Question 1

The assumption that requires that a business be accounted for separately from its owners is the __________________ assumption.

Accepted Answer

The answer of The assumption that requires that a business...

Question 2

If Houston Company billed a client for $10,000 of consulting work completed,the accounts receivable asset increases by $10,000 and:

Accepted Answer

A) Accounts payable decreases $10,000. 
B) Accounts payable increases $10,000. 
C) Cash increases $10,000. 
D) Revenue increases $10,000. 
E) Revenue decreases $10,000 
A) Accounts payable decreases $10,000. 
B) Accounts payable increases $10,000. 
C) Cash increases $10,000. 
D) Revenue increases $10,000. 
E) Revenue decreases $10,000

Question 3

Identifying the proper ethical path is usually easy.

Accepted Answer

A) True 
 B)False

Question 4

____________ are the increases in equity from a company's sales of products and services to customers.

Accepted Answer

The answer of ____________ are the increases in equity from...

Question 5

The Superior Company acquired a building for $500,000.The building was appraised at a value of $575,000.The seller had paid $300,000 for the building 6 years ago.Which accounting principle would require Superior to record the building on its records at $500,000?

Accepted Answer

A) Monetary unit assumption. 
B) Going-concern assumption. 
C) Cost principle. 
D) Business entity assumption. 
E) Revenue recognition principle. 
A) Monetary unit assumption. 
B) Going-concern assumption. 
C) Cost principle. 
D) Business entity assumption. 
E) Revenue recognition principle.

Question 6

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 7

The income statement describes revenues earned and expenses incurred over a specified period of time due to earnings activities.

Accepted Answer

A) True 
 B)False

Question 8

The idea that a business will continue to operate instead of being closed or sold underlies the going-concern assumption.

Accepted Answer

A) True 
 B)False

Question 9

Owner financing refers to resources contributed by creditors or lenders.

Accepted Answer

A) True 
 B)False

Question 10

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 owner's equity. 
E) Financial Status Statement. 
A) Balance sheet. 
B) Income statement. 
C) Statement of cash flows. 
D) Statement of owner's equity. 
E) Financial Status Statement.

Question 11

A limited liability company offers the limited liability of a partnership or proprietorship and the tax treatment of a corporation.

Accepted Answer

A) True 
 B)False

Question 12

The area of accounting aimed at serving the decision making needs of internal users is:

Accepted Answer

A) Financial accounting. 
B) Managerial accounting. 
C) External auditing. 
D) SEC reporting. 
E) Bookkeeping. 
A) Financial accounting. 
B) Managerial accounting. 
C) External auditing. 
D) SEC reporting. 
E) Bookkeeping.

Question 13

The rule that requires financial statements to reflect the assumption that the business will continue operating instead of being closed or sold,unless evidence shows that it will not continue,is the:

Accepted Answer

A) Going-concern assumption. 
B) Business entity assumption. 
C) Objectivity principle. 
D) Cost Principle. 
E) Monetary unit assumption. 
A) Going-concern assumption. 
B) Business entity assumption. 
C) Objectivity principle. 
D) Cost Principle. 
E) Monetary unit assumption.

Question 14

The independent group that is attempting to harmonize accounting practices of different countries is the:

Accepted Answer

A) AICPA. 
B) IASB. 
C) CAP. 
D) SEC. 
E) FASB. 
A) AICPA. 
B) IASB. 
C) CAP. 
D) SEC. 
E) FASB.

Question 15

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 16

Accounts payable appear on which of the following statements?

Accepted Answer

A) Balance sheet. 
B) Income statement. 
C) Statement of owner's equity. 
D) Statement of cash flows. 
E) Transaction statement. 
A) Balance sheet. 
B) Income statement. 
C) Statement of owner's equity. 
D) Statement of cash flows. 
E) Transaction statement.

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

If the assets of a company increase by $55,000 during the year and its liabilities increase by $25,000 during the same year,then the change in equity of the company during the year must have been:

Accepted Answer

A) An increase of $80,000. 
B) A decrease of $80,000. 
C) An increase of $30,000. 
D) A decrease of $30,000. 
E) An increase of $25,000. 
A) An increase of $80,000. 
B) A decrease of $80,000. 
C) An increase of $30,000. 
D) A decrease of $30,000. 
E) An increase of $25,000.

Question 19

Use the following information as of December 31 to determine equity.

Accepted Answer

A) $57,000. 
B) $141,000. 
C) $297,000. 
D) $438,000. 
E) $579,000. 
A) $57,000. 
B) $141,000. 
C) $297,000. 
D) $438,000. 
E) $579,000.

Question 20

__________________ is an information and measurement system that identifies,records and communicates relevant,reliable and comparable information about an organization's economic activities.

Accepted Answer

The answer of __________________ is an information and measurement system...

Exam 1: Accounting in Business

The assumption that requires that a business be accounted for separately from its owners is the __________________ assumption.

If Houston Company billed a client for $10,000 of consulting work completed,the accounts receivable asset increases by $10,000 and:

Identifying the proper ethical path is usually easy.

____________ are the increases in equity from a company's sales of products and services to customers.

The Superior Company acquired a building for $500,000.The building was appraised at a value of $575,000.The seller had paid $300,000 for the building 6 years ago.Which accounting principle would require Superior to record the building on its records at $500,000?

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

The income statement describes revenues earned and expenses incurred over a specified period of time due to earnings activities.

The idea that a business will continue to operate instead of being closed or sold underlies the going-concern assumption.

Owner financing refers to resources contributed by creditors or lenders.

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):

A limited liability company offers the limited liability of a partnership or proprietorship and the tax treatment of a corporation.

The area of accounting aimed at serving the decision making needs of internal users is:

The rule that requires financial statements to reflect the assumption that the business will continue operating instead of being closed or sold,unless evidence shows that it will not continue,is the:

The independent group that is attempting to harmonize accounting practices of different countries is the:

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

Accounts payable appear on which of the following statements?

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

If the assets of a company increase by $55,000 during the year and its liabilities increase by $25,000 during the same year,then the change in equity of the company during the year must have been:

Use the following information as of December 31 to determine equity.

__________________ is an information and measurement system that identifies,records and communicates relevant,reliable and comparable information about an organization's economic activities.

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

Plant Assets, Natural Resources, and Intangibles

Current Liabilities and Payroll Accounting

Accounting for Partnerships

Accounting for Corporations

Long-Term Liabilities

Investments and International Operations

Reporting the Statement of Cash Flows

Analysis of Financial Statements

Managerial Accounting Concepts and Principles

Job Order Cost Accounting

Process Cost Accounting

Cost-Volume-Profit Analysis

Master Budgets and Planning

Flexible Budgets and Standard Costs

Performance Measurement and Responsibility Accounting

Capital Budgeting and Managerial Decisions

Appendix B: Time Value of Money

Appendix C: Activity-Based Costing

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