Question 1

Assets - Liabilities = Net Assets

Accepted Answer

A) True 
 B)False

Question 2

The entity concept allows owners the convenience of keeping track of their personal financial records through the business' accounting system.

Accepted Answer

A) True 
 B)False

Question 3

Exchanges of property or service with other entities are called:

Accepted Answer

A)  Transactions. 
B)  Cashflows. 
C)  Outgoings. 
D)  Expenses. 
A)  Transactions. 
B)  Cashflows. 
C)  Outgoings. 
D)  Expenses.

Question 4

____________________ are amounts owed to suppliers for credit purchases.

Accepted Answer

The answer of ____________________ are amounts owed to suppliers for...

Question 5

GAAP sets the rules for businesses to follow in the preparation of financial statements.

Accepted Answer

A) True 
 B)False

Question 6

The earning process refers to the cycle of purchasing inventory, selling the inventory, delivering the inventory, and collecting and paying cash.

Accepted Answer

A) True 
 B)False

Question 7

Describe the effect on the accounting equation of the withdrawal of cash by the owner for personal use.

Accepted Answer

The answer of Describe the effect on the accounting equation...

Question 8

____________________ are the external parties to whom a business owes the debts

Accepted Answer

The answer of ____________________ are the external parties to whom...

Question 9

Example 4.1
The following information applies to the following questions. The accountant for Big Stores has compiled the following information about the business and its accounts:
 $$\begin{array} { l r l r } 
\text { Cash } & \$ 1000 & \text { Inventory } & \$ 10000 \
\text { Revenues } & 5000 & \text { Expenses } & 3000 \
\text { Accounts Payable } & 3000 & \text { Equipment } & 15000 \
\text { Wages Payable } & 2000 & \text { Notes payable } & 12000
\end{array}$$
-Refer to Example 4.1. If this is Big Stores' first year of operations and the owner did not make any withdrawals during the year, how much capital did the owner invest in Big Stores?

Accepted Answer

None

Question 10

Assets - ____________= Owner's Equity.

Accepted Answer

The answer of Assets - ____________= Owner's Equity....

Question 11

The end of period adjustment to record interest on a note payable accumulated, but not yet paid for the period , paid would require:

Accepted Answer

A)  Increasing expenses and increasing liabilities (note payable) 
B)  Increasing revenue and increasing liabilities (note payable). 
C)  Increasing assets and increasing owner's equity. 
D)  Increasing owner's equity and decreasing assets. 
A)  Increasing expenses and increasing liabilities (note payable) 
B)  Increasing revenue and increasing liabilities (note payable). 
C)  Increasing assets and increasing owner's equity. 
D)  Increasing owner's equity and decreasing assets.

Question 12

A transaction would be recorded from a source document.

Accepted Answer

A) True 
 B)False

Question 13

A transaction requires cash to be exchanged for goods or services before it can be recorded.

Accepted Answer

A) True 
 B)False

Question 14

Under ____________________, a business records its revenues and the related expenses in the same accounting period that it provides the goods or services, regardless of when cash is received or paid.

Accepted Answer

The answer of Under ____________________, a business records its revenues...

Question 15

The historical cost concept requires that a business record a transaction based on the cost at the time the transaction occurred.

Accepted Answer

A) True 
 B)False

Question 16

If an entity pays for one year's insurance in the first month of operations, this payment is referred to as:

Accepted Answer

A)  A liability. 
B)  A prepayment. 
C)  An expense. 
D)  Revenue. 
A)  A liability. 
B)  A prepayment. 
C)  An expense. 
D)  Revenue.

Question 17

The accounting equation:

Accepted Answer

A)  requires equilibrium of resources and the claims on those resources. 
B)  requires at least one entry to record a transaction. 
C)  provides the structure for the income statement. 
D)  is another name for the balance sheet. 
A)  requires equilibrium of resources and the claims on those resources. 
B)  requires at least one entry to record a transaction. 
C)  provides the structure for the income statement. 
D)  is another name for the balance sheet.

Question 18

Explain the accounting period.

Accepted Answer

The answer of Explain the accounting period....

Question 19

____________________ are the economic obligations (debts) of the business.

Accepted Answer

The answer of ____________________ are the economic obligations (debts) of...

Question 20

The ____________________ of a business is the owner's current investment in the assets of the business.

Accepted Answer

The answer of The ____________________ of a business is the...

Assets - Liabilities = Net Assets

The entity concept allows owners the convenience of keeping track of their personal financial records through the business' accounting system.

Exchanges of property or service with other entities are called:

____________________ are amounts owed to suppliers for credit purchases.

GAAP sets the rules for businesses to follow in the preparation of financial statements.

The earning process refers to the cycle of purchasing inventory, selling the inventory, delivering the inventory, and collecting and paying cash.

Describe the effect on the accounting equation of the withdrawal of cash by the owner for personal use.

____________________ are the external parties to whom a business owes the debts

Assets - ____________= Owner's Equity.

The end of period adjustment to record interest on a note payable accumulated, but not yet paid for the period , paid would require:

A transaction would be recorded from a source document.

A transaction requires cash to be exchanged for goods or services before it can be recorded.

Under ____________________, a business records its revenues and the related expenses in the same accounting period that it provides the goods or services, regardless of when cash is received or paid.

The historical cost concept requires that a business record a transaction based on the cost at the time the transaction occurred.

If an entity pays for one year's insurance in the first month of operations, this payment is referred to as:

The accounting equation:

Explain the accounting period.

____________________ are the economic obligations (debts) of the business.

The ____________________ of a business is the owner's current investment in the assets of the business.

Introduction to Business Accounting and the Role of Professional Skills

Developing a Business Plan: Cost-Volume-Profit Analysis

Developing a Business Plan: Budgeting

Recording, Storing and Reporting Accounting Information

Managing and Reporting Working Capital

The Income Statement: Content and Use

The Balance Sheet: Content, Use and Analysis

The Cash Flow Statement: Content and Use

Sustainable Business

Short-Term Planning Decisions

Capital Expenditure Decisions

Filters

Exam 4: The Accounting System: Concepts and Applications

Assets - Liabilities = Net Assets

The entity concept allows owners the convenience of keeping track of their personal financial records through the business' accounting system.

Exchanges of property or service with other entities are called:

____________________ are amounts owed to suppliers for credit purchases.

GAAP sets the rules for businesses to follow in the preparation of financial statements.

The earning process refers to the cycle of purchasing inventory, selling the inventory, delivering the inventory, and collecting and paying cash.

Describe the effect on the accounting equation of the withdrawal of cash by the owner for personal use.

____________________ are the external parties to whom a business owes the debts

Assets - ____________= Owner's Equity.

The end of period adjustment to record interest on a note payable accumulated, but not yet paid for the period , paid would require:

A transaction would be recorded from a source document.

A transaction requires cash to be exchanged for goods or services before it can be recorded.

Under ____________________, a business records its revenues and the related expenses in the same accounting period that it provides the goods or services, regardless of when cash is received or paid.

The historical cost concept requires that a business record a transaction based on the cost at the time the transaction occurred.

If an entity pays for one year's insurance in the first month of operations, this payment is referred to as:

The accounting equation:

Explain the accounting period.

____________________ are the economic obligations (debts) of the business.

The ____________________ of a business is the owner's current investment in the assets of the business.

Introduction to Business Accounting and the Role of Professional Skills

Developing a Business Plan: Cost-Volume-Profit Analysis

Developing a Business Plan: Budgeting

Recording, Storing and Reporting Accounting Information

Managing and Reporting Working Capital

The Income Statement: Content and Use

The Balance Sheet: Content, Use and Analysis

The Cash Flow Statement: Content and Use

Sustainable Business

Short-Term Planning Decisions

Capital Expenditure Decisions

Filters