Exam 1: Introducing Financial Statements

Grandmark Printing pays $2,000 rent to the landlord of the building where its facilities are located.How does this transaction affect the accounting equation for Grandmark?

Identify and describe the four basic financial statements:

Flitter reported net income of $17,500 for the past year.At the beginning of the year the company had $200,000 in assets and $50,000 in liabilities.By the end of the year,assets had increased to $300,000 and liabilities were $75,000.Calculate its return on assets:

Congress passed the Dodd-Frank Wall Street Reform and Consumer Protection Act (or Dodd-Frank)to:

Net income occurs when revenues exceed expenses.

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

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

Which of the following combinations does not result in the same amount of net income reported on the income statement?

Which of the following accounting principles prescribes that a company record its expenses incurred to generate the revenue reported?

Identify the users and uses of accounting information.

Identify the three basic forms of business organizations and their key attributes.

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 measurement principle is also known as the cost principle.

The financial statement that identifies a company's cash receipts and cash payments over a period of time is the:

If a company is considering the purchase of a parcel of land that was acquired by the seller for $85,000,is offered for sale at $150,000,is assessed for tax purposes at $95,000,is recognized by the purchaser as easily being worth $140,000,and is purchased for $137,000,the land should be recorded in the purchaser's books at:

Which of the following accounting principles require that all goods and services purchased be recorded at actual cost?

Creditors' claims on assets that reflect company obligations to provide assets,products,or services to others are called ________.

Rushing had income of $144 million and average invested assets of $1,800 million.Its return on assets is:

If a company paid $38,000 of its accounts payable in cash,what was the effect on the accounting equation?

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?