Question 1

The financial statement that reports whether the business earned a profit and also lists the revenues and expenses is called the:

Accepted Answer

A)  Balance sheet. 
B)  Statement of retained earnings. 
C)  Statement of cash flows. 
D)  Income statement. 
E)  Statement of financial position. 
A)  Balance sheet. 
B)  Statement of retained earnings. 
C)  Statement of cash flows. 
D)  Income statement. 
E)  Statement of financial position.

Question 2

A company acquires equipment for $75,000 cash.This represents a(n):

Accepted Answer

A)  Operating activity. 
B)  Investing activity. 
C)  Financing activity. 
D)  Revenue activity. 
E)  Expense activity. 
A)  Operating activity. 
B)  Investing activity. 
C)  Financing activity. 
D)  Revenue activity. 
E)  Expense activity.

Question 3

In a business decision where there are ethical concerns,the preferred course of action should be one that:

Accepted Answer

A)  Is agreed upon by the most managers. 
B)  Maximizes the company's profits. 
C)  Results in maintaining operations at the current level. 
D)  Costs the least to implement. 
E)  Avoids casting doubt on the decision maker and upholds trust. 
A)  Is agreed upon by the most managers. 
B)  Maximizes the company's profits. 
C)  Results in maintaining operations at the current level. 
D)  Costs the least to implement. 
E)  Avoids casting doubt on the decision maker and upholds trust.

Question 4

Distributions of cash or other resources by a business to its stockholders are called:

Accepted Answer

A)  Dividends. 
B)  Expenses. 
C)  Assets. 
D)  Retained earnings. 
E)  Net Income. 
A)  Dividends. 
B)  Expenses. 
C)  Assets. 
D)  Retained earnings. 
E)  Net Income.

Question 5

A sole proprietorship is a business owned by one or more persons.

Accepted Answer

A) True 
 B)False

Question 6

A financial statement providing information that helps users understand a company's financial status,and which lists the types and amounts of assets,liabilities,and equity as of a specific date,is called a(n):

Accepted Answer

A)  Balance sheet. 
B)  Income statement. 
C)  Statement of cash flows. 
D)  Statement of retained earnings. 
E)  Financial Status Statement. 
A)  Balance sheet. 
B)  Income statement. 
C)  Statement of cash flows. 
D)  Statement of retained earnings. 
E)  Financial Status Statement.

Question 7

The accounting equation can be restated as: Assets - Equity = Liabilities.

Accepted Answer

A) True 
 B)False

Question 8

Match the following terms with the appropriate definition.
-Securities and Exchange Commission

Accepted Answer

A) The governmental agency that has the legal authority to establish accounting rules. 
B) Prescribes that assets and services to be recorded initially on a cash or equal-to-cash basis. 
C) A report that describes a company's financial position at a point in time. 
D) A financial statement that reports the changes in equity over the reporting period; including increases from net income and decreases from dividends or net losses. 
E) The concepts and rules that govern financial accounting.
F)A report that identifies cash receipts and cash payments over a period of time.
G)A principle that requires the information in financial statements to be supported by independent unbiased evidence.
H)An independent group consisting of individuals from many countries that identify preferred accounting practices.
I)Presumes that the life of a company can be divided into periods for reporting purposes.
J)Prescribes that a company report the details behind financial statements that would impact user decisions. 
A) The governmental agency that has the legal authority to establish accounting rules. 
B) Prescribes that assets and services to be recorded initially on a cash or equal-to-cash basis. 
C) A report that describes a company's financial position at a point in time. 
D) A financial statement that reports the changes in equity over the reporting period; including increases from net income and decreases from dividends or net losses. 
E) The concepts and rules that govern financial accounting.
F)A report that identifies cash receipts and cash payments over a period of time.
G)A principle that requires the information in financial statements to be supported by independent unbiased evidence.
H)An independent group consisting of individuals from many countries that identify preferred accounting practices.
I)Presumes that the life of a company can be divided into periods for reporting purposes.
J)Prescribes that a company report the details behind financial statements that would impact user decisions.

Question 9

________,which is one part of accounting,is the recording of transactions and events,either manually or electronically.

Accepted Answer

Record-kee

Question 10

The statement of cash flows reports all of the following except:

Accepted Answer

A)  Cash flows from operating activities. 
B)  Cash flows from investing activities. 
C)  Cash flows from financing activities. 
D)  The net increase or decrease in assets for the period reported. 
E)  The net increase or decrease in cash for the period reported. 
A)  Cash flows from operating activities. 
B)  Cash flows from investing activities. 
C)  Cash flows from financing activities. 
D)  The net increase or decrease in assets for the period reported. 
E)  The net increase or decrease in cash for the period reported.

Question 11

The business entity assumption:

Accepted Answer

A)  Means that accounting information reflects a presumption that the business will continue operating instead of being closed or sold. 
B)  Means that we can express transactions and events in monetary, or money, units. 
C)  Presumes that the life of a company can be divided into time periods, such as months and years, and that useful reports can be prepared for those periods. 
D)  Means that a business is accounted for separately from other business entities, including its owners. 
E)  Prescribes that a company record the expenses it incurred to generate the revenue reported. 
A)  Means that accounting information reflects a presumption that the business will continue operating instead of being closed or sold. 
B)  Means that we can express transactions and events in monetary, or money, units. 
C)  Presumes that the life of a company can be divided into time periods, such as months and years, and that useful reports can be prepared for those periods. 
D)  Means that a business is accounted for separately from other business entities, including its owners. 
E)  Prescribes that a company record the expenses it incurred to generate the revenue reported.

Question 12

Owners of a corporation are called shareholders or stockholders.

Accepted Answer

A) True 
 B)False

Question 13

Assets are the resources a company owns or controls that are expected to yield future benefits.

Accepted Answer

A) True 
 B)False

Question 14

All of the following are true regarding ethics except:

Accepted Answer

A)  Ethics are beliefs that distinguish right from wrong. 
B)  Ethics rules are often set for CPAs. 
C)  Ethics do not affect the operations or outcome of a company. 
D)  Are critical in accounting. 
E)  Ethics can be difficult to apply. 
A)  Ethics are beliefs that distinguish right from wrong. 
B)  Ethics rules are often set for CPAs. 
C)  Ethics do not affect the operations or outcome of a company. 
D)  Are critical in accounting. 
E)  Ethics can be difficult to apply.

Question 15

Match the following terms with the appropriate definition.
-Persons using accounting information who are not directly involved in running the organization.

Accepted Answer

A) Internal users 
B) Fraud triangle 
C) Managerial accounting 
D) Ethics 
E) External users
F)Certified Public Accountant (CP
A) 
G)Financial accounting
H)Accounting
I)Recordkeeping 
A) Internal users 
B) Fraud triangle 
C) Managerial accounting 
D) Ethics 
E) External users
F)Certified Public Accountant (CP
A) 
G)Financial accounting
H)Accounting
I)Recordkeeping

Question 16

U.S.government 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 17

Prepare a December 31 balance sheet in proper form for Smokey River Supplies from the following list of the accounts:
 $\begin{array}{llr}
  \text { Cash } &\$10,000\
 \text { Accounts receivable } &8,000\
 \text {  Supplies} &12,000\
 \text {  Equipment} &35,000\
 \text {  Land} &18,000\
 \text { Accounts payable } &13,000\
 \text { Notes payable } &41,000\
 \text { Common stock } &20,000\
 \text {  Retained earnings} &9,000\
\end{array}$

Accepted Answer

None

Question 18

The three common forms of business ownership include sole proprietorship,partnership,and non-profit.

Accepted Answer

A) True 
 B)False

Question 19

The balance sheet is based on the accounting equation.

Accepted Answer

A) True 
 B)False

Question 20

Which of the following combinations results in a net loss reported on the income statement?

Accepted Answer

A)  Total revenues of $80,000 and total expenses of $74,000. 
B)  Total revenues of $70,000 and total expenses of $74,000. 
C)  Total revenues of $60,000 and total expenses of $52,000. 
D)  Total revenues of $20,000 and total expenses of $16,000. 
E)  Total revenues of $40,000 and total expenses of $31,000. 
A)  Total revenues of $80,000 and total expenses of $74,000. 
B)  Total revenues of $70,000 and total expenses of $74,000. 
C)  Total revenues of $60,000 and total expenses of $52,000. 
D)  Total revenues of $20,000 and total expenses of $16,000. 
E)  Total revenues of $40,000 and total expenses of $31,000.

The financial statement that reports whether the business earned a profit and also lists the revenues and expenses is called the:

A company acquires equipment for $75,000 cash.This represents a(n):

In a business decision where there are ethical concerns,the preferred course of action should be one that:

Distributions of cash or other resources by a business to its stockholders are called:

A sole proprietorship is a business owned by one or more persons.

A financial statement providing information that helps users understand a company's financial status,and which lists the types and amounts of assets,liabilities,and equity as of a specific date,is called a(n):

The accounting equation can be restated as: Assets - Equity = Liabilities.

Match the following terms with the appropriate definition. -Securities and Exchange Commission

________,which is one part of accounting,is the recording of transactions and events,either manually or electronically.

The statement of cash flows reports all of the following except:

The business entity assumption:

Owners of a corporation are called shareholders or stockholders.

Assets are the resources a company owns or controls that are expected to yield future benefits.

All of the following are true regarding ethics except:

Match the following terms with the appropriate definition. -Persons using accounting information who are not directly involved in running the organization.

U.S.government bonds are:

Prepare a December 31 balance sheet in proper form for Smokey River Supplies from the following list of the accounts: Cash \1 0,000 Accounts receivable 8,000 Supplies 12,000 Equipment 35,000 Land 18,000 Accounts payable 13,000 Notes payable 41,000 Common stock 20,000 Retained earnings 9,000

The three common forms of business ownership include sole proprietorship,partnership,and non-profit.

The balance sheet is based on the accounting equation.

Which of the following combinations results in a net loss reported on the income statement?

Analyzing 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

Time Value of Money

Investments

Partnership Accounting

Filters

Exam 1: Accounting in Business

The financial statement that reports whether the business earned a profit and also lists the revenues and expenses is called the:

A company acquires equipment for $75,000 cash.This represents a(n):

In a business decision where there are ethical concerns,the preferred course of action should be one that:

Distributions of cash or other resources by a business to its stockholders are called:

A sole proprietorship is a business owned by one or more persons.

A financial statement providing information that helps users understand a company's financial status,and which lists the types and amounts of assets,liabilities,and equity as of a specific date,is called a(n):

The accounting equation can be restated as: Assets - Equity = Liabilities.

Match the following terms with the appropriate definition. -Securities and Exchange Commission

________,which is one part of accounting,is the recording of transactions and events,either manually or electronically.

The statement of cash flows reports all of the following except:

The business entity assumption:

Owners of a corporation are called shareholders or stockholders.

Assets are the resources a company owns or controls that are expected to yield future benefits.

All of the following are true regarding ethics except:

Match the following terms with the appropriate definition. -Persons using accounting information who are not directly involved in running the organization.

U.S.government bonds are:

Prepare a December 31 balance sheet in proper form for Smokey River Supplies from the following list of the accounts: Cash \1 0,000 Accounts receivable 8,000 Supplies 12,000 Equipment 35,000 Land 18,000 Accounts payable 13,000 Notes payable 41,000 Common stock 20,000 Retained earnings 9,000

The three common forms of business ownership include sole proprietorship,partnership,and non-profit.

The balance sheet is based on the accounting equation.

Which of the following combinations results in a net loss reported on the income statement?

Analyzing 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

Time Value of Money

Investments

Partnership Accounting

Filters