equity of $280000. During the year the company recorded revenues of $375000 expenses of $265000 and had owner drawings of $30000. What was Alicia Keyes' owner's equity at the end of the year?