Question 1

The economic entity assumption states that a company will remain in operations for the foreseeable future.

Accepted Answer

A) True 
 B)False

Question 2

During January 2022 Carey Services Inc.paid a cash dividend of $2000.This transaction

Accepted Answer

A) reduces stockholders' equity by $2000. 
B) increases stockholders' equity by $2000. 
C) reduces net income by $2000. 
D) increases expenses by $2000. 
A) reduces stockholders' equity by $2000. 
B) increases stockholders' equity by $2000. 
C) reduces net income by $2000. 
D) increases expenses by $2000.

Question 3

During November Kobe Orr invested $300 in a new pet-sitting business Kobe's Cats.During its first month of operations Kobe's Cats performed services and billed customers $750 paid $150 for advertising and collected $500 from customers.Enter these transactions into Kobe's Cats' tabular analysis to determine which of the following statements is true at the end of the month:

Accepted Answer

A) The company has assets of $900 and stockholder's equity of $900. 
B) The combined effect of the transactions is to increase Cash by $150 Accounts Receivable by $750 and Stockholders' Equity by $900. 
C) Kobe's Cats has net income of $650 for the month of November. 
D) The combined effect of these transactions is to increase Cash $900 increase Accounts Receivable by $250 and increase Revenues by $1050. 
A) The company has assets of $900 and stockholder's equity of $900. 
B) The combined effect of the transactions is to increase Cash by $150 Accounts Receivable by $750 and Stockholders' Equity by $900. 
C) Kobe's Cats has net income of $650 for the month of November. 
D) The combined effect of these transactions is to increase Cash $900 increase Accounts Receivable by $250 and increase Revenues by $1050.

Question 4

Which accounting assumption or principle requires that only those things that can be expressed in dollar values are included in the accounting records?

Accepted Answer

A) monetary unit assumption. 
B) historical cost principle. 
C) periodicity assumption. 
D) full disclosure principle. 
A) monetary unit assumption. 
B) historical cost principle. 
C) periodicity assumption. 
D) full disclosure principle.

Question 5

The convention of consistency refers to consistent use of accounting principles

Accepted Answer

A) among firms. 
B) among economies. 
C) throughout the accounting periods. 
D) within industries. 
A) among firms. 
B) among economies. 
C) throughout the accounting periods. 
D) within industries.

Question 6

Information is _____ if independent parties using the same methods obtain similar results.

Accepted Answer

A) verifiable 
B) consistent 
C) understandable 
D) relevant 
A) verifiable 
B) consistent 
C) understandable 
D) relevant

Question 7

The balance sheet lists current liabilities before stockholders' equity.

Accepted Answer

A) True 
 B)False

Question 8

Crabtree Company's tabular analysis at the beginning of August included the following balances:   How would Crabtree record the payment of the total amounts due to its creditors in the tabular analysis?

Accepted Answer

A) Decrease Cash by $2000 and increase Revenues by $2000. 
B) Decrease Cash by $1500 and decrease Accounts Payable by $1500. 
C) Increase Cash by $2000 and decrease Accounts Receivable by $2000. 
D) Increase Cash by $1500 and decrease Accounts Payable by $1500. 
A) Decrease Cash by $2000 and increase Revenues by $2000. 
B) Decrease Cash by $1500 and decrease Accounts Payable by $1500. 
C) Increase Cash by $2000 and decrease Accounts Receivable by $2000. 
D) Increase Cash by $1500 and decrease Accounts Payable by $1500.

Question 9

Which accounting assumption assumes that an enterprise will continue in operation long enough to carry out its existing objectives and commitments?

Accepted Answer

A) Monetary unit assumption 
B) Economic entity assumption 
C) Periodicity assumption 
D) Going concern assumption 
A) Monetary unit assumption 
B) Economic entity assumption 
C) Periodicity assumption 
D) Going concern assumption

Question 10

GAAP stands for generally accepted accounting procedures.

Accepted Answer

A) True 
 B)False

Question 11

The sale of an asset on credit for what it cost

Accepted Answer

A) increases assets and liabilities. 
B) decreases assets and liabilities. 
C) leaves total assets unchanged. 
D) decreases assets and increases liabilities. 
A) increases assets and liabilities. 
B) decreases assets and liabilities. 
C) leaves total assets unchanged. 
D) decreases assets and increases liabilities.

Question 12

Cash received in advance of providing a service affects both Cash and Stockholders' Equity.

Accepted Answer

A) True 
 B)False

Question 13

The accounting concept that indicates assets should be reported at the price received to sell the asset at the reporting date is the

Accepted Answer

A) economic entity assumption. 
B) monetary unit assumption. 
C) fair value principle. 
D) historical cost principle. 
A) economic entity assumption. 
B) monetary unit assumption. 
C) fair value principle. 
D) historical cost principle.

Question 14

Generally accepted accounting principles are rules and practices that are recognized as a general guide for financial reporting purposes.

Accepted Answer

A) True 
 B)False

Question 15

AMB Company's tabular analysis at the beginning of October consisted of the following balances:   During October the company issued additional shares of stock for proceeds of $2000.After recording this transaction in the tabular analysis the company would report:

Accepted Answer

A) Assets $12000 = Liabilities $3000 + Stockholders' Equity $9000 
B) Assets $9500 = Liabilities $3000 + Stockholders' Equity $6500 
C) Assets $10000 = Liabilities $3000 + Stockholders' Equity $9000 
D) Assets $8000 = Liabilities $3000 + Stockholders' Equity $5000 
A) Assets $12000 = Liabilities $3000 + Stockholders' Equity $9000 
B) Assets $9500 = Liabilities $3000 + Stockholders' Equity $6500 
C) Assets $10000 = Liabilities $3000 + Stockholders' Equity $9000 
D) Assets $8000 = Liabilities $3000 + Stockholders' Equity $5000

Question 16

When expenses exceed revenues a net loss results.

Accepted Answer

A) True 
 B)False

Question 17

The historical cost principle requires that when assets are acquired they are recorded at

Accepted Answer

A) book value. 
B) the amount paid to acquire them. 
C) appraised value. 
D) list price. 
A) book value. 
B) the amount paid to acquire them. 
C) appraised value. 
D) list price.

Question 18

At September 1 2022 Kern Enterprises reported a cash balance of $140000.During the month Kern collected cash of $60000 and made disbursements of $100000.At September 30 2022 the cash balance is

Accepted Answer

A) $40000 
B) $180000 
C) $200000 
D) $100000 
A) $40000 
B) $180000 
C) $200000 
D) $100000

Question 19

AMB Company's tabular analysis at the beginning of October consisted of the following balances:   During October the company issued additional shares of stock for proceeds of $2000.How would this transaction be recorded in the tabular analysis?

Accepted Answer

A) Decrease Cash by $2000 and increase Revenue by $2000. 
B) Increase Accounts Receivable by $2000 and increase Revenue by $2000. 
C) Increase Cash by $2000 and decrease Common Stock by $2000. 
D) Increase Cash by $2000 and increase Common Stock by $2000. 
A) Decrease Cash by $2000 and increase Revenue by $2000. 
B) Increase Accounts Receivable by $2000 and increase Revenue by $2000. 
C) Increase Cash by $2000 and decrease Common Stock by $2000. 
D) Increase Cash by $2000 and increase Common Stock by $2000.

Question 20

An investment by the stockholders in a business increases

Accepted Answer

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

The economic entity assumption states that a company will remain in operations for the foreseeable future.

During January 2022 Carey Services Inc.paid a cash dividend of $2000.This transaction

Which accounting assumption or principle requires that only those things that can be expressed in dollar values are included in the accounting records?

The convention of consistency refers to consistent use of accounting principles

Information is _____ if independent parties using the same methods obtain similar results.

The balance sheet lists current liabilities before stockholders' equity.

Crabtree Company's tabular analysis at the beginning of August included the following balances: How would Crabtree record the payment of the total amounts due to its creditors in the tabular analysis?

Which accounting assumption assumes that an enterprise will continue in operation long enough to carry out its existing objectives and commitments?

GAAP stands for generally accepted accounting procedures.

The sale of an asset on credit for what it cost

Cash received in advance of providing a service affects both Cash and Stockholders' Equity.

The accounting concept that indicates assets should be reported at the price received to sell the asset at the reporting date is the

Generally accepted accounting principles are rules and practices that are recognized as a general guide for financial reporting purposes.

AMB Company's tabular analysis at the beginning of October consisted of the following balances: During October the company issued additional shares of stock for proceeds of $2000.After recording this transaction in the tabular analysis the company would report:

When expenses exceed revenues a net loss results.

The historical cost principle requires that when assets are acquired they are recorded at

At September 1 2022 Kern Enterprises reported a cash balance of $140000.During the month Kern collected cash of $60000 and made disbursements of $100000.At September 30 2022 the cash balance is

AMB Company's tabular analysis at the beginning of October consisted of the following balances: During October the company issued additional shares of stock for proceeds of $2000.How would this transaction be recorded in the tabular analysis?

An investment by the stockholders in a business increases

Introduction to Financial Statements

A Further Look at Financial Statements

Accrual Accounting Concepts

Fraud, Internal Control, and Cash

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities and Stockholders Equity

Financial Analysis: the Big Picture

Managerial Accounting

Cost-Volume-Profit

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Planning for Capital Investments

Activity Based Costing

Cost-Volume Profit Analysis: Additional Issues

Filters

Exam 3: The Accounting Information System

The economic entity assumption states that a company will remain in operations for the foreseeable future.

During January 2022 Carey Services Inc.paid a cash dividend of $2000.This transaction

Which accounting assumption or principle requires that only those things that can be expressed in dollar values are included in the accounting records?

The convention of consistency refers to consistent use of accounting principles

Information is _____ if independent parties using the same methods obtain similar results.

The balance sheet lists current liabilities before stockholders' equity.

Crabtree Company's tabular analysis at the beginning of August included the following balances: How would Crabtree record the payment of the total amounts due to its creditors in the tabular analysis?

Which accounting assumption assumes that an enterprise will continue in operation long enough to carry out its existing objectives and commitments?

GAAP stands for generally accepted accounting procedures.

The sale of an asset on credit for what it cost

Cash received in advance of providing a service affects both Cash and Stockholders' Equity.

The accounting concept that indicates assets should be reported at the price received to sell the asset at the reporting date is the

Generally accepted accounting principles are rules and practices that are recognized as a general guide for financial reporting purposes.

AMB Company's tabular analysis at the beginning of October consisted of the following balances: During October the company issued additional shares of stock for proceeds of $2000.After recording this transaction in the tabular analysis the company would report:

When expenses exceed revenues a net loss results.

The historical cost principle requires that when assets are acquired they are recorded at

At September 1 2022 Kern Enterprises reported a cash balance of $140000.During the month Kern collected cash of $60000 and made disbursements of $100000.At September 30 2022 the cash balance is

AMB Company's tabular analysis at the beginning of October consisted of the following balances: During October the company issued additional shares of stock for proceeds of $2000.How would this transaction be recorded in the tabular analysis?

An investment by the stockholders in a business increases

Introduction to Financial Statements

A Further Look at Financial Statements

Accrual Accounting Concepts

Fraud, Internal Control, and Cash

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities and Stockholders Equity

Financial Analysis: the Big Picture

Managerial Accounting

Cost-Volume-Profit

Incremental Analysis

Budgetary Planning

Budgetary Control and Responsibility Accounting

Standard Costs and Balanced Scorecard

Planning for Capital Investments

Activity Based Costing

Cost-Volume Profit Analysis: Additional Issues

Filters