Exam 1: Introduction to Financial Statements

Stockholders' equity can be described as claims of

Which of the following groups uses accounting information to determine whether the company's net income will result in a stock price increase?

In the annual report where would a financial statement reader find out if the company's financial statements give a fair depiction of its financial position and operating results?

Marvin Services Corporation had the following accounts and balances: Accounts payable \ 30,000 Equipment \ 35,000 Accounts receivable 5,000 Land 35,000 Buildings ? Unearned service revenue 10,000 Cash 15,000 Total stockholders' equity ? If the balance of the Buildings account was $70000 and $5000 of Accounts Payable were paid in cash what would be the balance of the total stockholders' equity?

Which type of corporate information is not available to investors?

Jack and Jill form a partnership.Jack runs the business in New York while Jill vacations in Hawaii.During the time Jill is away from the business Jack increases the debts of the business by $20000.Which of the following statements is true regarding this debt?

Which one of the following questions is most likely asked by an internal human resources director for the company?

If the assets owned by a business total $150000 and liabilities total $105000 stockholders' equity totals $45000.

Common stock is reported on the

Examples of notes are descriptions of the significant accounting policies and methods used in preparing the statements explanations of contingencies and various statistics.

If total liabilities increased by $90000 and stockholders' equity increased by $30000 during a period of time then total assets must change by what amount and direction during that same period?

The accounting equation can be expressed as Assets - Stockholders' Equity = Liabilities.

The common characteristic possessed by all assets is

A business organized as a corporation

Corporate stockholders generally pay higher taxes but have no personal liability.

Why should the income statement be prepared first?

Jackson Company recorded the following cash transactions for the year: Paid $135000 for salaries. Paid $60000 to purchase office equipment. Paid $15000 for utilities. Paid $6000 in dividends. Collected $275000 from customers. What was Jackson's net cash provided by operating activities?

An auditor is an accounting professional who conducts an independent examination of the accounting data presented by a company.

Which of the following statements is not true regarding the Sarbanes-Oxley Act (SOX)?

All of the following are advantages for choosing a proprietorship for a business except