Question 1

Match the terms with the definitions.
-Net income divided by average owner's equity.

Accepted Answer

A) accounts receivable turnover 
B) average collection period 
C) reversing entry 
D) return on owner's equity 
E) current assets
F)current liabilities
G)quick ratio
H)post-closing trial balance
I)Mortgage Payable
J)income from operations
K)interstatement analysis
L)mortgage
M)long-term liabilities 
A) accounts receivable turnover 
B) average collection period 
C) reversing entry 
D) return on owner's equity 
E) current assets
F)current liabilities
G)quick ratio
H)post-closing trial balance
I)Mortgage Payable
J)income from operations
K)interstatement analysis
L)mortgage
M)long-term liabilities D

Question 2

Assets that are used for several years in the operation of a business are called

Accepted Answer

A)  marketable securities. 
B)  current assets. 
C)  investments. 
D)  property, plant, and equipment. 
A)  marketable securities. 
B)  current assets. 
C)  investments. 
D)  property, plant, and equipment. D

Question 3

The quick ratio is determined by subtracting current liabilities from quick assets.

Accepted Answer

A) True 
 B)False  False

Question 4

A primary purpose of the work sheet is to serve as an aid in the preparation of the financial statements.

Accepted Answer

A) True 
 B)False

Question 5

Accumulated depreciation amounts are shown as deductions from the

Accepted Answer

A)  cost of building and equipment accounts. 
B)  accounts receivable account. 
C)  accounts payable account. 
D)  prepaid insurance account. 
A)  cost of building and equipment accounts. 
B)  accounts receivable account. 
C)  accounts payable account. 
D)  prepaid insurance account.

Question 6

Match the terms with the definitions.
-Cash and all other assets expected to be converted into cash or consumed within one year or the normal operating cycle of the business, whichever is longer.

Accepted Answer

A) accounts receivable turnover 
B) average collection period 
C) reversing entry 
D) return on owner's equity 
E) current assets
F)current liabilities
G)quick ratio
H)post-closing trial balance
I)Mortgage Payable
J)income from operations
K)interstatement analysis
L)mortgage
M)long-term liabilities 
A) accounts receivable turnover 
B) average collection period 
C) reversing entry 
D) return on owner's equity 
E) current assets
F)current liabilities
G)quick ratio
H)post-closing trial balance
I)Mortgage Payable
J)income from operations
K)interstatement analysis
L)mortgage
M)long-term liabilities

Question 7

Working capital is the amount of capital the firm has to work with for current operations.

Accepted Answer

A) True 
 B)False

Question 8

A mortgage payable is a written agreement specifying that if the borrower does not repay a debt, the lender has the right to take over the property to satisfy the debt.

Accepted Answer

A) True 
 B)False

Question 9

A trial balance of the general ledger accounts taken after the temporary owner's equity accounts have been closed is usually referred to as a

Accepted Answer

A)  post-closing trial balance. 
B)  new accounting period trial balance. 
C)  pre-closing trial balance. 
D)  subsidiary trial balance. 
A)  post-closing trial balance. 
B)  new accounting period trial balance. 
C)  pre-closing trial balance. 
D)  subsidiary trial balance.

Question 10

Assets that are expected to be used for more than one year in an operation of a business are called property, plant, and equipment.

Accepted Answer

A) True 
 B)False

Question 11

The rough "rule of thumb" for a quick ratio is that the ratio should be about

Accepted Answer

A)  2 to 1. 
B)  1 to 1. 
C)  .1 to 1. 
D)  1 to .1. 
A)  2 to 1. 
B)  1 to 1. 
C)  .1 to 1. 
D)  1 to .1.

Question 12

Match the terms with the definitions.
-The number of days in the year divided by the inventory turnover.

Accepted Answer

A) selling expenses 
B) quick assets 
C) average days to sell inventory 
D) book value 
E) property, plant, and equipment
F)operating cycle
G)current ratio
H)general expenses
I)gross profit
J)net sales
K)multiple-step income statement
L)inventory turnover
M)liquidity 
A) selling expenses 
B) quick assets 
C) average days to sell inventory 
D) book value 
E) property, plant, and equipment
F)operating cycle
G)current ratio
H)general expenses
I)gross profit
J)net sales
K)multiple-step income statement
L)inventory turnover
M)liquidity

Question 13

After the temporary owner's equity and drawing accounts are transferred to the permanent owner's equity account, which of the following accounts will have a balance?

Accepted Answer

A)  Expenses 
B)  Revenues 
C)  Owner's Capital 
D)  Income Summary 
A)  Expenses 
B)  Revenues 
C)  Owner's Capital 
D)  Income Summary

Question 14

The purpose of a balance sheet is to summarize the results of operations during an accounting period.

Accepted Answer

A) True 
 B)False

Question 15

Match the terms with the definitions.
-This statement shows a step-by-step calculation of net sales, cost of goods sold, gross profit, operating expenses, income from operations, other revenues and expenses, and net income.

Accepted Answer

A) selling expenses 
B) quick assets 
C) average days to sell inventory 
D) book value 
E) property, plant, and equipment
F)operating cycle
G)current ratio
H)general expenses
I)gross profit
J)net sales
K)multiple-step income statement
L)inventory turnover
M)liquidity 
A) selling expenses 
B) quick assets 
C) average days to sell inventory 
D) book value 
E) property, plant, and equipment
F)operating cycle
G)current ratio
H)general expenses
I)gross profit
J)net sales
K)multiple-step income statement
L)inventory turnover
M)liquidity

Question 16

Return on owner's equity is the ratio of net income to average owner's equity in the business.

Accepted Answer

A) True 
 B)False

Question 17

The ending balance for merchandise inventory is reported on the balance sheet as a current asset.

Accepted Answer

A) True 
 B)False

Question 18

In a multiple-step income statement, operating expenses are subtracted from gross profit to compute

Accepted Answer

A)  income from operations. 
B)  net income. 
C)  other income. 
D)  net loss. 
A)  income from operations. 
B)  net income. 
C)  other income. 
D)  net loss.

Question 19

Match the terms with the definitions.
-Gross sales less sales returns and allowances and sales discounts.

Accepted Answer

A) selling expenses 
B) quick assets 
C) average days to sell inventory 
D) book value 
E) property, plant, and equipment
F)operating cycle
G)current ratio
H)general expenses
I)gross profit
J)net sales
K)multiple-step income statement
L)inventory turnover
M)liquidity 
A) selling expenses 
B) quick assets 
C) average days to sell inventory 
D) book value 
E) property, plant, and equipment
F)operating cycle
G)current ratio
H)general expenses
I)gross profit
J)net sales
K)multiple-step income statement
L)inventory turnover
M)liquidity

Question 20

The cost of a building less its accumulated depreciation represents the undepreciated cost.

Accepted Answer

A) True 
 B)False

Match the terms with the definitions. -Net income divided by average owner's equity.

Assets that are used for several years in the operation of a business are called

The quick ratio is determined by subtracting current liabilities from quick assets.

A primary purpose of the work sheet is to serve as an aid in the preparation of the financial statements.

Accumulated depreciation amounts are shown as deductions from the

Match the terms with the definitions. -Cash and all other assets expected to be converted into cash or consumed within one year or the normal operating cycle of the business, whichever is longer.

Working capital is the amount of capital the firm has to work with for current operations.

A mortgage payable is a written agreement specifying that if the borrower does not repay a debt, the lender has the right to take over the property to satisfy the debt.

A trial balance of the general ledger accounts taken after the temporary owner's equity accounts have been closed is usually referred to as a

Assets that are expected to be used for more than one year in an operation of a business are called property, plant, and equipment.

The rough "rule of thumb" for a quick ratio is that the ratio should be about

Match the terms with the definitions. -The number of days in the year divided by the inventory turnover.

After the temporary owner's equity and drawing accounts are transferred to the permanent owner's equity account, which of the following accounts will have a balance?

The purpose of a balance sheet is to summarize the results of operations during an accounting period.

Match the terms with the definitions. -This statement shows a step-by-step calculation of net sales, cost of goods sold, gross profit, operating expenses, income from operations, other revenues and expenses, and net income.

Return on owner's equity is the ratio of net income to average owner's equity in the business.

The ending balance for merchandise inventory is reported on the balance sheet as a current asset.

In a multiple-step income statement, operating expenses are subtracted from gross profit to compute

Match the terms with the definitions. -Gross sales less sales returns and allowances and sales discounts.

The cost of a building less its accumulated depreciation represents the undepreciated cost.

Introduction to Accounting

Analyzing Transactions: the Accounting Equation

The Double-Entry Framework

Journalizing and Posting Transactions

Adjusting Entries and the Work Sheet

Financial Statements and the Closing Process

Accounting for Cash

Payroll Accounting: Employer Taxes and Reports

Accounting for Sales and Cash Receipts

Accounting for Purchases and Cash Payments

Special Journals

Accounting for Merchandise Inventory

Adjustments and the Work Sheet for a Merchandising Business

Accounting for a Professional Service Business: The Combination Journal

Filters

Exam 15: Financial Statements and Year-End Accounting for a Merchandising Business

Match the terms with the definitions. -Net income divided by average owner's equity.

Assets that are used for several years in the operation of a business are called

The quick ratio is determined by subtracting current liabilities from quick assets.

A primary purpose of the work sheet is to serve as an aid in the preparation of the financial statements.

Accumulated depreciation amounts are shown as deductions from the

Match the terms with the definitions. -Cash and all other assets expected to be converted into cash or consumed within one year or the normal operating cycle of the business, whichever is longer.

Working capital is the amount of capital the firm has to work with for current operations.

A mortgage payable is a written agreement specifying that if the borrower does not repay a debt, the lender has the right to take over the property to satisfy the debt.

A trial balance of the general ledger accounts taken after the temporary owner's equity accounts have been closed is usually referred to as a

Assets that are expected to be used for more than one year in an operation of a business are called property, plant, and equipment.

The rough "rule of thumb" for a quick ratio is that the ratio should be about

Match the terms with the definitions. -The number of days in the year divided by the inventory turnover.

After the temporary owner's equity and drawing accounts are transferred to the permanent owner's equity account, which of the following accounts will have a balance?

The purpose of a balance sheet is to summarize the results of operations during an accounting period.

Match the terms with the definitions. -This statement shows a step-by-step calculation of net sales, cost of goods sold, gross profit, operating expenses, income from operations, other revenues and expenses, and net income.

Return on owner's equity is the ratio of net income to average owner's equity in the business.

The ending balance for merchandise inventory is reported on the balance sheet as a current asset.

In a multiple-step income statement, operating expenses are subtracted from gross profit to compute

Match the terms with the definitions. -Gross sales less sales returns and allowances and sales discounts.

The cost of a building less its accumulated depreciation represents the undepreciated cost.

Introduction to Accounting

Analyzing Transactions: the Accounting Equation

The Double-Entry Framework

Journalizing and Posting Transactions

Adjusting Entries and the Work Sheet

Financial Statements and the Closing Process

Accounting for Cash

Payroll Accounting: Employer Taxes and Reports

Accounting for Sales and Cash Receipts

Accounting for Purchases and Cash Payments

Special Journals

Accounting for Merchandise Inventory

Adjustments and the Work Sheet for a Merchandising Business

Accounting for a Professional Service Business: The Combination Journal

Filters