Exam 1: An Introduction to Accounting

Reynolds Company experienced an accounting event that affected its financial statements as indicated below: Which of the following accounting events could have caused these effects on Reynolds' statements?

What is meant by the term "global GAAP"? How does it impact U.S. companies? What body is responsible for setting global standards?

During Year 2, Chico Company earned $1,950 of cash revenue, paid $1,600 of cash expenses, and paid a $150 cash dividend to its stockholders. Based on this information alone, which of the following statements is not true?

Which of the following accounts are permanent?

Packard Company engaged in the following transactions during Year 1, its first year of operations. (Assume all transactions are cash transactions.)1) Acquired $1,550 cash from the issue of common stock.2) Borrowed $1,020 from a bank.3) Earned $1,200 of revenues cash.4) Paid expenses of $370.5) Paid a $170 dividend.During Year 2, Packard engaged in the following transactions. (Assume all transactions are cash transactions.)1) Issued an additional $925 of common stock.2) Repaid $640 of its debt to the bank.3) Earned revenues of $1,350 cash.4) Incurred expenses of $600.5) Paid dividends of $220.What is the net cash inflow from operating activities on Packard's statement of cash flows for Year 2?

Indicate how this event affects the accounting equation. Use the following letters to record your answer in the box shown below each element. If an event increases one account and decreases another account within the same element, record I/D. If an event has no impact on the element, record NA. You do not need to enter amounts.Increase = I Decrease = D Not Affected = NAPierce Company paid $40,000 cash to purchase land. $\quad$ $\quad$ $\quad$ $\quad$$\text { Balance Sheet }$ $\text { Assets }=\text { Liabilities }+\quad \text { Stockholders' Ecuity }$

During the year, Millstone Company earned $6,500 of cash revenue, paid cash dividends of $1,000 to stockholders and paid $4,000 for cash expenses. Liabilities were unchanged. Which of the following accurately describes the effect of these events on the elements of the company's financial statements?

Santa Fe Company was started on January 1, Year 1, when it acquired $9,000 cash by issuing common stock. During Year 1, the company earned cash revenues of $4,500, paid cash expenses of $3,750, and paid a cash dividend of $250. Based on this information, which of the following statements is true?

Chow Company earned $3,700 of cash revenue, paid $2,100 for cash expenses, and paid a $750 cash dividend to its stockholders. Which of the following statements is true?

Chico Company experienced an accounting event that affected its financial statements as indicated below: Which of the following accounting events could have caused these effects on Chico's statements?

From what three sources does a business obtain its assets?

Mayberry Company paid $30,000 cash to purchase land. As a result of this business event:

If a corporation issues common stock for $50,000 cash, in which section of the statement of cash flows will this transaction be reported?

Packard Company engaged in the following transactions during Year 1, its first year of operations. (Assume all transactions are cash transactions.)1) Acquired $950 cash from the issue of common stock. 2) Borrowed $420 from a bank. 3) Earned $650 of revenues cash. 4) Paid expenses of $250. 5) Paid a $50 dividend.During Year 2, Packard engaged in the following transactions. (Assume all transactions are cash transactions.)1) Issued an additional $325 of common stock. 2) Repaid $220 of its debt to the bank. 3) Earned revenues of $750 cash. 4) Incurred expenses of $360. 5) Paid dividends of $100. What was the amount of total stockholders' equity on Packard's balance sheet at the end of Year 1?

At the beginning of Year 2, Grace Company's accounting records had the general ledger accounts and balances shown in the table below. During Year 2, the following transactions occurred:Received $95,000 cash for providing services to customersPaid salaries expense, $50,000Purchased land for $12,000 cashPaid $4,000 on note payablePaid operating expenses, $22,000Paid cash dividend, $2,500Required:Record the transactions in the appropriate general ledger accounts. Record the amounts of revenue, expense, and dividends in the retained earnings column. Enter 0 for items not affected. Provide appropriate titles for these accounts in the last column of the table.

Which of the following cash transactions results in an increase to one asset account and a decrease to another asset account?

Which of the following shows the effects of providing services for cash on the balance sheet and income statement?

During Year 1, Sawyer Company earned $42,000 of cash revenue and paid $28,200 of cash expenses and $1,600 in dividends to the company's stockholders. Enter each of these three events into the horizontal financial statements model, below. Indicate dollar amounts of increases and decreases. For cash flows, show whether they are operating activities (OA), investing activities (IA), or financing activities (FA). Enter 0 if there would be no entry in a column.

What is reported on a balance sheet?

Jackson Company had a net increase in cash from operating activities of $10,000 and a net decrease in cash from financing activities of $2,000. If the beginning and ending cash balances for the company were $4,000 and $11,000, respectively, what is the net cash change from investing activities?