Exam 2: Basic Accounting Concepts

If liabilities have a balance of $10,000 and stockholders' equity has a balance of $60,000,then assets must have a balance of:

Which of the following transactions changes the mix of assets only?

The first month of operation showed the net cash from operating activities to be $1,850,the net cash from investing activities to be ($3,000),and the ending cash balance to be $1,600.The net cash from financing activities must be:

Which of the following situations increase stockholders' equity?

The payment of a liability:

For EFG Co.,the transaction "purchase of store equipment with a note payable" would:

Johnson,Inc.paid rent expense of $3,500 for the month of October.How are the accounts affected due to this transaction?

DAF Company paid a utility bill of $300 and paid rent of $700 in December.By how much would these events reduce stockholders' equity?

A common-sized income statement is prepared by expressing income statement amounts as a percent of purchases.

When a notes payable account is paid in cash,the stockholders' equity in the business increases.

For EFG Co.,the transaction "billed a customer for fees earned" would:

For EFG Co.,the transaction "payment of quarterly taxes" would:

The accounting equation can be expressed as: Assets - Liabilities = Revenues.

Exhibit 2-1 Total Assets Total Liabilities Beginning of the year $300,000 $130,000 End of the year $800,000 $550,000 -Refer to Exhibit 2-1.Determine the net income (or loss),assuming $50,000 of stock was issued and no dividends were paid?

For EFG Co.,the transaction "payment of interest expense" would:

When capital stock is issued by a corporation for cash,both the income statement and the balance sheet are affected.

Declaring and paying cash dividends affects which balance sheet accounts?

It is possible for a transaction to change the makeup of assets,but to not affect assets in total.

On May 1,the cash account balance was $72,600.During May,cash receipts totaled $345,600 and the May 31 balance was $95,230.Determine the cash payments made during May.

The payment of utilities expense in cash would affect the operating activities in the statement of cash flows and the income statement but not the balance sheet.