Exam 15: Basic Accounting: Concepts, techniques, and Conventions

The following information was extracted from the accounting records of Ernest Company: At the beginning of the period,what is the total amount of liabilities?

A cash payment on accounts payable will ________.

The main sections of the balance sheet include ________.

This transaction will increase net income under the accrual basis,but will not increase net income under the cash basis.

Decreases in ownership claims arising from the delivery of goods are called ________.

Retained earnings are a general claim against ________.

An audit guarantees that there are absolutely no mistakes in the financial statements.

The income statement summarizes a company's financial performance ________ and the balance sheet shows a company's financial position ________.

Cash collected from customers before goods are delivered is known as ________.

In a corporation,stockholders' equity has two parts called ________ and ________.

In the United States,Generally Accepted Accounting Principles are developed primarily by ________.

A company uses the going concern convention when it is in a near-bankrupt situation.

Shack Company has the following information available for the most current year: What was the paid-in capital at December 31,2010 for Shack Company?

Which of the following statements is FALSE?

The transactions for the Newman Company are below: 1.The owners invested $10,000 cash in the company. 2.The company acquired equipment that cost $8,000.25% was paid in cash and the rest was settled with a note. 3.The company acquired $2,800 of inventory and paid cash. 4.The company acquired $600 of supplies on account. 5.The company sold merchandise for $1,800 on account.The inventory had a cost of $1,000. 6.The company received $400 from Transaction #5. 7.The company paid $300 on accounts payable. Required: Prepare an analysis of Newman Company's transactions using the equation approach.

A multiple step income statement ________.

The accounting convention of ________ guides the design of accounting systems.

A deficiency of cash-basis accounting is ________.

The cost recovery concept carries asset balances forward because their costs are expected to be recovered in future periods.

Implicit transactions are associated with ________.