Exam 1: Accounting in Business

Return on assets is also known as return on investment.

Zapper has beginning equity of $257,000,net income of $51,000,dividends of $40,000 and stockholder investments of $6,000.Its ending equity is:

Match the following terms with the appropriate definition. -Time period assumption

The following is a list of selected users of accounting information. Match the appropriate user to the following decisions they make with accounting information. -Assess whether an organization is likely to repay its loans with interest.

Dawson Electronic Services had revenues of $80,000 and expenses of $50,000 for the year.Its assets at the beginning of the year were $400,000.At the end of the year assets were worth $450,000.Calculate its return on assets.

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

The following is a list of selected users of accounting information. Match the appropriate user to the following decisions they make with accounting information. -Judge the soundness of a customer before making sales on credit.

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?

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 stockholder investments during the year.Calculate ending equity.

The assumption that requires that a business be accounted for separately from its owners is the ________ assumption.

Define risk and return and discuss the relation between them.

Which of the following accounts is not included in the asset section of the balance sheet?

Arrow's net income of $117 million and average assets of $1,400 million results in a return on assets of 8.36%.

Investing activities are the acquiring and disposing of resources that an organization uses to acquire and sell its products or services.

Liabilities are owner claims on assets.

The accountant of Action Adventure Games prepared a balance sheet after every 10 day period.The only resources invested by its sole stockholder were at the start of the company on June 1.During June,the first month of operation,the following balance sheets were prepared: $\quad$ $\quad$ $\quad$ ACTION ADVENTURE GAMES Balance Sheet June 10 $\quad\quad\quad\quad\text { Assets}\quad\quad\quad\quad\quad\quad\text { Equity}$ Cash \ 60,000 Common stock. \ 60,000 Total liabilities and Total assets.. \6 0,000 equity \6 0,000 ACTION ADVENTURE GAMES Balance Sheet June 20 Assets Liabilities Cash. \ 48,000 Notes payable. \ 18,000 Land. 10,000 Equity Building. 20,000 Common stock. 60,000 Total liabilities and Total assets \ 78,000 equity \7 8,000 ACTION ADVENTURE GAMES Balance Sheet June 30 Assets Liabilities Cash. \ 51,000 Accounts payable. \ 2,000 Office supplies. 2,000 Notes payable. 18,000 Land. 10,000 Equity Building. 20,000 Common stock. 60,000 Retained earnings 3,000 Total liabilities and Total asset \ 83,000 equity \8 3,000 Required: Describe the nature of each of the four transactions that took place between the balance sheet dates shown.Assume only one transaction affected each account.

Match the following activities with the appropriate section of the statement of cash flows. -Cash received from a one-time sale of used office equipment.

Internal users include lenders,shareholders,brokers and nonexecutive employees.

Match the following terms with the appropriate definition. -Persons using accounting information who are directly involved in managing and operating the organization.

Match the following terms with the appropriate definition. -A model that asserts the factors that must exist for a person to commit fraud.