Exam 1: Uses of Accounting Information and the Financial Statements

Use this information to answer the following question. Here is the balance sheet for Abbot Box Company,Inc.: If the balance in the Cash account were used to buy more equipment,then the total assets would

Taxing authorities are considered accounting information users with an indirect financial interest.

Obtaining funds from a bank is an example of an investing activity.

The accounting fees earned by an accounting firm would appear on its balance sheet.

Management accounting focuses on external decision making.

What is independence,and why is it important for a CPA to maintain it when conducting an audit?

Authorized shares of stock refer to the number of shares currently held by the stockholders.

How does the statement of retained earnings relate to the income statement and the balance sheet?

Financial position may be assessed by referring to a balance sheet.

Stockholders' equity equals contributed capital plus retained earnings.

At the beginning of the year,Peters Corporation's assets were $150,000 and its stockholders' equity was $100,000.During the year,assets decreased $30,000 and liabilities increased $15,000.What was the stockholders' equity at the end of the year?

Cash is another term for retained earnings.

Which of the following groups uses accounting information primarily to help protect the public?

Two major goals of business are to achieve profitability and to achieve liquidity.

Dividends of a corporation are declared by its

All of the following will affect retained earnings except

Exchange rates for currency change daily according to the supply and demand for each currency.

The terms bookkeeping and accounting are synonymous.

The net income figure appears in all the following financial statements except the

A major function of management is to provide the accountant with relevant and useful information.