Question 1

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 usersF) Certified Public Accountant (CP
A)  G) Financial accountingH) AccountingI) RecordkeepingJ) A) and H)
K) D) and I)

Question 2

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

Accepted Answer

A) True 
 B)False

Question 3

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

Accepted Answer

A) True 
 B)False

Question 4

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.F) B) and E)
G) A) and B)

Question 5

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.F) C) and E)
G) C) and D)

Question 6

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.F) A) and B)
G) A) and D)

Question 7

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.F) A) and C)
G) A) and B)

Question 8

The balance sheet is based on the accounting equation.

Accepted Answer

A) True 
 B)False

Question 9

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.F) A) and D)
G) B) and C)

Question 10

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.F) A) and E)
G) A) and C)

Question 11

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

Accepted Answer

A) True 
 B)False

Question 12

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.F) All of the above
G) C) and E)

Question 13

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.F) B) and D)
G) D) and E)

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.F) All of the above
G) A) and D)

Question 15

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.K) D) and H)
L) A) and E)

Question 16

Owners of a corporation are called shareholders or stockholders.

Accepted Answer

A) True 
 B)False

Question 17

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

Accepted Answer

A) True 
 B)False

Question 18

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 19

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

Accepted Answer

Record-kee...

Question 20

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.F) A) and B)
G) A) and C)

Exam 1: Accounting in Business

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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) :

Correct Answer
verified

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

Correct Answer
verified
Record-kee...
View Answer

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

U.S.government bonds are:

Correct Answer
verified

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

Correct Answer
verified

Owners of a corporation are called shareholders or stockholders.

Correct Answer
verified

The business entity assumption:

Correct Answer
verified

The balance sheet is based on the accounting equation.

Correct Answer
verified

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

Correct Answer
verified

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

Correct Answer
verified

Correct Answer
verified
None...
View Answer

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

Correct Answer
verified

All of the following are true regarding ethics except:

Correct Answer
verified

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

Correct Answer
verified

Exam 1: Accounting in Business

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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) :

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedRecord-kee...View AnswerShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

U.S.government bonds are:

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Owners of a corporation are called shareholders or stockholders.

Correct AnswerverifiedShow Answer

The business entity assumption:

Correct AnswerverifiedShow Answer

The balance sheet is based on the accounting equation.

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Correct AnswerverifiedNone...View AnswerShow Answer

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

Correct AnswerverifiedShow Answer

All of the following are true regarding ethics except:

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
Record-kee...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
None...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified