Question 1

Della's Donuts owner made investments of $50,000 and withdrawals of $20,000. The company has revenues of $83,000 and expenses of $64,000. Calculate its net income.

Accepted Answer

A)  $30,000. 
B)  $83,000. 
C)  $64,000. 
D)  $19,000. 
E)  $49,000. 
A)  $30,000. 
B)  $83,000. 
C)  $64,000. 
D)  $19,000. 
E)  $49,000.

Question 2

From the information given below, prepare a November income statement, a November statement of changes in equity, and a November 30 balance sheet. On November 1 of the current year, Lois Bell began Lois Bell, Interior Design with an initial investment of $50,000 cash. On November 30 her records showed the following (alphabetically arranged) items and amounts.

Accepted Answer

@#IMG-DLM& LOIS BELL, INTERIOR

Question 3

The following schedule reflects shows the first month's transactions of the Bill Blue Real Estate Company:
Provide descriptions for each transaction.

Accepted Answer

1. Investment of cash in business by own

Question 4

Identify the risk and the return in each of the following examples.
a. Investing $500 in a CD at 4.5% interest.
b. Placing a $100 bet on an NBA game.
c. Investing $10,000 in Microsoft shares.
d. Borrowing $20,000 in student loans.

Accepted Answer

a. The risk involved is that the investo

Question 5

______________________ is the recording of financial transactions and events, either manually or electronically.

Accepted Answer

Recordkeep

Question 6

What is the balance sheet? What is its purpose?

Accepted Answer

The balance sheet is a listing of the ty

Question 7

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

Accepted Answer

A) True 
 B)False

Question 8

The primary objective of financial accounting is:

Accepted Answer

A)  To serve the decision-making needs of internal users. 
B)  To provide financial statements to help external users analyze an organization's activities. 
C)  To monitor and control company activities. 
D)  To provide information on both the costs and benefits of looking after products and services. 
E)  To know what, when, and how much to produce. 
A)  To serve the decision-making needs of internal users. 
B)  To provide financial statements to help external users analyze an organization's activities. 
C)  To monitor and control company activities. 
D)  To provide information on both the costs and benefits of looking after products and services. 
E)  To know what, when, and how much to produce.

Question 9

Owners of a corporation are called shareholders or stockholders.

Accepted Answer

A) True 
 B)False

Question 10

Accounting is an information and measurement system that does all of the following except:

Accepted Answer

A)  Identifies business activities. 
B)  Records business activities. 
C)  Communicates business activities. 
D)  Does not use technology to improve accuracy in reporting. 
E)  Helps people make better decisions. 
A)  Identifies business activities. 
B)  Records business activities. 
C)  Communicates business activities. 
D)  Does not use technology to improve accuracy in reporting. 
E)  Helps people make better decisions.

Question 11

A limited partnership:

Accepted Answer

A)  Includes a general partner with unlimited liability. 
B)  Is subject to double taxation. 
C)  Has owners called sharesholders. 
D)  Is the same as a corporation. 
E)  May only have two partners. 
A)  Includes a general partner with unlimited liability. 
B)  Is subject to double taxation. 
C)  Has owners called sharesholders. 
D)  Is the same as a corporation. 
E)  May only have two partners.

Question 12

A payment to an owner is called a(n):

Accepted Answer

A)  Liability. 
B)  Withdrawal. 
C)  Expense. 
D)  Contribution. 
E)  Investment. 
A)  Liability. 
B)  Withdrawal. 
C)  Expense. 
D)  Contribution. 
E)  Investment.

Question 13

Increases in equity from a company's earnings activities are:

Accepted Answer

A)  Assets. 
B)  Revenues. 
C)  Liabilities. 
D)  Owner's Equity. 
E)  Expenses. 
A)  Assets. 
B)  Revenues. 
C)  Liabilities. 
D)  Owner's Equity. 
E)  Expenses.

Question 14

The four basic financial statements include the income statement (statement of comprehensive income), statement of changes in equity, balance sheet (statement of financial position), and statement of cash flows.

Accepted Answer

A) True 
 B)False

Question 15

External users include lenders, shareholders, customers, and regulators.

Accepted Answer

A) True 
 B)False

Question 16

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

Accepted Answer

A) True 
 B)False

Question 17

Bookkeeping is the recording of transactions and events and is only part of accounting.

Accepted Answer

A) True 
 B)False

Question 18

At the beginning of the year, a company had $120,000 worth of liabilities. During the year, assets increased by $160,000 and at year-end they equaled $360,000. Liabilities decreased $20,000 during the year. Calculate the beginning and ending values of equity.

Accepted Answer

Beginning equity = $

Question 19

External auditors examine financial statements to verify that they are prepared according to generally accepted accounting principles.

Accepted Answer

A) True 
 B)False

Question 20

Revenue is properly recognized:

Accepted Answer

A)  When the customer's order is received. 
B)  Only if the transaction creates an account receivable. 
C)  At the end of the accounting period. 
D)  Upon completion of the sale or when services have been performed and the business obtains the right to collect the sales price. 
E)  When cash from a sale is received. 
A)  When the customer's order is received. 
B)  Only if the transaction creates an account receivable. 
C)  At the end of the accounting period. 
D)  Upon completion of the sale or when services have been performed and the business obtains the right to collect the sales price. 
E)  When cash from a sale is received.

Exam 1: Accounting in Business

Della's Donuts owner made investments of $50,000 and withdrawals of $20,000. The company has revenues of $83,000 and expenses of $64,000. Calculate its net income.

The following schedule reflects shows the first month's transactions of the Bill Blue Real Estate Company: Provide descriptions for each transaction.

Identify the risk and the return in each of the following examples. a. Investing $500 in a CD at 4.5% interest. b. Placing a $100 bet on an NBA game. c. Investing $10,000 in Microsoft shares. d. Borrowing $20,000 in student loans.

______________________ is the recording of financial transactions and events, either manually or electronically.

What is the balance sheet? What is its purpose?

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

The primary objective of financial accounting is:

Owners of a corporation are called shareholders or stockholders.

Accounting is an information and measurement system that does all of the following except:

A limited partnership:

A payment to an owner is called a(n):

Increases in equity from a company's earnings activities are:

The four basic financial statements include the income statement (statement of comprehensive income), statement of changes in equity, balance sheet (statement of financial position), and statement of cash flows.

External users include lenders, shareholders, customers, and regulators.

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

Bookkeeping is the recording of transactions and events and is only part of accounting.

At the beginning of the year, a company had $120,000 worth of liabilities. During the year, assets increased by $160,000 and at year-end they equaled $360,000. Liabilities decreased $20,000 during the year. Calculate the beginning and ending values of equity.

External auditors examine financial statements to verify that they are prepared according to generally accepted accounting principles.

Revenue is properly recognized:

Analyzing and Recording Transactions

Adjusting Accounts and Preparing Financial Statements

Completing the Accounting Cycle

Accounting for Merchandising Operations

Inventories and Cost of Sales

Accounting Information Systems

Cash and Internal Controls

Accounting for Receivables

Long-Term Assets

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Accounting for Corporations

Long-Term Liabilities

Investments and International Operations

Statement of Cash Flows

Analysis of Financial Statements

Managerial Accounting Concepts and Principles

Job Order Cost Accounting

Process Cost Accounting

Cost Allocation and Performance Measurement

Cost-Volume-Profit Analysis

Master Budgets and Planning

Flexible Budgets and Standard Costs

Capital Budgeting and Managerial Decisions

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