Question 1

Describe source documents and their purpose

Accepted Answer

Source documents are the business papers

Question 2

What is the statement of financial position? What is its purpose? 198)

Accepted Answer

The statement of financial position, or

Question 3

Describe the relationship between sales (or revenues), expenses, and profit

Accepted Answer

Sales, or revenues, are the amounts earn

Question 4

Fees earned by a business in exchange for services provided by the business appear onwhich of the following statements?

Accepted Answer

A) Statement of changes in equity. 
B) Statement of cash flows. 
C) Balance sheet. 
D) Income statement. 
E) Statement of financial position. 
A) Statement of changes in equity. 
B) Statement of cash flows. 
C) Balance sheet. 
D) Income statement. 
E) Statement of financial position.

Question 5

The recording of financial transactions either manually or electronically is called

Accepted Answer

A) Preparing financial statements. 
B) Accounting. 
C) Systems design. 
D) Bookkeeping. 
E) Auditing. 
A) Preparing financial statements. 
B) Accounting. 
C) Systems design. 
D) Bookkeeping. 
E) Auditing.

Question 6

Explain the accounting equation, also called the balance sheet equation

Accepted Answer

The accounting equation is stated as ass

Question 7

"Bookkeeping" is another term for "accounting"

Accepted Answer

A) True 
 B)False

Question 8

Net income is equal to the change in equity due to operating activities over a period oftime.

Accepted Answer

A) True 
 B)False

Question 9

A parcel of land is offered for sale at $135,000, is assessed for tax purposes at$60,000, is recognized by its purchasers as easily being worth $108,000, and is purchased for $106,000. At what amount should the land be recorded in thepurchaser's books? What accounting principle supports your answer?

Accepted Answer

$106,000. The cost principle r

Question 10

A characteristic of liabilities is their capacity to reduce future assets

Accepted Answer

A) True 
 B)False

Question 11

Which financial statement shows whether the business earned a profit or loss, and also lists the types and amounts of the revenues and expenses?

Accepted Answer

A) Balance sheet. 
B) Statement of cash flows. 
C) Income statement. 
D) Statement of changes in equity. 
E) Statement of financial position. 
A) Balance sheet. 
B) Statement of cash flows. 
C) Income statement. 
D) Statement of changes in equity. 
E) Statement of financial position.

Question 12

Today, Cedar Park Company paid $600 of its accounts payable in cash. What is the effect on the accounting equation?

Accepted Answer

A) Assets, no effect; liabilities, $600 decrease; equity, $400 increase. 
B) Assets, $600 increase; liabilities, no effect; equity, $600 increase. 
C) Assets, $600 decrease; liabilities, $400 increase; equity, $200 decrease. 
D) Assets, $600 decrease; liabilities, $600 decrease; equity, no effect. 
E) No effect. 
A) Assets, no effect; liabilities, $600 decrease; equity, $400 increase. 
B) Assets, $600 increase; liabilities, no effect; equity, $600 increase. 
C) Assets, $600 decrease; liabilities, $400 increase; equity, $200 decrease. 
D) Assets, $600 decrease; liabilities, $600 decrease; equity, no effect. 
E) No effect.

Question 13

Payments of cash by a corporation to its shareholders are called

Accepted Answer

A) Dividends. 
B) Shareholders equity. 
C) Withdrawals. 
D) Cheques. 
E) Expenses. 
A) Dividends. 
B) Shareholders equity. 
C) Withdrawals. 
D) Cheques. 
E) Expenses.

Question 14

Ownership of a corporation is divided into units called shares

Accepted Answer

A) True 
 B)False

Question 15

Blu Lightning Co. bought supplies and testing equipment for $3,000 on credit.Enter the appropriate amounts into the accounting equation format

Accepted Answer

The answer of Blu Lightning Co. bought supplies and testing...

Question 16

The accounting principle that states that revenue is recorded at the time that it is earned regardless of whether cash or another asset has been exchanged is the:

Accepted Answer

A) Monetary unit principle. 
B) Going concern principle. 
C) Business entity principle. 
D) Cost principle. 
E) Revenue recognition principle. 
A) Monetary unit principle. 
B) Going concern principle. 
C) Business entity principle. 
D) Cost principle. 
E) Revenue recognition principle.

Question 17

If the liabilities of a business increased $8,000 during a period of time and equity in thebusiness decreased $4,000 during the same period, the assets of the business must have:

Accepted Answer

A) Decreased $4,000. 
B) Increased $6,000. 
C) Decreased $12,000. 
D) Increased $4,000. 
E) Increased $12,000. 
A) Decreased $4,000. 
B) Increased $6,000. 
C) Decreased $12,000. 
D) Increased $4,000. 
E) Increased $12,000.

Question 18

The question of when revenue should be recognized on the income statement(according to GAAP)is answered by the:

Accepted Answer

A) Business entity principle. 
B) Going concern principle. 
C) Revenue recognition principle. 
D) Monetary unit principle. 
E) Cost principle. 
A) Business entity principle. 
B) Going concern principle. 
C) Revenue recognition principle. 
D) Monetary unit principle. 
E) Cost principle.

Question 19

The preferred ethical path is to take a course of action that avoids casting doubt on one's decisions.

Accepted Answer

A) True 
 B)False

Question 20

The primary objective of GAAP is to provide accounting information that is

Accepted Answer

A) Comparability. 
B) Timeliness. 
C) Neutral. 
D) Freedom from bias. 
E) Usefulness for decision making. 
A) Comparability. 
B) Timeliness. 
C) Neutral. 
D) Freedom from bias. 
E) Usefulness for decision making.

Describe source documents and their purpose

What is the statement of financial position? What is its purpose? 198)

Describe the relationship between sales (or revenues), expenses, and profit

Fees earned by a business in exchange for services provided by the business appear onwhich of the following statements?

The recording of financial transactions either manually or electronically is called

Explain the accounting equation, also called the balance sheet equation

"Bookkeeping" is another term for "accounting"

Net income is equal to the change in equity due to operating activities over a period oftime.

A parcel of land is offered for sale at $135,000, is assessed for tax purposes at$60,000, is recognized by its purchasers as easily being worth $108,000, and is purchased for $106,000. At what amount should the land be recorded in thepurchaser's books? What accounting principle supports your answer?

A characteristic of liabilities is their capacity to reduce future assets

Which financial statement shows whether the business earned a profit or loss, and also lists the types and amounts of the revenues and expenses?

Today, Cedar Park Company paid $600 of its accounts payable in cash. What is the effect on the accounting equation?

Payments of cash by a corporation to its shareholders are called

Ownership of a corporation is divided into units called shares

Blu Lightning Co. bought supplies and testing equipment for $3,000 on credit.Enter the appropriate amounts into the accounting equation format

The accounting principle that states that revenue is recorded at the time that it is earned regardless of whether cash or another asset has been exchanged is the:

If the liabilities of a business increased $8,000 during a period of time and equity in thebusiness decreased $4,000 during the same period, the assets of the business must have:

The question of when revenue should be recognized on the income statement(according to GAAP)is answered by the:

The preferred ethical path is to take a course of action that avoids casting doubt on one's decisions.

The primary objective of GAAP is to provide accounting information that is

Analyzing and Recording Transactions

Adjusting Accounts for Financial Statements

Completing the Accounting Cycle and Classifying Accounts

Accounting for Merchandising Activities

Inventory Costing and Valuation

Internal Control and Cash

Receivables

Appendix

Filters

Exam 1: Accounting in Business

Describe source documents and their purpose

What is the statement of financial position? What is its purpose? 198)

Describe the relationship between sales (or revenues), expenses, and profit

Fees earned by a business in exchange for services provided by the business appear onwhich of the following statements?

The recording of financial transactions either manually or electronically is called

Explain the accounting equation, also called the balance sheet equation

"Bookkeeping" is another term for "accounting"

Net income is equal to the change in equity due to operating activities over a period oftime.

A characteristic of liabilities is their capacity to reduce future assets

Which financial statement shows whether the business earned a profit or loss, and also lists the types and amounts of the revenues and expenses?

Today, Cedar Park Company paid $600 of its accounts payable in cash. What is the effect on the accounting equation?

Payments of cash by a corporation to its shareholders are called

Ownership of a corporation is divided into units called shares

Blu Lightning Co. bought supplies and testing equipment for $3,000 on credit.Enter the appropriate amounts into the accounting equation format

The accounting principle that states that revenue is recorded at the time that it is earned regardless of whether cash or another asset has been exchanged is the:

If the liabilities of a business increased $8,000 during a period of time and equity in thebusiness decreased $4,000 during the same period, the assets of the business must have:

The question of when revenue should be recognized on the income statement(according to GAAP)is answered by the:

The preferred ethical path is to take a course of action that avoids casting doubt on one's decisions.

The primary objective of GAAP is to provide accounting information that is

Analyzing and Recording Transactions

Adjusting Accounts for Financial Statements

Completing the Accounting Cycle and Classifying Accounts

Accounting for Merchandising Activities

Inventory Costing and Valuation

Internal Control and Cash

Receivables

Appendix

Filters