Question 1

The accounting convention of ________ permits a company to immediately expense assets with long useful lives and small dollar costs.

Accepted Answer

A) objectivity 
B) materiality 
C) continuity 
D) conservatism 
A) objectivity 
B) materiality 
C) continuity 
D) conservatism

Question 2

How do accountants recognize revenue?

Accepted Answer

A) by recording it in the accounting records 
B) by reporting it on the financial statements 
C) by waiting for the collection of cash from the revenue 
D) by applying the materiality principle 
A) by recording it in the accounting records 
B) by reporting it on the financial statements 
C) by waiting for the collection of cash from the revenue 
D) by applying the materiality principle

Question 3

Under accrual basis accounting,research and development expenses for new products are recorded as ________.

Accepted Answer

A) assets and written off systematically over the expected life 
B) assets and expensed when paid in cash 
C) assets and expensed when the related products are sold 
D) expenses immediately 
A) assets and written off systematically over the expected life 
B) assets and expensed when paid in cash 
C) assets and expensed when the related products are sold 
D) expenses immediately

Question 4

Stockholders' equity is composed of paid-in capital and retained earnings.

Accepted Answer

A) True 
 B)False

Question 5

Each item in a financial statement is an account.

Accepted Answer

A) True 
 B)False

Question 6

The accrual basis of accounting recognizes the impact of transactions when cash is received or paid.

Accepted Answer

A) True 
 B)False

Question 7

Woody Company had the following data available:
   Required:
Prepare a statement of retained earnings for Woody Company for the year ended December 31,2015.

Accepted Answer

The answer of Woody Company had the following data available:
...

Question 8

The income statement measures performance over a given amount of time.

Accepted Answer

A) True 
 B)False

Question 9

Examples of accrued expenses are wages payable and interest payable.

Accepted Answer

A) True 
 B)False

Question 10

In order for the board of directors of a corporation to declare a cash dividend,there must be sufficient ________ and ________.

Accepted Answer

A) revenues; expenses 
B) net income; cash 
C) retained earnings; cash 
D) revenues; cash 
A) revenues; expenses 
B) net income; cash 
C) retained earnings; cash 
D) revenues; cash

Question 11

Scorpion Company pays wages of $400 per day.The work week begins on Monday and ends on Friday.Wages are paid weekly on Friday.The current month ends on a Wednesday.The adjusting entry at the end of the month will ________.

Accepted Answer

A) increase expenses by $400 
B) increase expenses by $800 
C) increase expenses by $1,200 
D) increase expenses by $2,000 
A) increase expenses by $400 
B) increase expenses by $800 
C) increase expenses by $1,200 
D) increase expenses by $2,000

Question 12

A sale of inventory results in a(n)________ in stockholders' equity equal to the selling price of the inventory.A sale of inventory also results in a(n)________ in stockholders' equity equal to the cost of the inventory sold.

Accepted Answer

A) decrease; increase 
B) increase; increase 
C) increase; decrease 
D) decrease; decrease 
A) decrease; increase 
B) increase; increase 
C) increase; decrease 
D) decrease; decrease

Question 13

Gross profit is the excess of sales over all expenses.

Accepted Answer

A) True 
 B)False

Question 14

The accounting convention of ________ means selecting the method of measurement that provides the most pessimistic immediate results.

Accepted Answer

A) cost benefit 
B) objectivity 
C) materiality 
D) conservatism 
A) cost benefit 
B) objectivity 
C) materiality 
D) conservatism

Question 15

Owners' equity represents the excess cash a company has made.

Accepted Answer

A) True 
 B)False

Question 16

Depreciation expense is computed on ________.

Accepted Answer

A) equipment and land 
B) land and buildings 
C) equipment and buildings 
D) equipment,land and building 
A) equipment and land 
B) land and buildings 
C) equipment and buildings 
D) equipment,land and building

Question 17

Soley Company has the following data available:   What is the retained earnings balance on December 31,2011?

Accepted Answer

A) $12,000 
B) $13,000 
C) $14,000 
D) $63,000 
A) $12,000 
B) $13,000 
C) $14,000 
D) $63,000

Question 18

Liabilities are the entity's economic obligations to owners.

Accepted Answer

A) True 
 B)False

Question 19

The excess of revenues over expenses is called a net profit.

Accepted Answer

A) True 
 B)False

Question 20

Increases in revenues ________ stockholders' equity.Increases in expenses ________ stockholders' equity.

Accepted Answer

A) decrease; increase 
B) increase; decrease 
C) decrease; decrease 
D) increase; increase 
A) decrease; increase 
B) increase; decrease 
C) decrease; decrease 
D) increase; increase

The accounting convention of ________ permits a company to immediately expense assets with long useful lives and small dollar costs.

How do accountants recognize revenue?

Under accrual basis accounting,research and development expenses for new products are recorded as ________.

Stockholders' equity is composed of paid-in capital and retained earnings.

Each item in a financial statement is an account.

The accrual basis of accounting recognizes the impact of transactions when cash is received or paid.

Woody Company had the following data available: Required: Prepare a statement of retained earnings for Woody Company for the year ended December 31,2015.

The income statement measures performance over a given amount of time.

Examples of accrued expenses are wages payable and interest payable.

In order for the board of directors of a corporation to declare a cash dividend,there must be sufficient and .

Scorpion Company pays wages of $400 per day.The work week begins on Monday and ends on Friday.Wages are paid weekly on Friday.The current month ends on a Wednesday.The adjusting entry at the end of the month will ________.

A sale of inventory results in a(n) in stockholders' equity equal to the selling price of the inventory.A sale of inventory also results in a(n) in stockholders' equity equal to the cost of the inventory sold.

Gross profit is the excess of sales over all expenses.

The accounting convention of ________ means selecting the method of measurement that provides the most pessimistic immediate results.

Owners' equity represents the excess cash a company has made.

Depreciation expense is computed on ________.

Soley Company has the following data available: What is the retained earnings balance on December 31,2011?

Liabilities are the entity's economic obligations to owners.

The excess of revenues over expenses is called a net profit.

Increases in revenues stockholders' equity.Increases in expenses stockholders' equity.

Managerial Accounting, the Business Organization

Introduction to Cost Behavior and Cost-Volume Relationships

Measurement of Cost Behavior

Cost Management Systems and Activity-Based Costing

Relevant Information for Decision Making With a Focus

Relevant Information for Decision Making With a Focus

Introduction to Budgets and Preparing the Master Budget

Flexible Budgets and Variance Analysis

Management Control Systems and Responsibility Accounting

Management Control in Decentralized Organizations

Capital Budgeting

Cost Allocation

Accounting for Overhead Costs

Job-Order Costing and Process-Costing Systems

Understanding Corporate Annual Reports: Basic Financial Statements

Understanding and Analyzing Consolidated Financial Statements

Filters

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

The accounting convention of ________ permits a company to immediately expense assets with long useful lives and small dollar costs.

How do accountants recognize revenue?

Under accrual basis accounting,research and development expenses for new products are recorded as ________.

Stockholders' equity is composed of paid-in capital and retained earnings.

Each item in a financial statement is an account.

The accrual basis of accounting recognizes the impact of transactions when cash is received or paid.

Woody Company had the following data available: Required: Prepare a statement of retained earnings for Woody Company for the year ended December 31,2015.

The income statement measures performance over a given amount of time.

Examples of accrued expenses are wages payable and interest payable.

In order for the board of directors of a corporation to declare a cash dividend,there must be sufficient ________ and ________.

Scorpion Company pays wages of $400 per day.The work week begins on Monday and ends on Friday.Wages are paid weekly on Friday.The current month ends on a Wednesday.The adjusting entry at the end of the month will ________.

A sale of inventory results in a(n)________ in stockholders' equity equal to the selling price of the inventory.A sale of inventory also results in a(n)________ in stockholders' equity equal to the cost of the inventory sold.

Gross profit is the excess of sales over all expenses.

The accounting convention of ________ means selecting the method of measurement that provides the most pessimistic immediate results.

Owners' equity represents the excess cash a company has made.

Depreciation expense is computed on ________.

Soley Company has the following data available: What is the retained earnings balance on December 31,2011?

Liabilities are the entity's economic obligations to owners.

The excess of revenues over expenses is called a net profit.

Increases in revenues ________ stockholders' equity.Increases in expenses ________ stockholders' equity.

Managerial Accounting, the Business Organization

Introduction to Cost Behavior and Cost-Volume Relationships

Measurement of Cost Behavior

Cost Management Systems and Activity-Based Costing

Relevant Information for Decision Making With a Focus

Relevant Information for Decision Making With a Focus

Introduction to Budgets and Preparing the Master Budget

Flexible Budgets and Variance Analysis

Management Control Systems and Responsibility Accounting

Management Control in Decentralized Organizations

Capital Budgeting

Cost Allocation

Accounting for Overhead Costs

Job-Order Costing and Process-Costing Systems

Understanding Corporate Annual Reports: Basic Financial Statements

Understanding and Analyzing Consolidated Financial Statements

Filters

In order for the board of directors of a corporation to declare a cash dividend,there must be sufficient and .

A sale of inventory results in a(n) in stockholders' equity equal to the selling price of the inventory.A sale of inventory also results in a(n) in stockholders' equity equal to the cost of the inventory sold.

Increases in revenues stockholders' equity.Increases in expenses stockholders' equity.