Question 1

The description of the relation between a company's assets, liabilities, and equity, which is expressed as Assets = Liabilities + Equity, is known as the:

Accepted Answer

A)  Income statement equation. 
B)  Accounting equation. 
C)  Business equation. 
D)  Return on equity ratio. 
E)  Net income. 
A)  Income statement equation. 
B)  Accounting equation. 
C)  Business equation. 
D)  Return on equity ratio. 
E)  Net income.

Question 2

Match between columns
                        Premises: Revenue recognition principle
Monetary unit principle
Business entity principle
Liabilities
Accounting equation
Statement of cash flows
Statement of retained earnings
Expenses
Business transaction

Accepted Answer

The Answer of A financial statement that reports the changes is...

Question 3

The owners of a partnership:

Accepted Answer

A)  Have created an entity that can also be called a sole proprietorship. 
B)  Have unlimited liability. 
C)  Have to have a written agreement in order to be legal. 
D)  Have created a legal organization separate from its owners. 
E)  Are called shareholders. 
A)  Have created an entity that can also be called a sole proprietorship. 
B)  Have unlimited liability. 
C)  Have to have a written agreement in order to be legal. 
D)  Have created a legal organization separate from its owners. 
E)  Are called shareholders.

Question 4

Net income:

Accepted Answer

A)  Decreases equity. 
B)  Represents the amount of assets owners put into a business. 
C)  Equals assets minus liabilities. 
D)  Is the excess of revenues over expenses. 
E)  Represents the owners' claims against assets. 
A)  Decreases equity. 
B)  Represents the amount of assets owners put into a business. 
C)  Equals assets minus liabilities. 
D)  Is the excess of revenues over expenses. 
E)  Represents the owners' claims against assets.

Question 5

The principle prescribing that financial statements 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 principle 
B)  Business entity principle 
C)  Objectivity principle 
D)  Cost principle 
E)  Monetary unit principle 
A)  Going-concern principle 
B)  Business entity principle 
C)  Objectivity principle 
D)  Cost principle 
E)  Monetary unit principle

Question 6

Explain the role of accounting in the information age.

Accepted Answer

Accounting is an information and measure

Question 7

FastForward has beginning equity of $257,000, net income of $51,000, dividends of $40,000, and investments by owners in exchange for stock of $6,000. Its ending equity is:

Accepted Answer

A)  $223,000 
B)  $240,000 
C)  $268,000 
D)  $274,000 
E)  $208,000 
A)  $223,000 
B)  $240,000 
C)  $268,000 
D)  $274,000 
E)  $208,000

Question 8

Creditors' claims on the assets of a company are called:

Accepted Answer

A)  Net losses 
B)  Expenses 
C)  Revenues 
D)  Equity 
E)  Liabilities 
A)  Net losses 
B)  Expenses 
C)  Revenues 
D)  Equity 
E)  Liabilities

Question 9

Recording the items on the financial statements in dollars is done because of the:

Accepted Answer

A)  Objectivity principle 
B)  Monetary unit principle 
C)  Revenue recognition principle 
D)  Going-concern principle 
E)  Cost principle 
A)  Objectivity principle 
B)  Monetary unit principle 
C)  Revenue recognition principle 
D)  Going-concern principle 
E)  Cost principle

Question 10

Discuss the relationship of risk to return.

Accepted Answer

Risk is the uncertainty about the amount

Question 11

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

Question 12

The International Accounting Standards Board (IASB) has the authority to impose its standards on companies around the world.

Accepted Answer

A) True 
 B)False

Question 13

If liabilities are $51,500 and assets are $173,425, then equity equals:

Accepted Answer

A)  $224,925 
B)  $51,500 
C)  $173,425 
D)  $121,925 
E)  $103,000 
A)  $224,925 
B)  $51,500 
C)  $173,425 
D)  $121,925 
E)  $103,000

Question 14

Fees earned (but not yet received in cash) by a business in exchange for services that it has provided appear on which of the following statements?

Accepted Answer

A)  Income statement 
B)  Statement of cash received 
C)  Statement of retained earnings 
D)  Statement of cash flows 
E)  Schedule of accounts receivable 
A)  Income statement 
B)  Statement of cash received 
C)  Statement of retained earnings 
D)  Statement of cash flows 
E)  Schedule of accounts receivable

Question 15

The organization that attempts to create more harmony among the accounting practices of different countries by identifying preferred practices and encouraging their worldwide acceptance is the:

Accepted Answer

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

Question 16

Which of the following statements is not true about assets?

Accepted Answer

A)  They are economic resources owned or controlled by the business. 
B)  They are expected to provide future benefits to the business. 
C)  They appear on the balance sheet. 
D)  They appear on the statement of retained earnings. 
E)  Claims on them are shared between creditors and owners. 
A)  They are economic resources owned or controlled by the business. 
B)  They are expected to provide future benefits to the business. 
C)  They appear on the balance sheet. 
D)  They appear on the statement of retained earnings. 
E)  Claims on them are shared between creditors and owners.

Question 17

How does the objectivity principle support ethical behavior?

Accepted Answer

The objectivity principle supports ethic

Question 18

A company's balance sheet shows: cash $22,000, accounts receivable $16,000, office equipment $50,000, and accounts payable $17,000. What is the amount of equity?

Accepted Answer

A)  $17,000 
B)  $29,000 
C)  $71,000 
D)  $88,000 
E)  $105,000 
A)  $17,000 
B)  $29,000 
C)  $71,000 
D)  $88,000 
E)  $105,000

Question 19

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

Accepted Answer

A) True 
 B)False

Question 20

Investing activities involve the buying and selling of assets such as land and equipment that are held for long-term use in the business.

Accepted Answer

A) True 
 B)False

The description of the relation between a company's assets, liabilities, and equity, which is expressed as Assets = Liabilities + Equity, is known as the:

The owners of a partnership:

Net income:

The principle prescribing that financial statements 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:

Explain the role of accounting in the information age.

FastForward has beginning equity of $257,000, net income of $51,000, dividends of $40,000, and investments by owners in exchange for stock of $6,000. Its ending equity is:

Creditors' claims on the assets of a company are called:

Recording the items on the financial statements in dollars is done because of the:

Discuss the relationship of risk to return.

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

The International Accounting Standards Board (IASB) has the authority to impose its standards on companies around the world.

If liabilities are $51,500 and assets are $173,425, then equity equals:

Fees earned (but not yet received in cash) by a business in exchange for services that it has provided appear on which of the following statements?

The organization that attempts to create more harmony among the accounting practices of different countries by identifying preferred practices and encouraging their worldwide acceptance is the:

Which of the following statements is not true about assets?

How does the objectivity principle support ethical behavior?

A company's balance sheet shows: cash $22,000, accounts receivable $16,000, office equipment $50,000, and accounts payable $17,000. What is the amount of equity?

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

Investing activities involve the buying and selling of assets such as land and equipment that are held for long-term use in the business.

Accounting for Transactions

Preparing Financial Statements

Accounting for Merchandising Operations

Accounting for Inventories

Accounting for Cash and Internal Controls

Accounting for Receivables

Accounting for Long-Term Assets

Accounting for Current Liabilities

Accounting for Long-Term Liabilities

Accounting for Equity

Accounting for Cash Flows

Interpreting Financial Statements

Time Value of Money

Investments and International Operations

Accounting for Partnerships

Accounting With Special Journals

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Exam 1: Introducing Financial Accounting

The description of the relation between a company's assets, liabilities, and equity, which is expressed as Assets = Liabilities + Equity, is known as the:

The owners of a partnership:

Net income:

The principle prescribing that financial statements 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:

Explain the role of accounting in the information age.

FastForward has beginning equity of $257,000, net income of $51,000, dividends of $40,000, and investments by owners in exchange for stock of $6,000. Its ending equity is:

Creditors' claims on the assets of a company are called:

Recording the items on the financial statements in dollars is done because of the:

Discuss the relationship of risk to return.

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

The International Accounting Standards Board (IASB) has the authority to impose its standards on companies around the world.

If liabilities are $51,500 and assets are $173,425, then equity equals:

Fees earned (but not yet received in cash) by a business in exchange for services that it has provided appear on which of the following statements?

The organization that attempts to create more harmony among the accounting practices of different countries by identifying preferred practices and encouraging their worldwide acceptance is the:

Which of the following statements is not true about assets?

How does the objectivity principle support ethical behavior?

A company's balance sheet shows: cash $22,000, accounts receivable $16,000, office equipment $50,000, and accounts payable $17,000. What is the amount of equity?

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

Investing activities involve the buying and selling of assets such as land and equipment that are held for long-term use in the business.

Accounting for Transactions

Preparing Financial Statements

Accounting for Merchandising Operations

Accounting for Inventories

Accounting for Cash and Internal Controls

Accounting for Receivables

Accounting for Long-Term Assets

Accounting for Current Liabilities

Accounting for Long-Term Liabilities

Accounting for Equity

Accounting for Cash Flows

Interpreting Financial Statements

Time Value of Money

Investments and International Operations

Accounting for Partnerships

Accounting With Special Journals

Filters