Question 1

If Liabilities have a balance of $10,000 and Stockholders' Equity has a balance of $60,000,then Assets must have a balance of

Accepted Answer

A) $50,000. 
B) $60,000. 
C) $70,000. 
D) $10,000. 
A) $50,000. 
B) $60,000. 
C) $70,000. 
D) $10,000.

Question 2

Which of the following is NOT considered to be a liability?

Accepted Answer

A) Note payable 
B) Accounts receivable 
C) Unearned revenues 
D) Accounts payable 
A) Note payable 
B) Accounts receivable 
C) Unearned revenues 
D) Accounts payable

Question 3

The basic financial statements do NOT include the

Accepted Answer

A) income statement. 
B) tax return. 
C) balance sheet. 
D) statement of cash flows. 
A) income statement. 
B) tax return. 
C) balance sheet. 
D) statement of cash flows.

Question 4

Which of the following is NOT an element of the financial accounting system?

Accepted Answer

A) A set of rules for determining the recording of economic events 
B) A framework for preparing financial statements 
C) A set of rules for the stock exchange 
D) Controls to determine whether errors occur during recording 
A) A set of rules for determining the recording of economic events 
B) A framework for preparing financial statements 
C) A set of rules for the stock exchange 
D) Controls to determine whether errors occur during recording

Question 5

ABC Company deposited $20,000 in a bank account in return for issuing shares in the corporation.This transaction would affect which two financial statement elements?

Accepted Answer

A) Assets and stockholders' equity 
B) Assets and liabilities 
C) Liabilities and stockholders' equity 
D) None of these 
A) Assets and stockholders' equity 
B) Assets and liabilities 
C) Liabilities and stockholders' equity 
D) None of these

Question 6

Buying equipment for cash affects which accounts?

Accepted Answer

A) Cash only 
B) Retained earnings only 
C) Equipment and retained earnings 
D) Cash and equipment 
A) Cash only 
B) Retained earnings only 
C) Equipment and retained earnings 
D) Cash and equipment

Question 7

If Assets have a balance of $40,000 and Stockholders' Equity has a balance of $30,000,then Liabilities must have a balance of

Accepted Answer

A) $70,000. 
B) $30,000. 
C) $40,000. 
D) $10,000. 
A) $70,000. 
B) $30,000. 
C) $40,000. 
D) $10,000.

Question 8

The accounting equation "Assets = Liabilities + Stockholders' Equity" is affected by transactions.Is it possible to have a transaction that only impacts one financial element of the equation? Two elements? Give examples.

Accepted Answer

Yes to both questions.Examples

Question 9

Paying expenses affects which financial statement elements?

Accepted Answer

A) Assets only 
B) Stockholders' equity only 
C) Assets and stockholders' equity 
D) Assets and liabilities 
A) Assets only 
B) Stockholders' equity only 
C) Assets and stockholders' equity 
D) Assets and liabilities

Question 10

BNC Company earns revenues and as a result collects cash.Which of the following financial statement elements are increased?

Accepted Answer

A) Cash only 
B) Stockholders' equity only 
C) Liabilities 
D) Cash and stockholders' equity 
A) Cash only 
B) Stockholders' equity only 
C) Liabilities 
D) Cash and stockholders' equity

Question 11

For EFG Co. ,the transaction "Receipt of interest income" would

Accepted Answer

A) increase total assets. 
B) decrease total assets. 
C) have no effect on total assets. 
D) decrease total liabilities. 
A) increase total assets. 
B) decrease total assets. 
C) have no effect on total assets. 
D) decrease total liabilities.

Question 12

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

Accepted Answer

A) Paid for supplies with cash 
B) Borrowed money from Second National Bank 
C) Received money for fees earned 
D) Received a utility bill 
A) Paid for supplies with cash 
B) Borrowed money from Second National Bank 
C) Received money for fees earned 
D) Received a utility bill

Question 13

Revenues decrease stockholders' equity.

Accepted Answer

A) True 
 B)False

Question 14

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

Accepted Answer

A) True 
 B)False

Question 15

How can a company earn a large net income and have a small balance in retained earnings?

Accepted Answer

The company may pay

Question 16

Hodges,Inc.had the following assets and liabilities as of September 30,2011:
 
If assets increased by $3,914 and equity increased by $2,290,what is the increase or decrease in liabilities of Hodges as of October 31,2011?

Accepted Answer

A) ($1,624) 
B) $1,624 
C) $6,204 
D) ($6,204) 
A) ($1,624) 
B) $1,624 
C) $6,204 
D) ($6,204)

Question 17

Which of the following statements is NOT true about liabilities?

Accepted Answer

A) Liabilities are debts owed to outsiders. 
B) Account titles of liabilities often include the term "payable." 
C) Cash received before services are performed is considered to be a liability. 
D) Liabilities do not include wages owed to employees of the company. 
A) Liabilities are debts owed to outsiders. 
B) Account titles of liabilities often include the term "payable." 
C) Cash received before services are performed is considered to be a liability. 
D) Liabilities do not include wages owed to employees of the company.

Question 18

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

Accepted Answer

A) True 
 B)False

Question 19

Any given transaction must affect at least two different parts of the accounting equation.

Accepted Answer

A) True 
 B)False

Question 20

Johnson,Inc.issued $15,000 in capital stock in exchange for cash.What is the effect of this transaction?

Accepted Answer

A) Total assets remain unchanged. 
B) Cash flow from Financing Activities will increase. 
C) Net Income will increase. 
D) Total Retained Earnings will increase. 
A) Total assets remain unchanged. 
B) Cash flow from Financing Activities will increase. 
C) Net Income will increase. 
D) Total Retained Earnings will increase.

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 is NOT considered to be a liability?

The basic financial statements do NOT include the

Which of the following is NOT an element of the financial accounting system?

ABC Company deposited $20,000 in a bank account in return for issuing shares in the corporation.This transaction would affect which two financial statement elements?

Buying equipment for cash affects which accounts?

If Assets have a balance of $40,000 and Stockholders' Equity has a balance of $30,000,then Liabilities must have a balance of

The accounting equation "Assets = Liabilities + Stockholders' Equity" is affected by transactions.Is it possible to have a transaction that only impacts one financial element of the equation? Two elements? Give examples.

Paying expenses affects which financial statement elements?

BNC Company earns revenues and as a result collects cash.Which of the following financial statement elements are increased?

For EFG Co. ,the transaction "Receipt of interest income" would

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

Revenues decrease stockholders' equity.

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

How can a company earn a large net income and have a small balance in retained earnings?

Hodges,Inc.had the following assets and liabilities as of September 30,2011: If assets increased by $3,914 and equity increased by $2,290,what is the increase or decrease in liabilities of Hodges as of October 31,2011?

Which of the following statements is NOT true about liabilities?

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

Any given transaction must affect at least two different parts of the accounting equation.

Johnson,Inc.issued $15,000 in capital stock in exchange for cash.What is the effect of this transaction?

The Role of Accounting in Business

Accrual Accounting Concepts

Accounting for Merchandising Businesses

Sarbanes-Oxley,internal Control,and Cash

Receivables and Inventories

Fixed Assets and Intangible Assets

Liabilities and Stockholders Equity

Financial Statement Analysis

Accounting Systems for Manufacturing Businesses

Cost Behavior and Cost-Volume-Profit Analysis

Differential Analysis and Product Pricing

Budgeting and Standard Cost Systems

Performance Evaluation for Decentralized Operations

Capital Investment Analysis

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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 is NOT considered to be a liability?

The basic financial statements do NOT include the

Which of the following is NOT an element of the financial accounting system?

ABC Company deposited $20,000 in a bank account in return for issuing shares in the corporation.This transaction would affect which two financial statement elements?

Buying equipment for cash affects which accounts?

If Assets have a balance of $40,000 and Stockholders' Equity has a balance of $30,000,then Liabilities must have a balance of

The accounting equation "Assets = Liabilities + Stockholders' Equity" is affected by transactions.Is it possible to have a transaction that only impacts one financial element of the equation? Two elements? Give examples.

Paying expenses affects which financial statement elements?

BNC Company earns revenues and as a result collects cash.Which of the following financial statement elements are increased?

For EFG Co. ,the transaction "Receipt of interest income" would

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

Revenues decrease stockholders' equity.

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

How can a company earn a large net income and have a small balance in retained earnings?

Hodges,Inc.had the following assets and liabilities as of September 30,2011: If assets increased by $3,914 and equity increased by $2,290,what is the increase or decrease in liabilities of Hodges as of October 31,2011?

Which of the following statements is NOT true about liabilities?

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

Any given transaction must affect at least two different parts of the accounting equation.

Johnson,Inc.issued $15,000 in capital stock in exchange for cash.What is the effect of this transaction?

The Role of Accounting in Business

Accrual Accounting Concepts

Accounting for Merchandising Businesses

Sarbanes-Oxley,internal Control,and Cash

Receivables and Inventories

Fixed Assets and Intangible Assets

Liabilities and Stockholders Equity

Financial Statement Analysis

Accounting Systems for Manufacturing Businesses

Cost Behavior and Cost-Volume-Profit Analysis

Differential Analysis and Product Pricing

Budgeting and Standard Cost Systems

Performance Evaluation for Decentralized Operations

Capital Investment Analysis

Filters