Exam 15: Understanding Accounting and Financial Statements

Jones Corp)an apparel company,has total assets worth $8,500.The owners' initial investment in Jones Corp.stood at $4,000,and profits that were not paid out to owners over time was at $2,000.Calculate the total liabilities.

The procedure used by accountants to convert data about individual transactions to financial statements is called

Accountants play a role in all three business activities: financing,investing,and operating.

_____ activities focus on selling goods and services.

When examining a statement of cash flows,investors obtain relevant information about a firm's cash receipts and payments for its operations,investments,and financing during an accounting period.

The language of business is accounting.

Lambert manages the sales force for his company.He is engaged in the _____ activity.

All of the following are assets EXCEPT

The three principal financial statements are the balance sheet,income statement,and the statement of retained earnings.

The budget establishes the standards with which actual performance may be compared.

Cumberland Fabrication has $80 million in assets and $50 million in owners' equity.How much does the firm have in liabilities?

Leonardo,chief financial officer for a company,wants to take a look at the summary of expenses,revenues,and profits of the firm for the most recent quarter.He can best find this information by consulting the

The balance sheet is based on the accounting equation.

A budget is essentially a long-term financial plan.

The assets seen in a balance sheet are in descending order of

Amelia asked her accountant to prepare a summary of the company's "bottom line." What specific information is Amelia interested in?

Salman performs professional services similar to those of a management accountant while working for the city of Portland.Salman can best be described as a

Return on equity is a profitability ratio.

Fernando is not an employee of the Edith Corporation,but he was hired as a management consultant to provide unbiased advice about Edith Corporation's financial condition.Fernando is a(n)

A(n)_______ is anything of value owned or leased by a business.