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: If the balance in the Cash account were used to buy more equipment, then the total assets would

Generally accepted accounting principles encompass the conventions, rules, and procedures necessary to define accepted accounting practice at a particular time.

Use this information to answer the following question. Here is the balance sheet for Abbot Box Company: If the equipment were sold for $13,000, then the Jill Abbot, Capital account would

Accountants consider money the common unit of measure for all business transactions.

The purchase of land is an example of a(n)

Companies whose securities are sold to the general public must adhere to standards established by the Securities and Exchange Commission.

Kalis Company's owner's equity equals one-third of the company's total assets. The company's liabilities are $120,000. What is the amount of the company's owner's equity?

Which of the following is a regulatory agency?

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

Which of the following items has no effect on owner's equity?

All of the following statements are true about the Sarbanes-Oxley Act except

Owner withdrawals are an example of an expense.

Which of the following is the most appropriate and modern definition of accounting?

Liquidity means having enough funds on hand to pay debts when they fall due.

Buying and selling goods and services are examples of operating activities.

The International Accounting Standards Board is the primary and most important determinant of generally accepted accounting principles.

The processing stage of accounting is accomplished by the recording of data.

What is the responsibility of the independent auditor? Who is responsible for the content of the published financial statements?

The separate entity concept requires that

Which four types of transactions affect owner's equity, and how do they affect it?