Question 1

Stockholders of a corporation are its internal stakeholders.

Accepted Answer

A) True 
 B)False

Question 2

Creditors have preference to assets behind stockholders if a business fails.

Accepted Answer

A) True 
 B)False

Question 3

Heedy Company had the following account balances in 2015 and 2016,respectively.Assuming dividends of $20,000 were paid in 2016,how much was net income?

Accepted Answer

A) $62,000 
B) $82,000 
C) $272,000 
D) $252,000 
A) $62,000 
B) $82,000 
C) $272,000 
D) $252,000

Question 4

From the following information for BlueInks Corporation,compute the rate on return of assets.

Accepted Answer

A) 20.90% 
B) 25.06% 
C) 22.89% 
D) 18.73% 
A) 20.90% 
B) 25.06% 
C) 22.89% 
D) 18.73%

Question 5

Costs incurred in operating a business are also known as:

Accepted Answer

A) revenues. 
B) expenses. 
C) liabilities. 
D) dividends. 
A) revenues. 
B) expenses. 
C) liabilities. 
D) dividends.

Question 6

Which of the following is not a characteristic of a corporation?

Accepted Answer

A) Corporations are organized as a separate legal taxable entity. 
B) Ownership is divided into shares of stock. 
C) Corporations experience an ease in obtaining large amounts of resources by issuing stock. 
D) A corporation can elect to be taxed as a partnership. 
A) Corporations are organized as a separate legal taxable entity. 
B) Ownership is divided into shares of stock. 
C) Corporations experience an ease in obtaining large amounts of resources by issuing stock. 
D) A corporation can elect to be taxed as a partnership.

Question 7

Recording revenue when a sale is made most directly relates to which concept?

Accepted Answer

A) Going concern concept 
B) Periodicity concept 
C) Matching concept 
D) Adequate disclosure concept 
A) Going concern concept 
B) Periodicity concept 
C) Matching concept 
D) Adequate disclosure concept

Question 8

The objective of most businesses is to maximize profits.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following is true of rate of return on assets?

Accepted Answer

A) It is a measure of a company's profitability. 
B) It is used to evaluate a company's ability to pay off its short­term debts. 
C) It is used to determine the financial leverage of a company. 
D) It is a measure of the optimum capital structure. 
A) It is a measure of a company's profitability. 
B) It is used to evaluate a company's ability to pay off its short­term debts. 
C) It is used to determine the financial leverage of a company. 
D) It is a measure of the optimum capital structure.

Question 10

What is the basic accounting equation,and which financial statement is prepared from this equation?

Accepted Answer

Assets = Liabilities

Question 11

Accounting is thought to be the "language of business" because business information is communicated to stakeholders.

Accepted Answer

A) True 
 B)False

Question 12

Following are the financial statement data for Degen Temporary Services at December 31,2015.Prepare Degen's income statement.

Accepted Answer

Degen Temporary Services Income Statemen

Question 13

A list of assets,liabilities,and owners' equity as of a specific date is a(n):

Accepted Answer

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

Question 14

The role of accounting in business is best defined as:

Accepted Answer

A) an information system that provides reports to stakeholders about the economic activities and condition of a business. 
B) a method of forecasting the future profitability of a company. 
C) the policies,procedures,and strategies used in a business. 
D) transaction analysis. 
A) an information system that provides reports to stakeholders about the economic activities and condition of a business. 
B) a method of forecasting the future profitability of a company. 
C) the policies,procedures,and strategies used in a business. 
D) transaction analysis.

Question 15

A corporation is a business that is legally separate and distinct from its owners.

Accepted Answer

A) True 
 B)False

Question 16

Manufacturing businesses change basic inputs into products that are sold to individual customers.

Accepted Answer

A) True 
 B)False

Question 17

Rights to payments from customers are:

Accepted Answer

A) liabilities. 
B) prepaid expenses. 
C) accounts receivable. 
D) accounts payable. 
A) liabilities. 
B) prepaid expenses. 
C) accounts receivable. 
D) accounts payable.

Question 18

On May 31,2015,Deana's Services Company had account balances as follows:

Accepted Answer

(a) Deana's Services Company Income Stat

Question 19

The financial statement that presents a summary of the revenues and expenses of a business for a specific period of time,such as a month or an year,is called a(n):

Accepted Answer

A) prior period statement. 
B) statement of retained earnings. 
C) income statement. 
D) balance sheet. 
A) prior period statement. 
B) statement of retained earnings. 
C) income statement. 
D) balance sheet.

Question 20

is an example of internal stakeholders.

Accepted Answer

A) Managers 
B) Creditors 
C) Stockholders 
D) Suppliers 
A) Managers 
B) Creditors 
C) Stockholders 
D) Suppliers

Stockholders of a corporation are its internal stakeholders.

Creditors have preference to assets behind stockholders if a business fails.

Heedy Company had the following account balances in 2015 and 2016,respectively.Assuming dividends of $20,000 were paid in 2016,how much was net income?

From the following information for BlueInks Corporation,compute the rate on return of assets.

Costs incurred in operating a business are also known as:

Which of the following is not a characteristic of a corporation?

Recording revenue when a sale is made most directly relates to which concept?

The objective of most businesses is to maximize profits.

Which of the following is true of rate of return on assets?

What is the basic accounting equation,and which financial statement is prepared from this equation?

Accounting is thought to be the "language of business" because business information is communicated to stakeholders.

Following are the financial statement data for Degen Temporary Services at December 31,2015.Prepare Degen's income statement.

A list of assets,liabilities,and owners' equity as of a specific date is a(n):

The role of accounting in business is best defined as:

A corporation is a business that is legally separate and distinct from its owners.

Manufacturing businesses change basic inputs into products that are sold to individual customers.

Rights to payments from customers are:

On May 31,2015,Deana's Services Company had account balances as follows:

The financial statement that presents a summary of the revenues and expenses of a business for a specific period of time,such as a month or an year,is called a(n):

is an example of internal stakeholders.

Basic Accounting Concepts

Accrual Accounting Concepts

Accounting for Merchandising Businesses

Sarbanes-Oxley, internal Control, and Cash

Receivables and Inventories

Fixed Assets and Intangible Assets

Liabilities and Stockholders Equity

Financial Statement Analysis

Accounting Systems for Manufacturing Businesses

Cost Behavior and Cost-Volume-Profit Analysis

Differential Analysis and Product Pricing

Budgeting and Standard Cost Systems

Performance Evaluation for Decentralized Operations

Capital Investment Analysis

Filters

Exam 1: The Role of Accounting in Business

Stockholders of a corporation are its internal stakeholders.

Creditors have preference to assets behind stockholders if a business fails.

Heedy Company had the following account balances in 2015 and 2016,respectively.Assuming dividends of $20,000 were paid in 2016,how much was net income?

From the following information for BlueInks Corporation,compute the rate on return of assets.

Costs incurred in operating a business are also known as:

Which of the following is not a characteristic of a corporation?

Recording revenue when a sale is made most directly relates to which concept?

The objective of most businesses is to maximize profits.

Which of the following is true of rate of return on assets?

What is the basic accounting equation,and which financial statement is prepared from this equation?

Accounting is thought to be the "language of business" because business information is communicated to stakeholders.

Following are the financial statement data for Degen Temporary Services at December 31,2015.Prepare Degen's income statement.

A list of assets,liabilities,and owners' equity as of a specific date is a(n):

The role of accounting in business is best defined as:

A corporation is a business that is legally separate and distinct from its owners.

Manufacturing businesses change basic inputs into products that are sold to individual customers.

Rights to payments from customers are:

On May 31,2015,Deana's Services Company had account balances as follows:

The financial statement that presents a summary of the revenues and expenses of a business for a specific period of time,such as a month or an year,is called a(n):

is an example of internal stakeholders.

Basic Accounting Concepts

Accrual Accounting Concepts

Accounting for Merchandising Businesses

Sarbanes-Oxley, internal Control, and Cash

Receivables and Inventories

Fixed Assets and Intangible Assets

Liabilities and Stockholders Equity

Financial Statement Analysis

Accounting Systems for Manufacturing Businesses

Cost Behavior and Cost-Volume-Profit Analysis

Differential Analysis and Product Pricing

Budgeting and Standard Cost Systems

Performance Evaluation for Decentralized Operations

Capital Investment Analysis

Filters