Question 1

Companies prepare classified financial statements because they are required by international accounting principles.

Accepted Answer

A) True 
 B)False

Question 2

Identify whether the following investor questions are associated with a primary or b secondary financial reporting objectives.
-If I buy 50 shares of Apple, how much cash will I receive in dividends each year?

Accepted Answer

A) primary financial reporting objective 
B) secondary financial reporting objective

Question 3

All of the following are different expressions for net income except:

Accepted Answer

A)  Profits 
B)  Excess of revenues over expenses 
C)  Capital 
D)  Earnings

Question 4

From an ethical standpoint, if various alternatives are available to report a transaction, what are some of the questions an accountant should ask about the alternatives?

Accepted Answer

The answer of From an ethical standpoint, if various alternatives...

Question 5

Which of the following would not appear on an income statement?

Accepted Answer

A)  Sales revenue 
B)  Cost of goods sold 
C)  Accounts receivable 
D)  Insurance expense

Question 6

The current ratio is irrelevant in liquidity analysis for service companies because they do not have inventories among their current assets.

Accepted Answer

A) True 
 B)False

Question 7

Read the information about Fasoli, Inc.
Required:
Prepare the Assets section of the classified balance sheet.

Accepted Answer

The answer of Read the information about Fasoli, Inc.
Required:
Prepare the...

Question 8

The concept that assumes that an entity is not in the process of liquidation is .

Accepted Answer

The answer of The concept that assumes that an entity...

Question 9

Read the information about Fellsmere Corporation.
Required:
A Did Fellsmere's current ratio increase or decrease from 2013 to 2014? Make any necessary calculations and explain your answer. Which financial statement users are most concerned with this ratio?
B The balance sheets show a large increase in retained earnings during 2014. Identify the possible reasons for this increase.

Accepted Answer

The answer of Read the information about Fellsmere Corporation.
Required:
A Did...

Question 10

Presented below are condensed data from the financial statements of Snap Factory for 2015 and 2014. The figures are expressed in thousands. Use this information to answer the questions that follow.
  Required: How much of Snap Factory is financed by owners at the end of December of 2015?

Accepted Answer

The answer of Presented below are condensed data from the...

Question 11

In preparing the financial statements for December 31, 2015, an accountant improperly classified the payment of prepaid rent as rent expense. Which of the following amounts would not be affected by this improper classification?

Accepted Answer

A)  Retained earnings, January 1, 2015 
B)  Retained earnings, December 31, 2015 
C)  Net income 
D)  Total assets

Question 12

From the following list, select the proper section from the statement of cash flows in which it would be classified.
-Purchased equipment for cash

Accepted Answer

A) Operating Activities 
B) Investing Activities 
C) Financing Activities

Question 13

Wei Company reported the following items on its financial statements for the year ending December 31, 2015:  The income statement for Wei will report net income for the current year in the amount of

Accepted Answer

A)  $ 45,000 
B)  $ 65,000 
C)  $ 85,000 
D)  $ 465,000

Question 14

The following information is available from the records of Focus Seascapes, Inc. at the end of the 2014 calendar year:
  Required:
1. What is the total amount of Focus' assets at December 31, 2014?
2. What is the total amount of Owners' Equity at December 31, 2014?
3. What is the capital stock balance at December 31, 2014?

Accepted Answer

The answer of The following information is available from the...

Question 15

List the names of three companies with which you are familiar that are manufacturers or producers. Also list the names of three companies that are retailers. Finally, provide the names of three service providers.

Accepted Answer

The answer of List the names of three companies with...

Question 16

Which one of the following sections is least likely to be found in a corporate annual report?

Accepted Answer

A)  Notes to the Financial Statements 
B)  Forecasts of Cash Flows and Earnings 
C)  Report of the Independent Accountants 
D)  Management's Discussion and Analysis

Question 17

Match the following characteristics with the statements about each qualitative characteristic's importance.
-Those willing to spend the time should be provided with comprehensible accounting information.

Accepted Answer

A) Consistency 
B) Materiality 
C) Conservatism 
D) Comparability 
E) Reliability
F)Relevance
G)Understandability

Question 18

Below are several accounts from Costello Company's accounting records. Answer the questions that follow.
  A How much is the balance of retained earnings at the end of the year?
B Show the accounting equation for Costello Company at the end of the year with the respective dollar amounts.
C If stockholders' equity increases during the year, does that mean that the company is
profitable? Explain your answer.

Accepted Answer

The answer of Below are several accounts from Costello Company's...

Question 19

Read the information for Canyon Corporation. Determine the following amounts for Canyon Corporation.
A Total assets at the end of 2014.
  B Total liabilities at the end of 2014.
  C Total equity at the end of 2014.

Accepted Answer

The answer of Read the information for Canyon Corporation. Determine...

Question 20

The following accounting principles and assumptions are included in the conceptual framework of accounting:
  For each situation in A through C below, identify which assumption or principle applies by selecting from the list pro why that assumption or principle applies.
A Global Corp. has divisions in several countries around the world. Each of these countries has a currency different from the U.S.dollar. Global Corp. is a U.S. company and must include the financial data of its worldwide divisions in its financial stat
B Steve and Mike operate a security business as a partnership. They are considering the advantages of changing over to the corporate form of business.
C Island Pasta is a locally owned and operated fast-food business. The owners have decided to expand into nearby cities. Expansion will require more capital, but management does not expect it will stay in business for more than a year or so regardless if it expands or not.

Accepted Answer

The answer of The following accounting principles and assumptions are...

Exam 1: Accounting As a Form of Communication

Companies prepare classified financial statements because they are required by international accounting principles.

Identify whether the following investor questions are associated with a primary or b secondary financial reporting objectives. -If I buy 50 shares of Apple, how much cash will I receive in dividends each year?

All of the following are different expressions for net income except:

From an ethical standpoint, if various alternatives are available to report a transaction, what are some of the questions an accountant should ask about the alternatives?

Which of the following would not appear on an income statement?

The current ratio is irrelevant in liquidity analysis for service companies because they do not have inventories among their current assets.

Read the information about Fasoli, Inc. Required: Prepare the Assets section of the classified balance sheet.

The concept that assumes that an entity is not in the process of liquidation is .

Presented below are condensed data from the financial statements of Snap Factory for 2015 and 2014. The figures are expressed in thousands. Use this information to answer the questions that follow. Required: How much of Snap Factory is financed by owners at the end of December of 2015?

In preparing the financial statements for December 31, 2015, an accountant improperly classified the payment of prepaid rent as rent expense. Which of the following amounts would not be affected by this improper classification?

From the following list, select the proper section from the statement of cash flows in which it would be classified. -Purchased equipment for cash

Wei Company reported the following items on its financial statements for the year ending December 31, 2015: The income statement for Wei will report net income for the current year in the amount of

List the names of three companies with which you are familiar that are manufacturers or producers. Also list the names of three companies that are retailers. Finally, provide the names of three service providers.

Which one of the following sections is least likely to be found in a corporate annual report?

Match the following characteristics with the statements about each qualitative characteristic's importance. -Those willing to spend the time should be provided with comprehensible accounting information.

Read the information for Canyon Corporation. Determine the following amounts for Canyon Corporation. A Total assets at the end of 2014. B Total liabilities at the end of 2014. C Total equity at the end of 2014.