Exam 1: Accounting As a Form of Communication

Property, plant and equipment are classified as assets on the balance sheet.

Surge Company reports the following information at December 31, 2015: What is Surge Company's net income?

Which of the following would be internal users of accounting information?

Three organizations important to accounting are listed below. Select the organization that most closely achieves the role described. -Has the ultimate authority to set accounting standards, but has allowed the profession to do so.

The Space Corporation began 2015 with $390,000 in assets, $140,000 in liabilities, and $170,000 of retained earnings the year was $120,000, and dividends of $110,000 were declared and paid. A Prepare a statement of retained earnings for 2015. B What is the nature or purpose of the statement of retained earnings? C What was the amount of capital stock for Space Corporation at the beginning of 2015? D Identify what business events might occur in Space Corp.'s business operations that would cause the two st equity items to increase. E How do you identify whether Space was profitable during 20154 by examining the statement of retained ear

One primary purpose of a classified balance sheet is to help users evaluate the liquidity of a company.

Which financial statement reports information helpful in assessing working capital?

For each statement provided, choose the letter of the appropriate term from the list that each statement best describes. Some terms may be used more than once, while others are not used at all. -The assumption that an entity is not in the process of liquidation and that it will continue indefinitely.

Brock Corporation's end­of­year balance sheet consisted of the following amounts: What is Brock's total liabilities balance at the end of the current year?

Volt Corp. reported the following information for the year ended December 31, 2015: How much was paid out in dividends by Volt in 2015?

Read the information for Canyon Corporation. Determine the following amounts for Canyon Corporation: A Total revenues for 2014. B Total expenses for 2014. C Net income for 2014.

If the current ratio is 2.5 to 1, net income is $6,000, and current liabilities are $18,000, how much is working capital?

Match the selected items from a classified balance sheet and multiple-step income statement to the section in which they would appear on the classified balance sheet or the income statement. -Wages payable

From the following list, select the proper section from the statement of cash flows in which it would be classified. -Paid a cash dividend on capital stock

The natural progression in items from one statement to another and preparation of financial statements is best represented by the following order:

Comparative income statements for Gregson Inc. are as follows: Required: The president and management believe that the company performed better in 2014 than it did in 2013. Write the president's letter to be included in the 2014 annual report. Explain why the company is financially sound and why shareholders should not be alarmed by the $120,000 loss in a year when gross profit increased significantly.

List the four financial statements. Explain the connection between these four statements.

What is the operating cycle of a business? How does this impact the classification of assets into current and noncurrent categories?

As used in accounting, the "Notes to the Financial Statements" should be:

During 2014, Wimbrow Images reported $60,000 of net income and generated $80,000 of cash from operations. During the year, Wimbrow Images paid $15,000 to purchase a new delivery truck and also paid dividends in the amount of $30,000. Wimbrow Images borrowed $40,000 cash from the bank. At the beginning of the year, cash amounted to $50,000. A Prepare a statement of cash flows for the year ended December 31, 2014. B How much more cash does Wimbrow Images have available at the end of the year than at the beginning? C Why is there a difference between net income and cash flows from operations?