Question 1

A partnership is a business organized as a separate legal entity.

Accepted Answer

A) True 
 B)False

Question 2

Liabilities:

Accepted Answer

A)  are future economic benefits. 
B)  are debts and obligations. 
C)  possess service potential. 
D)  are things of value owned by a business. 
A)  are future economic benefits. 
B)  are debts and obligations. 
C)  possess service potential. 
D)  are things of value owned by a business.

Question 3

Which of the following financial statements is concerned with the company at a point in time?

Accepted Answer

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

Question 4

Shareholders' equity is usually comprised of

Accepted Answer

A)  common shares and dividends declared. 
B)  common shares and retained earnings. 
C)  dividends declared and retained earnings. 
D)  net income and retained earnings. 
A)  common shares and dividends declared. 
B)  common shares and retained earnings. 
C)  dividends declared and retained earnings. 
D)  net income and retained earnings.

Question 5

Which of the following would not be considered an internal user of accounting data for XYZ Inc.?

Accepted Answer

A)  the company president 
B)  production manager 
C)  purchasing clerk 
D)  receptionist of the employees' labour union 
A)  the company president 
B)  production manager 
C)  purchasing clerk 
D)  receptionist of the employees' labour union

Question 6

The liability created by a business when it purchases coffee beans and coffee cups on credit from suppliers is called a(n)

Accepted Answer

A)  account payable. 
B)  account receivable. 
C)  revenue. 
D)  expense. 
A)  account payable. 
B)  account receivable. 
C)  revenue. 
D)  expense.

Question 7

Which of the following would not be considered an internal user of accounting data?

Accepted Answer

A)  the president of a company 
B)  the controller of a company 
C)  a creditor of a company 
D)  a sales manager of a company 
A)  the president of a company 
B)  the controller of a company 
C)  a creditor of a company 
D)  a sales manager of a company

Question 8

Expenses are the cost of assets consumed or services used in the process of generating revenue.

Accepted Answer

A) True 
 B)False

Question 9

Which of the following is true regarding the statement of cash flows?

Accepted Answer

A)  Financing activities for corporations include lending money and buying shares. 
B)  Investing activities involve collecting the necessary funds to operate the business. 
C)  The purchase of equipment is an example of a financing activity. 
D)  Revenues are increases in economic resources that result from a business's operating activities. 
A)  Financing activities for corporations include lending money and buying shares. 
B)  Investing activities involve collecting the necessary funds to operate the business. 
C)  The purchase of equipment is an example of a financing activity. 
D)  Revenues are increases in economic resources that result from a business's operating activities.

Question 10

Use the following information for questions.
Plumbers-on-the-Go Ltd. started the year with total assets of $120,000 and total liabilities of $75,000. During the year, the business recorded $82,000 in service revenues, $45,000 in expenses, and paid dividends of $2,500.
-Shareholders' equity at the end of the year was

Accepted Answer

A)  $79,500. 
B)  $45,000. 
C)  $82,000. 
D)  $77,000. 
A)  $79,500. 
B)  $45,000. 
C)  $82,000. 
D)  $77,000.

A partnership is a business organized as a separate legal entity.

Liabilities:

Which of the following financial statements is concerned with the company at a point in time?

Shareholders' equity is usually comprised of

Which of the following would not be considered an internal user of accounting data for XYZ Inc.?

The liability created by a business when it purchases coffee beans and coffee cups on credit from suppliers is called a(n)

Which of the following would not be considered an internal user of accounting data?

Expenses are the cost of assets consumed or services used in the process of generating revenue.

Which of the following is true regarding the statement of cash flows?

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations

Reporting and Analyzing Inventory

Internal Control and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Shareholders Equity

Reporting and Analyzing Investments

Statement of Cash Flows

Performance Measurement

Filters

Exam 1: The Purpose and Use of Financial Statements

A partnership is a business organized as a separate legal entity.

Liabilities:

Which of the following financial statements is concerned with the company at a point in time?

Shareholders' equity is usually comprised of

Which of the following would not be considered an internal user of accounting data for XYZ Inc.?

The liability created by a business when it purchases coffee beans and coffee cups on credit from suppliers is called a(n)

Which of the following would not be considered an internal user of accounting data?

Expenses are the cost of assets consumed or services used in the process of generating revenue.

Which of the following is true regarding the statement of cash flows?

A Further Look at Financial Statements

The Accounting Information System

Accrual Accounting Concepts

Merchandising Operations

Reporting and Analyzing Inventory

Internal Control and Cash

Reporting and Analyzing Receivables

Reporting and Analyzing Long-Lived Assets

Reporting and Analyzing Liabilities

Reporting and Analyzing Shareholders Equity

Reporting and Analyzing Investments

Statement of Cash Flows

Performance Measurement

Filters