Exam 1: An Introduction to Accounting

Young Company reported the following balance sheet for the end of Year 1: During Year 2, Young reported the following transactions: Repaid $9,000 to a local bank on a note payableProvided services to clients for $27,400 cashPaid operating expenses of $20,200Paid $4,500 cash dividends to stockholders Required:Prepare Young Company's balance sheet as of December 31, Year 2.

Which of the following is an example of revenue?

Yowell Company began operations on January 1, Year 1. During Year 1, the company engaged in the following cash transactions: 1)issued stock for $40,0002)borrowed $25,000 from its bank3)provided consulting services for $39,0004)paid back $15,000 of the bank loan5)paid rent expense for $9,0006)purchased equipment costing $12,0007)paid $3,000 dividends to stockholders8)paid employees' salaries for work completed during the year, $21,000What is Yowell's ending notes payable balance?

How does the payment of cash dividends to stockholders affect the accounting equation? Is it considered an asset source, asset use, or asset exchange transaction?

The financial statements of Calloway Company prepared at the end of the current year contained the following elements and corresponding amounts: Assets = $50,000; Liabilities = ?; Common Stock = $15,000; Revenue = $22,000; Dividends = $1,500; Beginning Retained Earnings = $3,500; Ending Retained Earnings = $7,500. Based on this information, what was the amount of expenses reported on Calloway's income statement for the current year?

If total assets decrease, then

What is meant by the term "stakeholders"?

Indicate how each event affects the elements of financial statements. Use the following letters to record your answer in the box shown below each element. You do not need to enter dollar amounts. If an event increases one account and decreases another account equally within the same element, record I/D. If an event has no impact on the element, record NA.Increase = IDecrease = DNot Affected = NABell Company provided consulting services for $20,000 cash.

Stosch Company's balance sheet reported assets of $67,000, liabilities of $20,000 and common stock of $17,000 as of December 31, Year 1. Retained earnings on the December 31, Year 2 balance sheet is $38,000 and Stosch paid a $19,000 dividend during Year 2. What is the amount of net income for Year 2?

Dividends paid by a company are reported on which of the following financial statement(s)?

An asset source transaction increases a business's assets and the claims to assets.

Borrowing money from the bank is an example of an asset source transaction.

Which resource providers lend financial resources to a business with the expectation of repayment with interest?

Financial accounting information is usually less detailed than managerial accounting information.

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 owners. Based on this information alone,which of the following statements is not true?

Name the group that has the primary authority for establishing U.S. GAAP.

Liabilities are reported on which of thefollowing financial statement(s)?

Explain some of the similarities and differences between not-for-profit organizations and other types of businesses.

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

Stosch Company's balance sheet reported assets of $40,000, liabilities of $15,000 and common stock of $12,000 as of December 31, Year 1. Retained earnings on the December 31, Year 2 balance sheet is $18,000 and Stosch paid a $14,000 dividend during Year 2. What is the amount of net income for Year 2?