Question 1

Eileen's Corner Shoppe purchases a new computer for cash. This causes:

Accepted Answer

A) Cash and Capital to increase. 
B) Computer Equipment and Cash to increase. 
C) Computer Equipment to increase and Cash to decrease. 
D) Accounts Payable to increase and Capital to increase. 
A) Cash and Capital to increase. 
B) Computer Equipment and Cash to increase. 
C) Computer Equipment to increase and Cash to decrease. 
D) Accounts Payable to increase and Capital to increase.

Question 2

If total liabilities are $18,000 and owner's equity is $21,000, the total assets must be:

Accepted Answer

A) $39,000. 
B) $5,000. 
C) $20,000. 
D) $17,000. 
A) $39,000. 
B) $5,000. 
C) $20,000. 
D) $17,000.

Question 3

Revenue, expenses, and withdrawals are subdivisions of:

Accepted Answer

A) assets. 
B) liabilities. 
C) owner's equity. 
D) All of these answers are correct. 
A) assets. 
B) liabilities. 
C) owner's equity. 
D) All of these answers are correct.

Question 4

The financial statement that shows business results in terms of revenue and expenses is:

Accepted Answer

A) an income statement. 
B) a balance sheet. 
C) a statement of owner's equity. 
D) the statement of cash flows. 
A) an income statement. 
B) a balance sheet. 
C) a statement of owner's equity. 
D) the statement of cash flows.

Question 5

The purpose of the accounting process is to provide financial information about:

Accepted Answer

A) sole proprietorships. 
B) small businesses. 
C) large corporations. 
D) All of these answers are correct. 
A) sole proprietorships. 
B) small businesses. 
C) large corporations. 
D) All of these answers are correct.

Question 6

Mark paid $800 cash to partially reduce the amount owed for equipment that was previously bought on account. This transaction would:

Accepted Answer

A) increase both assets and liabilities. 
B) increase assets and decrease liabilities. 
C) decrease both assets and liabilities. 
D) decrease assets and increase liabilities. 
A) increase both assets and liabilities. 
B) increase assets and decrease liabilities. 
C) decrease both assets and liabilities. 
D) decrease assets and increase liabilities.

Question 7

The income statement is the first financial statement completed.

Accepted Answer

A) True 
 B)False

Question 8

Prepare the financial statements for H. Logan of Logan Motorcycles from the following account balances: 1)an income statement, 2)a statement of owner's equity, and 3)a balance sheet for the month ended October 31, 200x. You will need to calculate the value of the Accounts Payable account (note: remember the basic accounting equation).

Accepted Answer

The answer of Prepare the financial statements for H. Logan...

Question 9

Determine the ending capital balance of a business which had a beginning capital balance of $1,970, additional investments of $530, withdrawals of $750, revenue of $3,790, and expenses of $2,600.
$ ________

Accepted Answer

$2,940 [$1

Question 10

Withdrawals are considered an expense of doing business.

Accepted Answer

A) True 
 B)False

Question 11

A partnership is a business which is:

Accepted Answer

A) easy to form. 
B) ends with the death of a partner. 
C) owned by more than one person. 
D) All of these answers are correct. 
A) easy to form. 
B) ends with the death of a partner. 
C) owned by more than one person. 
D) All of these answers are correct.

Question 12

Expenses are recorded as costs of doing business whether cash was paid or not.

Accepted Answer

A) True 
 B)False

Question 13

Bonnie's Baskets purchases $4,000 worth of office equipment on account. This causes:

Accepted Answer

A) Cash and Capital to decrease. 
B) Office Equipment and Accounts Payable to increase. 
C) Office Equipment to decrease and Accounts Payable to increase. 
D) Accounts Payable to increase and Capital to decrease. 
A) Cash and Capital to decrease. 
B) Office Equipment and Accounts Payable to increase. 
C) Office Equipment to decrease and Accounts Payable to increase. 
D) Accounts Payable to increase and Capital to decrease.

Question 14

A sole proprietorship ends with the death of the owner.

Accepted Answer

A) True 
 B)False

Question 15

If 'Ol Fashioned Toys' revenues are less than its expenses during the accounting period:

Accepted Answer

A) owner's withdrawals decrease net income. 
B) net income causes liabilities to decrease. 
C) the business will incur a loss. 
D) owner's withdrawals increase owner's equity. 
A) owner's withdrawals decrease net income. 
B) net income causes liabilities to decrease. 
C) the business will incur a loss. 
D) owner's withdrawals increase owner's equity.

Question 16

What is the difference between Bookkeeping and Accounting?

Accepted Answer

Bookkeeping is the recording function wi

Question 17

If liabilities are $10,000 and assets are $20,000, owner's equity will be $10,000.

Accepted Answer

A) True 
 B)False

Question 18

Which accounts are affected when the company pays salaries?

Accepted Answer

A) Assets and Capital 
B) Liabilities and Capital 
C) Assets and Expenses 
D) None of the above are correct. 
A) Assets and Capital 
B) Liabilities and Capital 
C) Assets and Expenses 
D) None of the above are correct.

Question 19

If total liabilities are $1,000 and total assets are $8,000, owner's equity must be:

Accepted Answer

A) $7,000. 
B) $3,000. 
C) $10,000. 
D) $13,000. 
A) $7,000. 
B) $3,000. 
C) $10,000. 
D) $13,000.

Question 20

Use the following information to prepare 1)an income statement, 2)a statement of owner's equity, and 3)a balance sheet for the month ended March 31, 200x for Bolthouse Company.

Accepted Answer

The answer of Use the following information to prepare 1)an...

Exam 1: Accounting Concepts and Procedures

Eileen's Corner Shoppe purchases a new computer for cash. This causes:

If total liabilities are $18,000 and owner's equity is $21,000, the total assets must be:

Revenue, expenses, and withdrawals are subdivisions of:

The financial statement that shows business results in terms of revenue and expenses is:

The purpose of the accounting process is to provide financial information about:

Mark paid $800 cash to partially reduce the amount owed for equipment that was previously bought on account. This transaction would:

The income statement is the first financial statement completed.

Determine the ending capital balance of a business which had a beginning capital balance of $1,970, additional investments of $530, withdrawals of $750, revenue of $3,790, and expenses of $2,600. $ ________

Withdrawals are considered an expense of doing business.

A partnership is a business which is:

Expenses are recorded as costs of doing business whether cash was paid or not.

Bonnie's Baskets purchases $4,000 worth of office equipment on account. This causes:

A sole proprietorship ends with the death of the owner.

If 'Ol Fashioned Toys' revenues are less than its expenses during the accounting period:

What is the difference between Bookkeeping and Accounting?

If liabilities are $10,000 and assets are $20,000, owner's equity will be $10,000.

Which accounts are affected when the company pays salaries?

If total liabilities are $1,000 and total assets are $8,000, owner's equity must be:

Use the following information to prepare 1)an income statement, 2)a statement of owner's equity, and 3)a balance sheet for the month ended March 31, 200x for Bolthouse Company.

Debits and Credits: Analyzing and Recording Business Transactions

Beginning the Accounting Cycle

The Accounting Cycle Continued

The Accounting Cycle Completed

Banking Procedure and Control of Cash

Calculating Pay and Payroll Taxes: The Beginning of the Payroll Process

Paying, Recording, and Reporting Payroll and Payroll Taxes: the Conclusion of the Payroll Process

Sales and Cash Receipts

Purchases and Cash Payments

Preparing a Worksheet for a Merchandise Company

Completion of the Accounting Cycle for a Merchandise Company

Accounting for Bad Debts

Notes Receivable and Notes Payable

Accounting for Merchandise Inventory

Accounting for Property, Plant, Equipment, and Intangible Assets

Partnership

Corporations: Organizations and Stock

Corporations: Stock Values, Dividends, Treasury Stocks, and Retained Earnings

Corporations and Bonds Payable

Statement of Cash Flows

Analyzing Financial Statements

The Voucher System

Departmental Accounting

Manufacturing Accounting

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