Question 1

When analyzing a company's income statement,a fact to remember is that:

Accepted Answer

A) the cost of products sold is another term for gross profit. 
B) operating expenses are the costs of everyday operations such as selling expenses. 
C) companies are not allowed to offset items such as interest income and interest expense against each other. 
D) all expenses will have the word expense after their titles. 
A) the cost of products sold is another term for gross profit. 
B) operating expenses are the costs of everyday operations such as selling expenses. 
C) companies are not allowed to offset items such as interest income and interest expense against each other. 
D) all expenses will have the word expense after their titles. B

Question 2

A partnership is a taxpaying entity.

Accepted Answer

A) True 
 B)False  False

Question 3

Accumulated depreciation is normally associated with which asset on the Balance Sheet?

Accepted Answer

A) inventory 
B) accounts receivable 
C) intangible assets 
D) fixed assets 
A) inventory 
B) accounts receivable 
C) intangible assets 
D) fixed assets D

Question 4

The principle stating that assets acquired by the business should be recorded at their actual cost on the date of purchase is:

Accepted Answer

A) historical cost. 
B) objectivity. 
C) reliability. 
D) stable-monetary-unit. 
A) historical cost. 
B) objectivity. 
C) reliability. 
D) stable-monetary-unit.

Question 5

The SEC establishes International Financial Reporting Standards.

Accepted Answer

A) True 
 B)False

Question 6

If a company prepares its financial statements three years after the end of its accounting period,it has violated the qualitative characteristic of:

Accepted Answer

A) understandability. 
B) timeliness. 
C) verifiability. 
D) materiality. 
A) understandability. 
B) timeliness. 
C) verifiability. 
D) materiality.

Question 7

The major types of transactions that affect retained earnings are:

Accepted Answer

A) paid-in capital and common stock. 
B) assets and liabilities. 
C) revenues,expenses,and dividends. 
D) revenues and liabilities. 
A) paid-in capital and common stock. 
B) assets and liabilities. 
C) revenues,expenses,and dividends. 
D) revenues and liabilities.

Question 8

A company's balance sheet:

Accepted Answer

A) is dated for a period of time. 
B) has three main categories of assets. 
C) has two main categories of liabilities. 
D) lists liabilities before assets. 
A) is dated for a period of time. 
B) has three main categories of assets. 
C) has two main categories of liabilities. 
D) lists liabilities before assets.

Question 9

At the end of the current fiscal year,ABC Corporation had the following balances:
   What is the increase (or decrease)to Retained Earnings? Support your answer with well labeled computations.

Accepted Answer

The following accoun

Question 10

Which financial statement answers the following question: What is the company's financial position at fiscal year end?

Accepted Answer

A) statement of cash flows 
B) income statement 
C) statement of retained earnings 
D) balance sheet 
A) statement of cash flows 
B) income statement 
C) statement of retained earnings 
D) balance sheet

Question 11

Accounting:

Accepted Answer

A) measures business activities. 
B) processes data into reports and communicates the data to decision makers. 
C) is often called the language of business. 
D) is all of the above. 
A) measures business activities. 
B) processes data into reports and communicates the data to decision makers. 
C) is often called the language of business. 
D) is all of the above.

Question 12

The cost of products sold:

Accepted Answer

A) is considered a selling expense. 
B) is the direct cost of the products sold. 
C) is classified as revenue on the income statement. 
D) is the same as total revenues. 
A) is considered a selling expense. 
B) is the direct cost of the products sold. 
C) is classified as revenue on the income statement. 
D) is the same as total revenues.

Question 13

The owner of a ________ is personally liable for all the business's debts.

Accepted Answer

A) proprietorship 
B) corporation 
C) limited-liability company 
D) All of the above are correct. 
A) proprietorship 
B) corporation 
C) limited-liability company 
D) All of the above are correct.

Question 14

When total expenses exceed total revenues,the result is:

Accepted Answer

A) a net profit. 
B) a net loss. 
C) a dividend. 
D) an increase to retained earnings. 
A) a net profit. 
B) a net loss. 
C) a dividend. 
D) an increase to retained earnings.

Question 15

Expenses of a business include:

Accepted Answer

A) sales and cash equivalents. 
B) common stock and rent expense. 
C) cost of products and services sold and salaries expense. 
D) retained earnings and utilities expense. 
A) sales and cash equivalents. 
B) common stock and rent expense. 
C) cost of products and services sold and salaries expense. 
D) retained earnings and utilities expense.

Question 16

Owners of an LLC are called:

Accepted Answer

A) partners. 
B) proprietors. 
C) members. 
D) stockholders. 
A) partners. 
B) proprietors. 
C) members. 
D) stockholders.

Question 17

All of the following are expenses EXCEPT for:

Accepted Answer

A) Cost of products and services. 
B) Depreciation Expense. 
C) Salary Expense. 
D) Dividends. 
A) Cost of products and services. 
B) Depreciation Expense. 
C) Salary Expense. 
D) Dividends.

Question 18

To be useful,accounting information must have the fundamental qualitative characteristics of:

Accepted Answer

A) comparability and relevance. 
B) relevance and faithful representation. 
C) materiality and understandability. 
D) faithful representation and timeliness. 
A) comparability and relevance. 
B) relevance and faithful representation. 
C) materiality and understandability. 
D) faithful representation and timeliness.

Question 19

Which type of business organization transacts much more business and is larger in terms of assets,income,and number of employees?

Accepted Answer

A) proprietorship 
B) partnership 
C) limited-liability company 
D) corporation 
A) proprietorship 
B) partnership 
C) limited-liability company 
D) corporation

Question 20

Which of the following statements is FALSE?

Accepted Answer

A) The application of U.S.GAAP for public companies in the Unites States has been overseen by SEC. 
B) The advantage of a uniform set of global accounting standards is that financial statements from a U.S.company will be comparable to those of a foreign company. 
C) In the long run,a uniform set of global accounting standards should significantly reduce the costs of doing business globally. 
D) IFRS has been adapted in the United States. 
A) The application of U.S.GAAP for public companies in the Unites States has been overseen by SEC. 
B) The advantage of a uniform set of global accounting standards is that financial statements from a U.S.company will be comparable to those of a foreign company. 
C) In the long run,a uniform set of global accounting standards should significantly reduce the costs of doing business globally. 
D) IFRS has been adapted in the United States.

When analyzing a company's income statement,a fact to remember is that:

A partnership is a taxpaying entity.

Accumulated depreciation is normally associated with which asset on the Balance Sheet?

The principle stating that assets acquired by the business should be recorded at their actual cost on the date of purchase is:

The SEC establishes International Financial Reporting Standards.

If a company prepares its financial statements three years after the end of its accounting period,it has violated the qualitative characteristic of:

The major types of transactions that affect retained earnings are:

A company's balance sheet:

At the end of the current fiscal year,ABC Corporation had the following balances: What is the increase (or decrease)to Retained Earnings? Support your answer with well labeled computations.

Which financial statement answers the following question: What is the company's financial position at fiscal year end?

Accounting:

The cost of products sold:

The owner of a ________ is personally liable for all the business's debts.

When total expenses exceed total revenues,the result is:

Expenses of a business include:

Owners of an LLC are called:

All of the following are expenses EXCEPT for:

To be useful,accounting information must have the fundamental qualitative characteristics of:

Which type of business organization transacts much more business and is larger in terms of assets,income,and number of employees?

Which of the following statements is FALSE?

Transaction Analysis

Accrual Accounting Income

Internal Control Cash

Receivables and Revenue

Inventory Cost of Goods Sold

Plant Assets, natural Resources, Intangibles

Current and Contingent Liabilities

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Investments

Time Value of Money

Filters

Exam 1: The Financial Statements

When analyzing a company's income statement,a fact to remember is that:

A partnership is a taxpaying entity.

Accumulated depreciation is normally associated with which asset on the Balance Sheet?

The principle stating that assets acquired by the business should be recorded at their actual cost on the date of purchase is:

The SEC establishes International Financial Reporting Standards.

If a company prepares its financial statements three years after the end of its accounting period,it has violated the qualitative characteristic of:

The major types of transactions that affect retained earnings are:

A company's balance sheet:

At the end of the current fiscal year,ABC Corporation had the following balances: What is the increase (or decrease)to Retained Earnings? Support your answer with well labeled computations.

Which financial statement answers the following question: What is the company's financial position at fiscal year end?

Accounting:

The cost of products sold:

The owner of a ________ is personally liable for all the business's debts.

When total expenses exceed total revenues,the result is:

Expenses of a business include:

Owners of an LLC are called:

All of the following are expenses EXCEPT for:

To be useful,accounting information must have the fundamental qualitative characteristics of:

Which type of business organization transacts much more business and is larger in terms of assets,income,and number of employees?

Which of the following statements is FALSE?

Transaction Analysis

Accrual Accounting Income

Internal Control Cash

Receivables and Revenue

Inventory Cost of Goods Sold

Plant Assets, natural Resources, Intangibles

Current and Contingent Liabilities

Long-Term Liabilities

Stockholders Equity

The Statement of Cash Flows

Financial Statement Analysis

Investments

Time Value of Money

Filters