Question 1

The balance sheet shows a company at only one point in time.

Accepted Answer

A) True 
 B)False

Question 2

Financial statements for proprietorships and partnerships rarely make distinctions between paid- in capital and retained earnings.

Accepted Answer

A) True 
 B)False

Question 3

Identify which one of the following statements is false.

Accepted Answer

A)  Owners' equity solely represents the profits made by an organization in the current period. 
B)  Assets must always equal the sum of liabilities and owners' equity. 
C)  Liabilities are economic obligations or claims against the assets of an organization by outsiders. 
D)  Assets are economic resources which are expected to benefit future cash inflows or reduce future cash outflows. 
A)  Owners' equity solely represents the profits made by an organization in the current period. 
B)  Assets must always equal the sum of liabilities and owners' equity. 
C)  Liabilities are economic obligations or claims against the assets of an organization by outsiders. 
D)  Assets are economic resources which are expected to benefit future cash inflows or reduce future cash outflows.

Question 4

Examples of accrued expenses include property taxes and interest on borrowed money.

Accepted Answer

A) True 
 B)False

Question 5

would result in a decrease in income under both the accrual and cash basis.

Accepted Answer

A)  The payment of this period's rent 
B)  The recognition of last period's rent 
C)  The cash purchase of inventory 
D)  The payment of next period's rent 
A)  The payment of this period's rent 
B)  The recognition of last period's rent 
C)  The cash purchase of inventory 
D)  The payment of next period's rent

Question 6

would not appear on the financial statements for a sole proprietorship.

Accepted Answer

A)  Accumulated Depreciation 
B)  Unearned Sales Revenues 
C)  Paid- in Capital 
D)  Cost of Goods Sold 
A)  Accumulated Depreciation 
B)  Unearned Sales Revenues 
C)  Paid- in Capital 
D)  Cost of Goods Sold

Question 7

Amounts due from customers are called accounts payable.

Accepted Answer

A) True 
 B)False

Question 8

The acquisition of inventory on open account will:

Accepted Answer

A)  have no effect on the accounting equation 
B)  increase liabilities and decrease stockholders' equity 
C)  increase assets and liabilities 
D)  decrease assets and decrease liabilities 
A)  have no effect on the accounting equation 
B)  increase liabilities and decrease stockholders' equity 
C)  increase assets and liabilities 
D)  decrease assets and decrease liabilities

Question 9

Laker Company acquired a machine for $33,000. At the beginning of the current year the machine had accumulated depreciation of $12,000. Annual depreciation expense totaled $3,000. The book value of the machine at the end of the year equals:

Accepted Answer

A)  $24,000 
B)  $33,000 
C)  $18,000 
D)  $21,000 
A)  $24,000 
B)  $33,000 
C)  $18,000 
D)  $21,000

Question 10

The board of directors of Knick Company declared a dividend. Later, the dividend was disbursed to stockholders. The dividend disbursement would:

Accepted Answer

A)  decrease net income 
B)  decrease both net income and stockholders' equity 
C)  decrease stockholders' equity 
D)  None of these answers is correct. 
A)  decrease net income 
B)  decrease both net income and stockholders' equity 
C)  decrease stockholders' equity 
D)  None of these answers is correct.

Question 11

Cavalier Company paid $2,700 for 6 months' insurance, covering the period of April 1 to September 30. At the time of the payment, the entire amount was used to increase the balance in the Prepaid Insurance account. The balance in the Prepaid Insurance account as of April 30 is:

Accepted Answer

A)  $900 
B)  $2,250 
C)  $1,800 
D)  $- 0- 
A)  $900 
B)  $2,250 
C)  $1,800 
D)  $- 0-

Question 12

When depreciating an asset, the residual value is not a prediction.

Accepted Answer

A) True 
 B)False

Question 13

A collection of the group of accounts that supports the items shown in the major financial statements

Accepted Answer

The answer of A collection of the group of accounts...

Question 14

When a company purchases inventory for cash, total assets decrease.

Accepted Answer

A) True 
 B)False

Question 15

The has ultimate responsibility for specifying generally accepted accounting principles for publicly traded companies in the United States.

Accepted Answer

A)  IASC 
B)  FASB 
C)  SEC 
D)  GAAP 
A)  IASC 
B)  FASB 
C)  SEC 
D)  GAAP

Question 16

Any event that affects the financial position of an organization and requires recording

Accepted Answer

The answer of Any event that affects the financial position...

Question 17

An organization that joins two or more individuals together as co- owners

Accepted Answer

The answer of An organization that joins two or more...

Question 18

Implicit transactions are an integral part of:

Accepted Answer

A)  cash basis accounting 
B)  accrual basis accounting 
C)  not- for- profit accounting 
D)  All of these answers are correct. 
A)  cash basis accounting 
B)  accrual basis accounting 
C)  not- for- profit accounting 
D)  All of these answers are correct.

Question 19

Owners' equity is the excess cash that the company has made.

Accepted Answer

A) True 
 B)False

Question 20

Rocket Company paid $16,000 for January, February, March, and April rent in advance. The balance in the Prepaid Rent account as of January 31 is:

Accepted Answer

A)  $4,000 
B)  $12,000 
C)  $16,000 
D)  $- 0- 
A)  $4,000 
B)  $12,000 
C)  $16,000 
D)  $- 0-

The balance sheet shows a company at only one point in time.

Financial statements for proprietorships and partnerships rarely make distinctions between paid- in capital and retained earnings.

Identify which one of the following statements is false.

Examples of accrued expenses include property taxes and interest on borrowed money.

would result in a decrease in income under both the accrual and cash basis.

would not appear on the financial statements for a sole proprietorship.

Amounts due from customers are called accounts payable.

The acquisition of inventory on open account will:

Laker Company acquired a machine for $33,000. At the beginning of the current year the machine had accumulated depreciation of $12,000. Annual depreciation expense totaled $3,000. The book value of the machine at the end of the year equals:

The board of directors of Knick Company declared a dividend. Later, the dividend was disbursed to stockholders. The dividend disbursement would:

Cavalier Company paid $2,700 for 6 months' insurance, covering the period of April 1 to September 30. At the time of the payment, the entire amount was used to increase the balance in the Prepaid Insurance account. The balance in the Prepaid Insurance account as of April 30 is:

When depreciating an asset, the residual value is not a prediction.

A collection of the group of accounts that supports the items shown in the major financial statements

When a company purchases inventory for cash, total assets decrease.

The has ultimate responsibility for specifying generally accepted accounting principles for publicly traded companies in the United States.

Any event that affects the financial position of an organization and requires recording

An organization that joins two or more individuals together as co- owners

Implicit transactions are an integral part of:

Owners' equity is the excess cash that the company has made.

Rocket Company paid $16,000 for January, February, March, and April rent in advance. The balance in the Prepaid Rent account as of January 31 is:

Managerial Accounting and the Business Organization

Introduction to Cost Behavior and Cost Volume Relationships

Measurement of Cost Behavior

Cost Management Systems and Activity-Based Costing

Relevant Information and Decision-Making: Marketing Decisions

Relevant Information and Decision-Making: Product Decisions

The Master Budget

Flexible Budget and Variance Analysis

Management Control Systems and Responsibility Accounting

Management Control in Decentralized Organizations

Capital Budgeting

Cost Allocation

Job-Costing

Process-Costing Systems

Basic Accounting Concepts, Techniques, and Conventions

Understanding Corporate Annual Reports: Basic Financial Statements

Filters

Exam 15: Overhead Application: Variable and Absorbtion Costing

The balance sheet shows a company at only one point in time.

Financial statements for proprietorships and partnerships rarely make distinctions between paid- in capital and retained earnings.

Identify which one of the following statements is false.

Examples of accrued expenses include property taxes and interest on borrowed money.

would result in a decrease in income under both the accrual and cash basis.

would not appear on the financial statements for a sole proprietorship.

Amounts due from customers are called accounts payable.

The acquisition of inventory on open account will:

Laker Company acquired a machine for $33,000. At the beginning of the current year the machine had accumulated depreciation of $12,000. Annual depreciation expense totaled $3,000. The book value of the machine at the end of the year equals:

The board of directors of Knick Company declared a dividend. Later, the dividend was disbursed to stockholders. The dividend disbursement would:

Cavalier Company paid $2,700 for 6 months' insurance, covering the period of April 1 to September 30. At the time of the payment, the entire amount was used to increase the balance in the Prepaid Insurance account. The balance in the Prepaid Insurance account as of April 30 is:

When depreciating an asset, the residual value is not a prediction.

A collection of the group of accounts that supports the items shown in the major financial statements

When a company purchases inventory for cash, total assets decrease.

The has ultimate responsibility for specifying generally accepted accounting principles for publicly traded companies in the United States.

Any event that affects the financial position of an organization and requires recording

An organization that joins two or more individuals together as co- owners

Implicit transactions are an integral part of:

Owners' equity is the excess cash that the company has made.

Rocket Company paid $16,000 for January, February, March, and April rent in advance. The balance in the Prepaid Rent account as of January 31 is:

Managerial Accounting and the Business Organization

Introduction to Cost Behavior and Cost Volume Relationships

Measurement of Cost Behavior

Cost Management Systems and Activity-Based Costing

Relevant Information and Decision-Making: Marketing Decisions

Relevant Information and Decision-Making: Product Decisions

The Master Budget

Flexible Budget and Variance Analysis

Management Control Systems and Responsibility Accounting

Management Control in Decentralized Organizations

Capital Budgeting

Cost Allocation

Job-Costing

Process-Costing Systems

Basic Accounting Concepts, Techniques, and Conventions

Understanding Corporate Annual Reports: Basic Financial Statements

Filters