Question 1

An example of an operating activity is:

Accepted Answer

A)  Paying wages. 
B)  Purchasing office equipment. 
C)  Borrowing money from a bank. 
D)  Selling stock. 
E)  Paying off a loan. 
A)  Paying wages. 
B)  Purchasing office equipment. 
C)  Borrowing money from a bank. 
D)  Selling stock. 
E)  Paying off a loan.

Question 2

Which of the following elements are found on the income statement?

Accepted Answer

A)  Cash 
B)  Accounts receivable 
C)  Common stock 
D)  Retained earnings 
E)  Salaries expense 
A)  Cash 
B)  Accounts receivable 
C)  Common stock 
D)  Retained earnings 
E)  Salaries expense

Question 3

Which of the following is the primary purpose of accounting?

Accepted Answer

A)  To establish a business. 
B)  To identify, record, and communicate business transactions. 
C)  To earn a large profit. 
D)  To reduce taxes owed for the business. 
E)  To establish credit for a company. 
A)  To establish a business. 
B)  To identify, record, and communicate business transactions. 
C)  To earn a large profit. 
D)  To reduce taxes owed for the business. 
E)  To establish credit for a company.

Question 4

Della's Donuts has revenues of $83,000 and expenses of $64,000. Calculate its net income.

Accepted Answer

Net income

Question 5

Identify the risk and the return in each of the following examples:
A. Investing $500 in a CD at 4.5% interest.
B. Placing a $100 bet on an NBA game.
C. Investing $10,000 in Microsoft stock.
D. Borrowing $20,000 in student loans.

Accepted Answer

A. The risk involved is that the investo

Question 6

Why should assets be recorded at historical cost?

Accepted Answer

Assets should be recorded at h

Question 7

Cool Tours had beginning equity of $72,000, net income of $25,000, and dividends of $9,000. Calculate the ending equity.

Accepted Answer

Ending equity = $72,

Question 8

If the assets of a business increased $89,000 during a period of time and its liabilities increased $67,000 during the same period, equity in the business must have:

Accepted Answer

A)  Increased $22,000 
B)  Decreased $22,000 
C)  Increased $89,000 
D)  Decreased $156,000 
E)  Increased $156,000 
A)  Increased $22,000 
B)  Decreased $22,000 
C)  Increased $89,000 
D)  Decreased $156,000 
E)  Increased $156,000

Question 9

FastForward had cash inflows from operations of $62,500; cash outflows from investing activities of $47,000; and cash inflows from financing of $25,000. The net change in cash was:

Accepted Answer

A)  $40,500 increase 
B)  $40,500 decrease 
C)  $134,500 decrease 
D)  $134,000 increase 
E)  $9,500 increase 
A)  $40,500 increase 
B)  $40,500 decrease 
C)  $134,500 decrease 
D)  $134,000 increase 
E)  $9,500 increase

Question 10

Revenues are:

Accepted Answer

A)  The same as net income. 
B)  The excess of expenses over assets. 
C)  Resources owned or controlled by a company. 
D)  Increases in retained earnings from a company's earning activities. 
E)  The costs of assets or services used. 
A)  The same as net income. 
B)  The excess of expenses over assets. 
C)  Resources owned or controlled by a company. 
D)  Increases in retained earnings from a company's earning activities. 
E)  The costs of assets or services used.

Question 11

The records of Skymaster Airplane Rentals show the following information as of December 31, 2014:
   Dividends of $52,000 were paid during 2014.
Using the above information, prepare a balance sheet at December 31, 2014.

Accepted Answer

The answer of The records of Skymaster Airplane Rentals show...

Question 12

What is the balance sheet? What is its purpose?

Accepted Answer

The balance sheet is a listing of the ty

Question 13

The objectivity principle:

Accepted Answer

A)  Means that information is supported by independent, unbiased evidence. 
B)  Means that information can be based on what the preparer thinks is true. 
C)  Means that financial statement should contain information that is optimistic. 
D)  Means that a business may not recognize revenue until cash is received. 
E)  Means the assets acquired must be recorded at what the company paid for them. 
A)  Means that information is supported by independent, unbiased evidence. 
B)  Means that information can be based on what the preparer thinks is true. 
C)  Means that financial statement should contain information that is optimistic. 
D)  Means that a business may not recognize revenue until cash is received. 
E)  Means the assets acquired must be recorded at what the company paid for them.

Question 14

The International Accounting Standards Board (IASB) is the government group that establishes reporting requirements for companies that issue stock to the public.

Accepted Answer

A) True 
 B)False

Question 15

Beta Corporation purchased $100,000 worth of land by paying 10,000 cash and signing a $90,000 mortgage. Immediately prior to this transaction the corporation had assets, liabilities, and owners' equity in the amounts of $150,000, $30,000, and $120,000 respectively. What is the total amount of Beta Corporation's assets after this transaction has been recorded?

Accepted Answer

A)  $240,000 
B)  $250,000 
C)  $160,000 
D)  $40,000 
E)  $260,000 
A)  $240,000 
B)  $250,000 
C)  $160,000 
D)  $40,000 
E)  $260,000

Question 16

Maslow's Consulting Inc. had retained earnings of $172,500 at December 31, 2010. Net income for 2011 amounted to $56,400. Dividends during 2009 were $48,000. Prepare the statement of retained earnings for 2011.

Accepted Answer

The answer of Maslow's Consulting Inc. had retained earnings of...

Question 17

Retained earnings are increased when cash is received from customers in payment of previously recorded accounts receivable.

Accepted Answer

A) True 
 B)False

Question 18

Identify the two main groups involved in establishing generally accepted accounting principles in the United States.

Accepted Answer

The FASB is the private group

Question 19

From the information given, prepare a November statement of retained earnings.
On November 1 of the current year, Lois Bell began Lois Bell, Interior Design as a corporation with an initial investment of $50,000 cash. On November 30 her records showed the following (alphabetically arranged) selected accounts and amounts:
 $\begin{array}{|l|r|l|r|}
\hline \text { Accounts Payable } & \$ 12,000 & \text { Office Furnishings } & \$ 40,000 \
\hline \text { Accounts Receivable } & 23,000 & \text { Dividends } & 6,000 \
\hline \text { Cash } & 17,200 & \text { Rent Expense } & 3,600 \
\hline \text { Fees Earned } & 30,000 & \text { Salaries Expense } & 6,200 \
\hline \text { Notes Payable } & 4,250 & \text { Telephone Expense } & 250 \
\hline
\end{array}$

Accepted Answer

The answer of From the information given, prepare a November...

Question 20

Technological advancement

Accepted Answer

A)  Has replaced accounting. 
B)  Has not changed the work that accountants do. 
C)  Has freed accounting professionals to concentrate more on the analysis and interpretation of information. 
D)  In accounting has replaced the need for decision makers. 
E)  In accounting is only available to large corporations. 
A)  Has replaced accounting. 
B)  Has not changed the work that accountants do. 
C)  Has freed accounting professionals to concentrate more on the analysis and interpretation of information. 
D)  In accounting has replaced the need for decision makers. 
E)  In accounting is only available to large corporations.

An example of an operating activity is:

Which of the following elements are found on the income statement?

Which of the following is the primary purpose of accounting?

Della's Donuts has revenues of $83,000 and expenses of $64,000. Calculate its net income.

Identify the risk and the return in each of the following examples: A. Investing $500 in a CD at 4.5% interest. B. Placing a $100 bet on an NBA game. C. Investing $10,000 in Microsoft stock. D. Borrowing $20,000 in student loans.

Why should assets be recorded at historical cost?

Cool Tours had beginning equity of $72,000, net income of $25,000, and dividends of $9,000. Calculate the ending equity.

If the assets of a business increased $89,000 during a period of time and its liabilities increased $67,000 during the same period, equity in the business must have:

FastForward had cash inflows from operations of $62,500; cash outflows from investing activities of $47,000; and cash inflows from financing of $25,000. The net change in cash was:

Revenues are:

The records of Skymaster Airplane Rentals show the following information as of December 31, 2014: Dividends of $52,000 were paid during 2014. Using the above information, prepare a balance sheet at December 31, 2014.

What is the balance sheet? What is its purpose?

The objectivity principle:

The International Accounting Standards Board (IASB) is the government group that establishes reporting requirements for companies that issue stock to the public.

Maslow's Consulting Inc. had retained earnings of $172,500 at December 31, 2010. Net income for 2011 amounted to $56,400. Dividends during 2009 were $48,000. Prepare the statement of retained earnings for 2011.

Retained earnings are increased when cash is received from customers in payment of previously recorded accounts receivable.

Identify the two main groups involved in establishing generally accepted accounting principles in the United States.

Technological advancement

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

Exam 1: Introducing Financial Accounting

An example of an operating activity is:

Which of the following elements are found on the income statement?

Which of the following is the primary purpose of accounting?

Della's Donuts has revenues of $83,000 and expenses of $64,000. Calculate its net income.

Identify the risk and the return in each of the following examples: A. Investing $500 in a CD at 4.5% interest. B. Placing a $100 bet on an NBA game. C. Investing $10,000 in Microsoft stock. D. Borrowing $20,000 in student loans.

Why should assets be recorded at historical cost?

Cool Tours had beginning equity of $72,000, net income of $25,000, and dividends of $9,000. Calculate the ending equity.

If the assets of a business increased $89,000 during a period of time and its liabilities increased $67,000 during the same period, equity in the business must have:

FastForward had cash inflows from operations of $62,500; cash outflows from investing activities of $47,000; and cash inflows from financing of $25,000. The net change in cash was:

Revenues are:

The records of Skymaster Airplane Rentals show the following information as of December 31, 2014: Dividends of $52,000 were paid during 2014. Using the above information, prepare a balance sheet at December 31, 2014.

What is the balance sheet? What is its purpose?

The objectivity principle:

The International Accounting Standards Board (IASB) is the government group that establishes reporting requirements for companies that issue stock to the public.

Maslow's Consulting Inc. had retained earnings of $172,500 at December 31, 2010. Net income for 2011 amounted to $56,400. Dividends during 2009 were $48,000. Prepare the statement of retained earnings for 2011.

Retained earnings are increased when cash is received from customers in payment of previously recorded accounts receivable.

Identify the two main groups involved in establishing generally accepted accounting principles in the United States.

Technological advancement

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