Question 1

Which one of the following financial statements conveys a relationship of equality between assets and liabilities plus owners' equity?

Accepted Answer

A) income statement 
B) statement of cash flows 
C) balance sheet 
D) statement of retained earnings 
A) income statement 
B) statement of cash flows 
C) balance sheet 
D) statement of retained earnings

Question 2

Which of the following statements is false?

Accepted Answer

A) working capital represents assets needed to carry out the normal?operations of the business. 
B) current liabilities that reflect amounts owed but not yet due on the date?of the balance sheet are called accruals. 
C) because of accrual accounting,a firm's net income over some period?is not necessarily the same as its cash flows. 
D) all the above statements are correct. 
A) working capital represents assets needed to carry out the normal?operations of the business. 
B) current liabilities that reflect amounts owed but not yet due on the date?of the balance sheet are called accruals. 
C) because of accrual accounting,a firm's net income over some period?is not necessarily the same as its cash flows. 
D) all the above statements are correct.

Question 3

A limited liability company (LLC):

Accepted Answer

A) must register with the SEC to sell securities to the public 
B) is an ongoing entity,even if one of the owners leaves 
C) has a limited number of shareholders 
D) all the above 
E) none of the above 
A) must register with the SEC to sell securities to the public 
B) is an ongoing entity,even if one of the owners leaves 
C) has a limited number of shareholders 
D) all the above 
E) none of the above

Question 4

In the statement of cash flows,retained earnings are reported as two separate line items,which are __________ and ___________.

Accepted Answer

A) revenues and expenses 
B) assets and liabilities 
C) depreciation and amortization 
D) net profits and taxes 
E) none of the above 
A) revenues and expenses 
B) assets and liabilities 
C) depreciation and amortization 
D) net profits and taxes 
E) none of the above

Question 5

Agency costs are:

Accepted Answer

A) the costs of hiring managers 
B) assets minus liabilities 
C) common stock price times number of shares outstanding 
D) none of the above 
A) the costs of hiring managers 
B) assets minus liabilities 
C) common stock price times number of shares outstanding 
D) none of the above

Question 6

All of the following accounts are considered to be current liabilities on the balance sheet except:

Accepted Answer

A) accounts receivable 
B) accounts payable 
C) accruals 
D) notes payable 
E) all of the above are current liabilities 
A) accounts receivable 
B) accounts payable 
C) accruals 
D) notes payable 
E) all of the above are current liabilities

Question 7

Which of the following would not be included on the balance sheet?

Accepted Answer

A) dividends paid 
B) retained earnings 
C) surplus account 
D) common stock 
A) dividends paid 
B) retained earnings 
C) surplus account 
D) common stock

Question 8

A firm's net income over some period is the same as its cash flow.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following is not considered to be one of the three major forms of business ownership in the United States?

Accepted Answer

A) proprietorship 
B) partnership 
C) public limited company 
D) corporation 
A) proprietorship 
B) partnership 
C) public limited company 
D) corporation

Question 10

Market value added can be written as: the market value of stock minus the market value of debt plus the book value of stock minus the book value of debt.

Accepted Answer

A) True 
 B)False

Question 11

Suppose Ningbo Steel had sales revenue of $10,000 sales revenue,cost of goods sold of $5,000,operating expenses of $3000,interest expense of $1,000,a tax rate of 20%,and 1,000 shares of common stock outstanding.Based on this information,net profit after tax was:

Accepted Answer

A) $1,500 
B) $1,000 
C) $500 
D) $0 
E) none of the above 
A) $1,500 
B) $1,000 
C) $500 
D) $0 
E) none of the above

Question 12

Owners' equity may include:

Accepted Answer

A) common stock 
B) retained earnings 
C) surplus account 
D) all the above 
E) none of the above 
A) common stock 
B) retained earnings 
C) surplus account 
D) all the above 
E) none of the above

Question 13

Net income is:

Accepted Answer

A) equal to cash flow 
B) profits remaining after income taxes are paid 
C) unavailable to the owners of the business 
D) none of the above 
A) equal to cash flow 
B) profits remaining after income taxes are paid 
C) unavailable to the owners of the business 
D) none of the above

Question 14

The financial statement that provides a snapshot view of the financial condition of a business at a point in time is the:

Accepted Answer

A) balance sheet 
B) income statement 
C) statement of cash flows 
D) statement of retained earnings 
E) two of the above 
A) balance sheet 
B) income statement 
C) statement of cash flows 
D) statement of retained earnings 
E) two of the above

Question 15

The liability of all owners in both a limited liability company and a limited partnership is limited to the owners' investment in the company.

Accepted Answer

A) True 
 B)False

Question 16

A limited liability company can have an unlimited number of shareholders,including other corporations.

Accepted Answer

A) True 
 B)False

Question 17

The notes receivable of a firm may be:

Accepted Answer

A) loans to other businesses 
B) loans to employees 
C) loans to the CEO 
D) all of the above 
A) loans to other businesses 
B) loans to employees 
C) loans to the CEO 
D) all of the above

Question 18

Nestle,IBM,and Coca-Cola are examples of:

Accepted Answer

A) U.S.corporations 
B) corporations with mainly domestic revenues 
C) "stateless" corporations 
D) multinational corporations based in the U.S. 
A) U.S.corporations 
B) corporations with mainly domestic revenues 
C) "stateless" corporations 
D) multinational corporations based in the U.S.

Question 19

Of the following forms of business organization,which have stockholders with limited liability?

Accepted Answer

A) proprietorships 
B) partnerships 
C) corporations 
D) limited partnerships 
A) proprietorships 
B) partnerships 
C) corporations 
D) limited partnerships

Question 20

The three main sections of the statement of cash flows include all of the following EXCEPT:

Accepted Answer

A) cash from saving 
B) cash from investments 
C) cash from operations 
D) cash from financing 
E) all are included 
A) cash from saving 
B) cash from investments 
C) cash from operations 
D) cash from financing 
E) all are included

Which one of the following financial statements conveys a relationship of equality between assets and liabilities plus owners' equity?

Which of the following statements is false?

A limited liability company (LLC):

In the statement of cash flows,retained earnings are reported as two separate line items,which are and _.

Agency costs are:

All of the following accounts are considered to be current liabilities on the balance sheet except:

Which of the following would not be included on the balance sheet?

A firm's net income over some period is the same as its cash flow.

Which of the following is not considered to be one of the three major forms of business ownership in the United States?

Market value added can be written as: the market value of stock minus the market value of debt plus the book value of stock minus the book value of debt.

Suppose Ningbo Steel had sales revenue of $10,000 sales revenue,cost of goods sold of $5,000,operating expenses of $3000,interest expense of $1,000,a tax rate of 20%,and 1,000 shares of common stock outstanding.Based on this information,net profit after tax was:

Owners' equity may include:

Net income is:

The financial statement that provides a snapshot view of the financial condition of a business at a point in time is the:

The liability of all owners in both a limited liability company and a limited partnership is limited to the owners' investment in the company.

A limited liability company can have an unlimited number of shareholders,including other corporations.

The notes receivable of a firm may be:

Nestle,IBM,and Coca-Cola are examples of:

Of the following forms of business organization,which have stockholders with limited liability?

The three main sections of the statement of cash flows include all of the following EXCEPT:

The Financial Environment

Money and the Monetary System

Banks and Other Financial Institutions

Federal Reserve System

Policy Makers and the Money Supply

International Finance and Trade

Savings and Investment Process

Interest Rates

Time Value of Money

Bonds and Stocks: Characteristics and Valuation

Securities Markets

Financial Return and Risk Concepts

Financial Analysis and Long-Term Financial Planning

Managing Working Capital

Short-Term Business Financing

Capital Budgeting Analysis

Capital Structure and the Cost of Capital

Filters

Exam 13: Business Organization and Financial Data

Which one of the following financial statements conveys a relationship of equality between assets and liabilities plus owners' equity?

Which of the following statements is false?

A limited liability company (LLC):

In the statement of cash flows,retained earnings are reported as two separate line items,which are __________ and ___________.

Agency costs are:

All of the following accounts are considered to be current liabilities on the balance sheet except:

Which of the following would not be included on the balance sheet?

A firm's net income over some period is the same as its cash flow.

Which of the following is not considered to be one of the three major forms of business ownership in the United States?

Market value added can be written as: the market value of stock minus the market value of debt plus the book value of stock minus the book value of debt.

Suppose Ningbo Steel had sales revenue of $10,000 sales revenue,cost of goods sold of $5,000,operating expenses of $3000,interest expense of $1,000,a tax rate of 20%,and 1,000 shares of common stock outstanding.Based on this information,net profit after tax was:

Owners' equity may include:

Net income is:

The financial statement that provides a snapshot view of the financial condition of a business at a point in time is the:

The liability of all owners in both a limited liability company and a limited partnership is limited to the owners' investment in the company.

A limited liability company can have an unlimited number of shareholders,including other corporations.

The notes receivable of a firm may be:

Nestle,IBM,and Coca-Cola are examples of:

Of the following forms of business organization,which have stockholders with limited liability?

The three main sections of the statement of cash flows include all of the following EXCEPT:

The Financial Environment

Money and the Monetary System

Banks and Other Financial Institutions

Federal Reserve System

Policy Makers and the Money Supply

International Finance and Trade

Savings and Investment Process

Interest Rates

Time Value of Money

Bonds and Stocks: Characteristics and Valuation

Securities Markets

Financial Return and Risk Concepts

Financial Analysis and Long-Term Financial Planning

Managing Working Capital

Short-Term Business Financing

Capital Budgeting Analysis

Capital Structure and the Cost of Capital

Filters

In the statement of cash flows,retained earnings are reported as two separate line items,which are and _.