Exam 1: Accounting in Action

Which of the following techniques are not used by accountants to interpret and report financial information?

The Constantine Company had the following assets and liabilities on the dates indicated. December 31 Total Assets Total Liabilities 2015 \ 480,000 \ 250,000 2016 \ 460,000 \ 220,000 2017 \ 590,000 \ 300,000 Constantine began business on January 1 2015 with an investment of $100000. Instructions From an analysis of the change in owner's equity during the year compute the net income (or loss) for: (a) 2015 assuming Constantine's drawings were $45000 for the year. (b) 2016 assuming Constantine made an additional investment of $50000 and had no drawings in 2016. (c) 2017 assuming Constantine made an additional investment of $15000 and had drawings of $40000 in 2017.

Below is a list of important abbreviations widely used in business. For each abbreviation give the full designation. 1. $\mathrm { CPA }$$\underline{\quad\quad\quad\quad\quad\quad}$ 2. $\mathrm { IRS}$$\underline{\quad\quad\quad\quad\quad\quad}$ 3. $\mathrm { FBI }$$\underline{\quad\quad\quad\quad\quad\quad}$ 4. $\mathrm { FASB}$$\underline{\quad\quad\quad\quad\quad\quad}$ 5. $\mathrm { GAAP}$$\underline{\quad\quad\quad\quad\quad\quad}$ 6. $\mathrm { SEC}$$\underline{\quad\quad\quad\quad\quad\quad}$

The primary accounting standard-setting body in the United States is the

Analyze the transactions of a business organized as a proprietorship described below and indicate their effect on the basic accounting equation. Use a plus sign (+) to indicate an increase and a minus sign (-) to indicate a decrease.

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

Foxes Service Shop started the year with total assets of $320000 and total liabilities of $240000. During the year the business recorded $630000 in revenues $450000 in expenses and owner drawings of $60000. Owner's equity at the end of the year was

Indicate whether the following items would appear on the balance sheet (BS) income statement (IS) or owner's equity statement (OE). 1. Utilities expense 2. Accounts receivable 3. Owner's drawings 4. Service revenue 5. Salaries and wages payable 6. Equipment

If services are rendered for credit then

The primary purpose of the statement of cash flows is to report

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

The basic accounting equation states that Assets = Liabilities.

Revenues would not result from

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

Sources of increases to owner's equity are

Foxes Service Shop started the year with total assets of $320000 and total liabilities of $240000. During the year the business recorded $630000 in revenues $450000 in expenses and owner drawings of $60000. The net income reported by Foxes Service Shop for the year was

At the beginning of the year Shaolin Company had total assets of $520000 and total liabilities of $210000. Answer the following questions viewing each situation as being independent of the others. (1) If total assets increased $200000 during the year and total liabilities decreased $75000 what is the amount of owner's equity at the end of the year? (2) During the year total liabilities increased $230000 and owner's equity decreased $90000. What is the amount of total assets at the end of the year? (3) If total assets decreased $40000 and owner's equity increased $130000 during the year what is the amount of total liabilities at the end of the year?

At October 1 Flambo Company reported owner's equity of $76000. During October no additional investments were made and the company posted a net loss of $8000. If owner's equity at October 31 totals $64000 what amount of owner drawings were made during the month?

Which of the following events cannot be quantified into dollars and cents and recorded as an accounting transaction?

As of December 31 2016 Cancon Company has assets of $42000 and owner's equity of $22000. What are the liabilities for Cancon Company as of December 31 2016?