Exam 1: Accounting and the Financial Statements

The type of business activity that relates to obtaining funds from either issuing stock or borrowing money is called ____________________.

Match each statement to the item listed below. a.Cash flows from financing activities b.Cash flows from investing activities c.Cash flows from operating activities -Cash flows directly related to earning income

Suppose a company reports the following information at December 31, 2013: What is the company's Gross Profit?

The Statement of Cash Flows classifies cash flow into these three categories: ____________________, ____________________ and ____________________.

Which of the following invests funds into a business and is considered an owner?

Several items from the financial statements of Fireside Tires are listed. Use the following choices to identify the type of account for each item listed. (Choices may be used more than once.) a.Assets b.Liabilities c.Revenues d.Expenses e.Stockholders' Equity -Research and development expense

A certain company started business on January 1, 2013 with assets of $1,000,000 and stockholders' equity of $565,000. By the end of the year, assets increased by $100,000 and liabilities decreased by $150,000. Other than net income or loss, the only change in stockholders' equity was dividends of $50,000.

-Refer to B-There Transportation. Is the change in the current ratio favorable or not? Explain.

Income from operations includes interest revenue and interest expense because these items are considered to be operating in nature.

-Refer to Beard Marine. What was the balance of Retained Earnings at January 1, 2013?

-Refer to Baker's Pride Bakery. How much of the company is financed by creditors at the end of December 2013? Evaluate the change from 2012 to 2013.

-Refer to B-There Transportation. Suppose the company had a decrease in its cash account from 2012 to 2013. Would the other current asset amounts have increased or decreased? Explain.

Which of the following items will be found in a corporate annual report?

What information is provided in an annual report in addition to the financial statements?

What financial statement items are investors and creditors most interested in and why?

Barrett Oil Company reported the following balances as of December 31, 2013: What is the company's current ratio?

Match each statement to the item listed below. a.Audit report b.Fiscal year c.Financial statements d.Management's discussion and analysis e.Notes to the financial statements -An accounting period that may or may not cover January 1 - December 31

What is the name of the branch of accounting concerned with providing outside decision makers with information to assess the amounts, timing and uncertainties of the company's future cash flows?

Several items from the financial statements of Fireside Tires are listed. Use the following choices to identify the type of account for each item listed. (Choices may be used more than once.) a.Assets b.Liabilities c.Revenues d.Expenses e.Stockholders' Equity -Interest Income

One primary purpose of a classified balance sheet is to help users evaluate the working capital of a company.