Question 1

Revenue is properly recognized:

Accepted Answer

A) When the customer makes an order. 
B) Only if the transaction creates an account receivable. 
C) At the end of the accounting period. 
D) When goods or services are provided to customers and at the amount expected to be received from the customer. 
E) When cash from a sale is received. 
A) When the customer makes an order. 
B) Only if the transaction creates an account receivable. 
C) At the end of the accounting period. 
D) When goods or services are provided to customers and at the amount expected to be received from the customer. 
E) When cash from a sale is received.

Question 2

The income statement reports on operating activities at a point in time.

Accepted Answer

A) True 
 B)False

Question 3

Net income occurs when revenues exceed expenses.

Accepted Answer

A) True 
 B)False

Question 4

Atkins Company collected $1,750 as payment for the amount owed by a customer from services provided the prior month on credit.How does this transaction affect the accounting equation for Atkins?

Accepted Answer

A) Assets would decrease $1,750 and liabilities would decrease $1,750. 
B) One asset would increase $1,750 and a different asset would decrease $1,750,causing no net change in the accounting equation. 
C) Assets would increase $1,750 and equity would increase $1,750. 
D) Assets would increase $1,750 and liabilities would increase $1,750. 
E) Liabilities would decrease $1,750 and equity would increase $1,750. 
A) Assets would decrease $1,750 and liabilities would decrease $1,750. 
B) One asset would increase $1,750 and a different asset would decrease $1,750,causing no net change in the accounting equation. 
C) Assets would increase $1,750 and equity would increase $1,750. 
D) Assets would increase $1,750 and liabilities would increase $1,750. 
E) Liabilities would decrease $1,750 and equity would increase $1,750.

Question 5

General principles are the basic assumptions,concepts,and guidelines for preparing financial statements.GAAP aims to make information relevant and representationally faithful.

Accepted Answer

A) True 
 B)False

Question 6

In accounting,the rule that requires that assets,services,and liabilities be recorded initially at the cash or cash-equivalent value of what was given up or of the item received is called the ________.

Accepted Answer

Measuremen

Question 7

U.S.treasury bonds are:

Accepted Answer

A) High-risk and high-return investments. 
B) Low-risk and low-return investments. 
C) High-risk and low-return investments. 
D) Low-risk and high-return investments. 
E) High risk and no-return investments. 
A) High-risk and high-return investments. 
B) Low-risk and low-return investments. 
C) High-risk and low-return investments. 
D) Low-risk and high-return investments. 
E) High risk and no-return investments.

Question 8

If a company purchases equipment costing $4,500 on credit,the effect on the accounting equation would be:

Accepted Answer

A) Assets increase $4,500 and liabilities decrease $4,500. 
B) Equity decreases $4,500 and liabilities increase $4,500. 
C) One asset increases $4,500 and another asset decreases $4,500. 
D) Assets increase $4,500 and liabilities increase $4,500. 
E) Equity increases $4,500 and liabilities decrease $4,500. 
A) Assets increase $4,500 and liabilities decrease $4,500. 
B) Equity decreases $4,500 and liabilities increase $4,500. 
C) One asset increases $4,500 and another asset decreases $4,500. 
D) Assets increase $4,500 and liabilities increase $4,500. 
E) Equity increases $4,500 and liabilities decrease $4,500.

Question 9

Which of the following accounting principles prescribes that a company record its expenses incurred to generate the revenue reported?

Accepted Answer

A) Going-concern assumption. 
B) Expense recognition (Matching)principle. 
C) Measurement (Cost)principle. 
D) Business entity assumption. 
E) Consideration assumption. 
A) Going-concern assumption. 
B) Expense recognition (Matching)principle. 
C) Measurement (Cost)principle. 
D) Business entity assumption. 
E) Consideration assumption.

Question 10

If the liabilities of a company increased $74,000 during a period of time and equity in the company decreased $19,000 during the same period,what was the effect on the assets?

Accepted Answer

A) Assets would have increased $55,000. 
B) Assets would have decreased $55,000. 
C) Assets would have increased $93,000. 
D) Assets would have decreased $93,000. 
E) None of the above. 
A) Assets would have increased $55,000. 
B) Assets would have decreased $55,000. 
C) Assets would have increased $93,000. 
D) Assets would have decreased $93,000. 
E) None of the above.

Question 11

The ________ assumption states that transactions and events are expressed in money units.

Accepted Answer

The answer of The ________ assumption states that transactions and...

Question 12

Use the following information for Meeker Corp.to determine the amount of equity to report.

Accepted Answer

A) $390,000. 
B) $140,000. 
C) $20,000. 
D) $530,000. 
E) $270,000. 
A) $390,000. 
B) $140,000. 
C) $20,000. 
D) $530,000. 
E) $270,000.

Question 13

A company's balance sheet shows: cash $24,000,accounts receivable $30,000,equipment $50,000,and equity $72,000.What is the amount of liabilities?

Accepted Answer

A) $104,000. 
B) $76,000. 
C) $32,000. 
D) $68,000. 
E) $176,000. 
A) $104,000. 
B) $76,000. 
C) $32,000. 
D) $68,000. 
E) $176,000.

Question 14

Cash investments by stockholders are listed on which of the following statements?

Accepted Answer

A) Statement of retained earnings and income statement. 
B) Income statement only. 
C) Retained earnings only. 
D) Statement of retained earnings and statement of cash flows. 
E) Statement of cash flows only. 
A) Statement of retained earnings and income statement. 
B) Income statement only. 
C) Retained earnings only. 
D) Statement of retained earnings and statement of cash flows. 
E) Statement of cash flows only.

Question 15

The financial statement that identifies a company's cash receipts and cash payments over a period of time is the:

Accepted Answer

A) Statement of financial position. 
B) Statement of cash flows. 
C) Balance sheet. 
D) Income statement. 
E) Statement of changes in stockholders' equity. 
A) Statement of financial position. 
B) Statement of cash flows. 
C) Balance sheet. 
D) Income statement. 
E) Statement of changes in stockholders' equity.

Question 16

The three major types of business activities are operating,financing,and investing.

Accepted Answer

A) True 
 B)False

Question 17

Regulators often have legal authority over certain activities of organizations.

Accepted Answer

A) True 
 B)False

Question 18

The revenue recognition principle:

Accepted Answer

A) Prescribes that accounting information is based on actual cost. 
B) Provides guidance on when a company must recognize revenue. 
C) Prescribes that a company report the details behind financial statements that would impact users' decisions. 
D) Prescribes that a company record the expenses it incurred to generate the revenue reported. 
E) Means that accounting information reflects a presumption that the business will continue operating instead of being closed or sold. 
A) Prescribes that accounting information is based on actual cost. 
B) Provides guidance on when a company must recognize revenue. 
C) Prescribes that a company report the details behind financial statements that would impact users' decisions. 
D) Prescribes that a company record the expenses it incurred to generate the revenue reported. 
E) Means that accounting information reflects a presumption that the business will continue operating instead of being closed or sold.

Question 19

Savvy Sightseeing had beginning equity of $72,000; revenues of $90,000,expenses of $65,000,and dividends to stockholders of $9,000; there were no stock issuances.Calculate the ending equity.

Accepted Answer

A) $88,000. 
B) $25,000. 
C) $97,000. 
D) $38,000. 
E) $47,000. 
A) $88,000. 
B) $25,000. 
C) $97,000. 
D) $38,000. 
E) $47,000.

Question 20

The difference between a company's assets and its liabilities,or net assets is:

Accepted Answer

A) Net income. 
B) Expense. 
C) Equity. 
D) Revenue. 
E) Net loss. 
A) Net income. 
B) Expense. 
C) Equity. 
D) Revenue. 
E) Net loss.

Exam 1: Accounting in Business

Revenue is properly recognized:

The income statement reports on operating activities at a point in time.

Net income occurs when revenues exceed expenses.

Atkins Company collected $1,750 as payment for the amount owed by a customer from services provided the prior month on credit.How does this transaction affect the accounting equation for Atkins?

General principles are the basic assumptions,concepts,and guidelines for preparing financial statements.GAAP aims to make information relevant and representationally faithful.

In accounting,the rule that requires that assets,services,and liabilities be recorded initially at the cash or cash-equivalent value of what was given up or of the item received is called the ________.

U.S.treasury bonds are:

If a company purchases equipment costing $4,500 on credit,the effect on the accounting equation would be:

Which of the following accounting principles prescribes that a company record its expenses incurred to generate the revenue reported?

If the liabilities of a company increased $74,000 during a period of time and equity in the company decreased $19,000 during the same period,what was the effect on the assets?

The ________ assumption states that transactions and events are expressed in money units.

Use the following information for Meeker Corp.to determine the amount of equity to report.

A company's balance sheet shows: cash $24,000,accounts receivable $30,000,equipment $50,000,and equity $72,000.What is the amount of liabilities?

Cash investments by stockholders are listed on which of the following statements?

The financial statement that identifies a company's cash receipts and cash payments over a period of time is the:

The three major types of business activities are operating,financing,and investing.

Regulators often have legal authority over certain activities of organizations.

The revenue recognition principle:

Savvy Sightseeing had beginning equity of $72,000; revenues of $90,000,expenses of $65,000,and dividends to stockholders of $9,000; there were no stock issuances.Calculate the ending equity.

The difference between a company's assets and its liabilities,or net assets is:

Accounting for Business Transactions

Adjusting Accounts for Financial Statements

Accounting for Merchandising Operations

Inventories and Cost of Sales

Cash,fraud,and Internal Controls

Accounting for Receivables

Accounting for Long-Term Assets

Accounting for Current Liabilities

Accounting for Long-Term Liabilities

Corporate Reporting and Analysis

Reporting Cash Flows

Analysis of Financial Statements

Managerial Accounting Concepts and Principles

Job Order Costing and Analysis

Process Costing and Analysis

Activity-Based Costing and Analysis

Cost Behavior and Cost-Volume-Profit Analysis

Variable Costing and Analysis

Master Budgets and Performance Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Relevant Costing for Managerial Decisions

Capital Budgeting and Investment Analysis

Time Value of Money

Investments

Lean Principles and Accounting

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