Question 1

On March 1,a landlord received $10,000 rent for the month of April.On April 1,the landlord will ________.

Accepted Answer

A)  decrease Cash and increase Rent Revenue 
B)  decrease Cash and increase Unearned Rent Revenue 
C)  decrease Paid-in Capital and increase Interest Revenue 
D)  decrease Unearned Rent Revenue and increase Rent Revenue 
A)  decrease Cash and increase Rent Revenue 
B)  decrease Cash and increase Unearned Rent Revenue 
C)  decrease Paid-in Capital and increase Interest Revenue 
D)  decrease Unearned Rent Revenue and increase Rent Revenue

Question 2

California Company opened for business on April 1.Given below is the activity of the company for the month of April.
$\begin{array} { l  }
 \text { Owners invested cash in business}&\$40,000 \
 \text { Credit sales}&\$ 160,000\
 \text {Cash sales }&\$ 20,000\
 \text {Cost of goods sold }&\$124,000 \
 \text { Cash purchases of inventory}&\$50,000 \
 \text {Credit purchases of inventory }&\$100,000 \
 \text { Cash collections from credit customers}&\$75,000 \
 \text {Cash payment for credit purchases of inventory }&\$44,000 \
 \text { Cash borrowed on note payable }&\$54,000 \
 \text { Equipment purchased for cash}&\$ 18,000\
 \text { Cash dividend paid}&\$14,000 \
 \text {Wages earned and paid }&\$28,000 \
 \text {Wages earned and unpaid }&\$4,000 \
 \text {
Rent paid for April, May and June }&\$ 6,000\
\end{array}$

Under accrual basis accounting,what is the net income for the month of April?

Accepted Answer

A)  $8,000 
B)  $12,000 
C)  $18,000 
D)  $22,000 
A)  $8,000 
B)  $12,000 
C)  $18,000 
D)  $22,000

Question 3

Given below are the activities of the Phoenix Company:
$\begin{array} { l  }
 \text {Owners invested cash in business }&\$20,000 \
 \text {Credit sales }&\$ 80,000\
 \text {Cash sales }&\$20,000\
 \text { Cash collections from credit customers}&\$56,000 \
 \text {Purchased inventory on account }&\$ 37,000\
\end{array}$

Using the accrual basis of accounting,the total revenues for Phoenix Company are ________.

Accepted Answer

A)  $46,000 
B)  $90,000 
C)  $100,000 
D)  $173,000 
A)  $46,000 
B)  $90,000 
C)  $100,000 
D)  $173,000

Question 4

In order for the board of directors of a corporation to declare a cash dividend,there must be sufficient ________ and ________.

Accepted Answer

A)  revenues; expenses 
B)  net income; cash 
C)  retained earnings; cash 
D)  revenues; cash 
A)  revenues; expenses 
B)  net income; cash 
C)  retained earnings; cash 
D)  revenues; cash

Question 5

Depreciation expense is recorded for ________.

Accepted Answer

A)  equipment and land 
B)  land and buildings 
C)  equipment and buildings 
D)  equipment, land and building 
A)  equipment and land 
B)  land and buildings 
C)  equipment and buildings 
D)  equipment, land and building

Question 6

Which of the following statements is FALSE?

Accepted Answer

A)  Assets are economic resources that are expected to provide future benefits. 
B)  Liabilities are economic obligations or claims against the assets of an organization by nonowners. 
C)  Assets must always equal the sum of liabilities and owners' equity. 
D)  Owners' equity equals the sum of assets and liabilities. 
A)  Assets are economic resources that are expected to provide future benefits. 
B)  Liabilities are economic obligations or claims against the assets of an organization by nonowners. 
C)  Assets must always equal the sum of liabilities and owners' equity. 
D)  Owners' equity equals the sum of assets and liabilities.

Question 7

The materiality concept is not subjective.

Accepted Answer

A) True 
 B)False

Question 8

The following information was extracted from the accounting records of Yamaguchi Company:
$\begin{array} { l  }
 \text {Paid-in Capital, December 31, 2014 }&\$87,000\
 \text { Retained Earnings, December 31, 2014}&\$211,000\
 \text { Total Assets, December 31, 2014}&\$455,000\
 \text {Revenues for year ended December 31, 2015 }&\$200,000\
 \text { Expenses for year ended December 31, 2015 }&\$165,000\
 \text {Total Assets, December 31, 2015 }&\$605,000\
 \text {Additional investments by owners in 2015 }&\$10,000\
\end{array}$

At December 31,2014,what is the total amount of liabilities?

Accepted Answer

A)  $45,000 
B)  $150,000 
C)  $157,000 
D)  $272,000 
A)  $45,000 
B)  $150,000 
C)  $157,000 
D)  $272,000

Question 9

Increases in ownership claims arising from the delivery of goods are called ________.

Accepted Answer

A)  expenses 
B)  profits 
C)  assets 
D)  revenues 
A)  expenses 
B)  profits 
C)  assets 
D)  revenues

Question 10

Which financial statement summarizes the operating performance of a company over a period of time?

Accepted Answer

A)  statement of cash flows 
B)  statement of stockholders' equity 
C)  balance sheet 
D)  income statement 
A)  statement of cash flows 
B)  statement of stockholders' equity 
C)  balance sheet 
D)  income statement

Question 11

The ownership claim arising from the reinvestment of previous profits is called ________.

Accepted Answer

A)  net assets 
B)  stockholders' equity 
C)  investment income 
D)  retained earnings 
A)  net assets 
B)  stockholders' equity 
C)  investment income 
D)  retained earnings

Question 12

The following information was extracted from the accounting records of Brankov Company:
$$\begin{array} { l l } 
\text { beginning Paid-in Capital } & \$ 90,000 \
\text { beginning Retained Earning } & \$ 300,000 \
\text { beginning Assets } & \$ 455,000 \
\text { Contributions by Owners } & \$ 7 \
\text { Cash dividends declared } & \$ 0 \
\text { Revenues } & \$ 200,000 \
\text { Expenses } & \$ 155,000
\end{array}$$
At the end of the period,what is the total amount of stockholders' equity?

Accepted Answer

A)  $65,000 
B)  $135,000 
C)  $390,000 
D)  $435,000 
A)  $65,000 
B)  $135,000 
C)  $390,000 
D)  $435,000

Question 13

Rent received in advance of the rental period would be considered to be a prepaid asset by the landlord.

Accepted Answer

A) True 
 B)False

Question 14

Amounts owed to vendors for purchases on credit are called ________.Amounts due from customers for credit sales are called ________.

Accepted Answer

A)  accounts payable; notes receivable 
B)  notes payable; notes receivable 
C)  accounts payable; accounts receivable 
D)  debt payable; debt receivable 
A)  accounts payable; notes receivable 
B)  notes payable; notes receivable 
C)  accounts payable; accounts receivable 
D)  debt payable; debt receivable

Question 15

A transaction is any event that affects the financial position of an organization and requires recording.

Accepted Answer

A) True 
 B)False

Question 16

Under accrual basis accounting,we record revenue when ________.

Accepted Answer

A)  cash is received from customers 
B)  cash is received for any reason 
C)  it meets the criteria for revenue recognition 
D)  a company receives cash from a customer on account 
A)  cash is received from customers 
B)  cash is received for any reason 
C)  it meets the criteria for revenue recognition 
D)  a company receives cash from a customer on account

Question 17

The matching concept matches ________ and ________.

Accepted Answer

A)  assets; liabilities 
B)  assets; expenses 
C)  revenues; expenses incurred to generate revenues 
D)  net profit; expenses 
A)  assets; liabilities 
B)  assets; expenses 
C)  revenues; expenses incurred to generate revenues 
D)  net profit; expenses

Question 18

Retained earnings indicate the amount of cash available for distribution to shareholders.

Accepted Answer

A) True 
 B)False

Question 19

The board of directors of Schwinn Company declared a cash dividend.Two weeks later,the dividend was disbursed to stockholders.The dividend disbursement will ________.

Accepted Answer

A)  decrease net income 
B)  decrease stockholders' equity 
C)  decrease liabilities 
D)  increase stockholders' equity 
A)  decrease net income 
B)  decrease stockholders' equity 
C)  decrease liabilities 
D)  increase stockholders' equity

Question 20

The activity of Sterling Company for the month of April is presented below:
$\begin{array} { l  }
 \text { Cost of goods sold}&\$ 62,000\
 \text {Cash purchases of inventory }&\$25,000 \
 \text {Credit purchases of inventory }&\$50,000 \
 \text {Cash paid for credit purchase of inventory }&\$22,000 \
 \text { Cash dividend paid}&\$7,000 \
 \text { Wages earned and paid}&\$14,000 \
 \text {Wages earned and unpaid }&\$ 2,000\
 \text { Rent paid for April, May and June}&\$6,000 \
\end{array}$

Using the accrual basis of accounting,the total expenses for Sterling Company for the month of April is ________.

Accepted Answer

A)  $62,000 
B)  $78,000 
C)  $80,000 
D)  $86,000 
A)  $62,000 
B)  $78,000 
C)  $80,000 
D)  $86,000

On March 1,a landlord received $10,000 rent for the month of April.On April 1,the landlord will ________.

In order for the board of directors of a corporation to declare a cash dividend,there must be sufficient and .

Depreciation expense is recorded for ________.

Which of the following statements is FALSE?

The materiality concept is not subjective.

Increases in ownership claims arising from the delivery of goods are called ________.

Which financial statement summarizes the operating performance of a company over a period of time?

The ownership claim arising from the reinvestment of previous profits is called ________.

Rent received in advance of the rental period would be considered to be a prepaid asset by the landlord.

Amounts owed to vendors for purchases on credit are called .Amounts due from customers for credit sales are called .

A transaction is any event that affects the financial position of an organization and requires recording.

Under accrual basis accounting,we record revenue when ________.

The matching concept matches and .

Retained earnings indicate the amount of cash available for distribution to shareholders.

The board of directors of Schwinn Company declared a cash dividend.Two weeks later,the dividend was disbursed to stockholders.The dividend disbursement will ________.

Managerial Accounting,the Business Organization,and Professional Ethics

Introduction to Cost Behavior and Cost Volume Profit Relationships

Measurement of Cost Behavior

Cost Management Systems and Activity-Based Costing

Relevant Information for Decision Making With a Focus on Pricing Decisions

Relevant Information for Decision Making With a Focus on Operational Decisions

Introduction to Budgets and Preparing the Master Budget

Flexible Budgets and Variance Analysis

Management Control Systems and Responsibility Accounting

Management Control in Decentralized Organizations

Capital Budgeting

Cost Allocation

Accounting for Overhead Costs

Job-Order Costing and Process-Costing Systems

Understanding Corporate Annual Reports: Basic Financial Statements

Understanding and Analyzing Consolidated Financial Statements

Filters

Exam 15: Basic Accounting: Concepts, techniques, and Conventions

On March 1,a landlord received $10,000 rent for the month of April.On April 1,the landlord will ________.

In order for the board of directors of a corporation to declare a cash dividend,there must be sufficient ________ and ________.

Depreciation expense is recorded for ________.

Which of the following statements is FALSE?

The materiality concept is not subjective.

Increases in ownership claims arising from the delivery of goods are called ________.

Which financial statement summarizes the operating performance of a company over a period of time?

The ownership claim arising from the reinvestment of previous profits is called ________.

Rent received in advance of the rental period would be considered to be a prepaid asset by the landlord.

Amounts owed to vendors for purchases on credit are called ________.Amounts due from customers for credit sales are called ________.

A transaction is any event that affects the financial position of an organization and requires recording.

Under accrual basis accounting,we record revenue when ________.

The matching concept matches ________ and ________.

Retained earnings indicate the amount of cash available for distribution to shareholders.

The board of directors of Schwinn Company declared a cash dividend.Two weeks later,the dividend was disbursed to stockholders.The dividend disbursement will ________.

Managerial Accounting,the Business Organization,and Professional Ethics

Introduction to Cost Behavior and Cost Volume Profit Relationships

Measurement of Cost Behavior

Cost Management Systems and Activity-Based Costing

Relevant Information for Decision Making With a Focus on Pricing Decisions

Relevant Information for Decision Making With a Focus on Operational Decisions

Introduction to Budgets and Preparing the Master Budget

Flexible Budgets and Variance Analysis

Management Control Systems and Responsibility Accounting

Management Control in Decentralized Organizations

Capital Budgeting

Cost Allocation

Accounting for Overhead Costs

Job-Order Costing and Process-Costing Systems

Understanding Corporate Annual Reports: Basic Financial Statements

Understanding and Analyzing Consolidated Financial Statements

Filters

In order for the board of directors of a corporation to declare a cash dividend,there must be sufficient and .

Amounts owed to vendors for purchases on credit are called .Amounts due from customers for credit sales are called .

The matching concept matches and .