Question 1

A company has liabilities of $475,000 and equity of $925,000. What is the amount of its assets?

Accepted Answer

Assets = $...

Question 2

Bookkeeping is the sole purpose of accounting.

Accepted Answer

A) True 
 B)False

Question 3

A corporation purchased a $40,000 delivery truck by paying 4,000 cash and signing a $36,000 note payable. Immediately prior to this transaction the corporation had assets, liabilities, and owners' equity in the amounts of $75,000, $52,000, and $23,000 respectively. What is the total amount of the corporation's assets after this transaction has been recorded?

Accepted Answer

A)   $115,000
B)   $111,000
C)   $79,000
D)   $71,000
E)   $75,000F) A) and B)
G) D) and E)

Question 4

Net income:

Accepted Answer

A)   Occurs when revenues exceed expenses.
B)   Is the same as revenue.
C)   Equals resources owned or controlled by a company.
D)   Occurs when expenses exceed assets.
E)   Represents assets taken from a company for an owner's personal use.F) A) and E)
G) A) and C)

Question 5

The balance sheet shows whether or not the firm achieved its primary objective of earning a profit.

Accepted Answer

A) True 
 B)False

Question 6

Risk is:

Accepted Answer

A)   Net income divided by average total assets.
B)   The reward for investment.
C)   The uncertainty about the expected return that will be earned from an investment.
D)   Unrelated to expected return.
E)   Derived from the idea of getting something back from an investment.F) A) and D)
G) All of the above

Question 7

Reebok's net income of $119 million and average assets of $1,400 million results in a return on assets of 8.5%.

Accepted Answer

A) True 
 B)False

Question 8

Below is accounting information for Cascade Company for 2013, its first year of business
  Revenue $416,000 Cash $120,000 Common stock $200,000 Expenses $300,000 Equipment $240,000 Accounts receivable $35,000 Notes payable $50,000 Notes receivable $62,000\begin{array}{|l|r|}\hline 	ext { Revenue } & \$ 416,000 \\hline 	ext { Cash } & \$ 120,000 \\hline 	ext { Common stock } & \$ 200,000 \\hline 	ext { Expenses } & \$ 300,000 \\hline 	ext { Equipment } & \$ 240,000 \\hline 	ext { Accounts receivable } & \$ 35,000 \\hline 	ext { Notes payable } & \$ 50,000 \\hline 	ext { Notes receivable } & \$ 62,000 \\hline\end{array} Revenue  Cash  Common stock  Expenses  Equipment  Accounts receivable  Notes payable  Notes receivable ​$416,000$120,000$200,000$300,000$240,000$35,000$50,000$62,000​​  What was total equity at year end?

Accepted Answer

A)   $320,000
B)   $296,000
C)   $316,000
D)   $457,000
E)   $116,000 F) B) and D)
G) A) and E)

Question 9

FastForward paid $6,000 in dividends. This amount should be included as an expense on the income statement.

Accepted Answer

A) True 
 B)False

Question 10

The accounting principle that requires accounting information to be based on actual cost and requires assets and services to be recorded initially at the amount of cash or cash equivalent given in exchange is the:

Accepted Answer

A)   Accounting equation
B)   Cost principle
C)   Going-concern principle
D)   Realization principle
E)   Business entity principleF) B) and E)
G) A) and C)

Question 11

Explain why ethics are an integral part of accounting.

Accepted Answer

The purpose of accounting is to provide ...

Question 12

The statement of cash flows reports on cash flows for:

Accepted Answer

A)   Operating activities
B)   Revenue activities
C)   Expense activities
D)   Planning activities
E)   Equity activitiesF) A) and D)
G) A) and E)

Question 13

The financial statement that describes where a company's cash came from and how it was spent during the period is the:

Accepted Answer

A)   Statement of financial position.
B)   Statement of cash flows.
C)   Balance sheet.
D)   Income statement.
E)   Statement of retained earnings.F) A) and E)
G) D) and E)

Question 14

Beginning assets were $437,600, beginning liabilities were $262,560, common stock issued during the year totaled $45,000, revenue for the year was $414,250, expenses for the year were $280,000, dividends declared was $22,700, and ending liabilities is   $$350,000. What was the beginning equity for the year?

Accepted Answer

A)   $700,160
B)   $787,600
C)   $187,600
D)   $612,560
E)   $175,040 F) A) and D)
G) C) and D)

Question 15

FastForward has net income of $18,955 and assets at the beginning of the year of $200,000. Its assets at the end of the year total $246,000. Compute its return on assets.

Accepted Answer

A)   7.7%
B)   8.5%
C)   9.5%
D)   11.8%
E)   13.0%F) B) and E)
G) D) and E)

Question 16

On May 1, Chuck Taylor formed FastForward, a shoe consulting business as a corporation. To start the business he invested $750,000 in cash. Enter the appropriate amounts for this transaction into the accounting equation format shown below:
 $\begin{array}{|c|c|c|}
\hline \text { Assets }= & \text { Liabilities + } & \text { Equity } \
\hline & & \
\hline
\end{array}$

Accepted Answer

The answer of On May 1, Chuck Taylor formed FastForward,...

Question 17

Accounts payable appear on which of the following statements?

Accepted Answer

A)   Balance sheet.
B)   Income statement.
C)   Statement of retained earnings.
D)   Statement of cash flows.
E)   Transaction statement.F) B) and C)
G) A) and E)

Question 18

Match between columns
                        Premises:  Monitor costs and ensure quality.
 Judge the soundness of a customer before making sales on credit.
 Measuring risk and return of loans.
 Assessing employment opportunities.
 Assessing the risk and return of acquiring shares.

Accepted Answer

The Answer of Production managers and Suppliers and Employees and is...

Question 19

Match between columns
                        Premises: The excess of revenue over expenses.
Area of accounting aimed at serving external users.
A financial ratio useful in evaluating management, analyzing, and forecasting profits and planning activities.
Those happenings that affect an entity's accounting equation and can be reliably measured.
The uncertainty about the expected return to be earned.
Costs of assets or services used to earn revenues.
Defining the idea, goals, and actions of an organization.
Amount received from selling products and services.
Creditors' claims on a company's assets.
Area of accounting aimed at serving the decision-making needs of internal users.

Accepted Answer

The Answer of Events and Financial accounting and Expenses and is...

Question 20

A company spent $52,000 in cash for this period's advertising activities. Enter the appropriate amounts for this transaction into the accounting equation format shown below:
 $$\begin{array} { | c | c | c | } 
\hline \text { Assets } = & \text { Liabilities } + & \text { Equity } \
\hline & & \
\hline
\end{array}$$

Accepted Answer

The answer of A company spent $52,000 in cash for...

Exam 1: Introducing Financial Accounting

Reebok's net income of $119 million and average assets of $1,400 million results in a return on assets of 8.5%.

Correct Answer
verified

A company has liabilities of $475,000 and equity of $925,000. What is the amount of its assets?

Correct Answer
verified
Assets = $...
View Answer

Correct Answer
verified

FastForward paid $6,000 in dividends. This amount should be included as an expense on the income statement.

Correct Answer
verified

The following is a list of selected users of accounting information. Match the information needs to the following appropriate user:

The balance sheet shows whether or not the firm achieved its primary objective of earning a profit.

Correct Answer
verified

Explain why ethics are an integral part of accounting.

Correct Answer
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The purpose of accounting is to provide ...
View Answer

Correct Answer
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Correct Answer
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Accounts payable appear on which of the following statements?

Correct Answer
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Correct Answer
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The accounting principle that requires accounting information to be based on actual cost and requires assets and services to be recorded initially at the amount of cash or cash equivalent given in exchange is the:

Correct Answer
verified

Risk is:

Correct Answer
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FastForward has net income of $18,955 and assets at the beginning of the year of $200,000. Its assets at the end of the year total $246,000. Compute its return on assets.

Correct Answer
verified

Bookkeeping is the sole purpose of accounting.

Correct Answer
verified

The financial statement that describes where a company's cash came from and how it was spent during the period is the:

Correct Answer
verified

Net income:

Correct Answer
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Correct Answer
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Match each of the following terms with the most appropriate definition:

The statement of cash flows reports on cash flows for:

Correct Answer
verified

Exam 1: Introducing Financial Accounting

Reebok's net income of $119 million and average assets of $1,400 million results in a return on assets of 8.5%.

Correct AnswerverifiedShow Answer

A company has liabilities of $475,000 and equity of $925,000. What is the amount of its assets?

Correct AnswerverifiedAssets = $...View AnswerShow Answer

Correct AnswerverifiedShow Answer

FastForward paid $6,000 in dividends. This amount should be included as an expense on the income statement.

Correct AnswerverifiedShow Answer

The following is a list of selected users of accounting information. Match the information needs to the following appropriate user:

The balance sheet shows whether or not the firm achieved its primary objective of earning a profit.

Correct AnswerverifiedShow Answer

Explain why ethics are an integral part of accounting.

Correct AnswerverifiedThe purpose of accounting is to provide ...View AnswerShow Answer

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Accounts payable appear on which of the following statements?

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The accounting principle that requires accounting information to be based on actual cost and requires assets and services to be recorded initially at the amount of cash or cash equivalent given in exchange is the:

Correct AnswerverifiedShow Answer

Risk is:

Correct AnswerverifiedShow Answer

FastForward has net income of $18,955 and assets at the beginning of the year of $200,000. Its assets at the end of the year total $246,000. Compute its return on assets.

Correct AnswerverifiedShow Answer

Bookkeeping is the sole purpose of accounting.

Correct AnswerverifiedShow Answer

The financial statement that describes where a company's cash came from and how it was spent during the period is the:

Correct AnswerverifiedShow Answer

Net income:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Match each of the following terms with the most appropriate definition:

The statement of cash flows reports on cash flows for:

Correct AnswerverifiedShow Answer

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Assets = $...
View Answer

Correct Answer
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The purpose of accounting is to provide ...
View Answer

Correct Answer
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