Question 1

If the liabilities of a company increased $74,000 during a period of time and equity in the company decreased $19,000 during the same period,what was the effect on the assets?

Accepted Answer

A)   Assets would have increased $55,000.
B)   Assets would have decreased $55,000.
C)   Assets would have increased $19,000.
D)   Assets would have decreased $19,000.
E)   None of the choices are correct.F) A) and C)
G) None of the above

Question 2

Determine the net income of a company for which the following information is available for the month of July.
  Employee salaries expense$180,000Interest expense 10,000 Rent expense 20,000 Consulting revenue 400,000\begin{array}{llr}  	ext {  Employee salaries expense} &\$180,000\ 	ext {Interest expense  } &10,000\ 	ext { Rent expense } &20,000\ 	ext { Consulting revenue } &400,000\\end{array} Employee salaries expenseInterest expense  Rent expense  Consulting revenue ​$180,00010,00020,000400,000​

Accepted Answer

A)   $190,000.
B)   $210,000.
C)   $230,000.
D)   $400,000.
E)   $610,000. F) A) and B)
G) B) and E)

Question 3

If a company paid $38,000 of its accounts payable in cash,what was the effect on the accounting equation?

Accepted Answer

A)   Assets would decrease $38,000, liabilities would decrease $38,000, and equity would decrease $38,000.
B)   Assets would decrease $38,000, liabilities would decrease $38,000, and equity would increase $38,000.
C)   Assets would decrease $38,000, liabilities would decrease $38,000, and equity remains unchanged.
D)   There would be no effect on the accounts because the accounts are affected by the same amount.
E)   Assets would increase $38,000 and liabilities would decrease $38,000.F) A) and E)
G) A) and D)

Question 4

The Sarbanes-Oxley Act (SOX)does not require public companies to apply both accounting oversight and stringent internal controls.

Accepted Answer

A) True 
 B)False

Question 5

The accounting concept that requires financial statement information to be supported by independent,unbiased evidence is:

Accepted Answer

A)   Business entity assumption.
B)   Revenue recognition principle.
C)   Going-concern assumption.
D)   Time-period assumption.
E)   Objectivity principle.F) A) and B)
G) None of the above

Question 6

Data for Kennedy Realty are as follows:
 $$\begin{array} { l r } 
\text { Total assets at January 1 } & \$ 100,000 \
\text { Total liabilities at January 1 } & 35,000 \
\text { Common stock at January 1 } & 50,000 \
\text { Total revenues for the year } & 79,000 \
\text { Total expenses for the year } & 47,000
\end{array}$$ 
Cash dividends of $30,000 were paid to its sole stockholder,Finn Kennedy,during the year.No stock was issued during the year.Using the above data,prepare Kennedy Realty's Statement of Retained Earnings for the year ended December 31.

Accepted Answer

The answer of Data for Kennedy Realty are as follows:
...

Question 7

At the beginning of the period,a company had $350,000 worth of assets,$110,000 worth of liabilities,and $240,000 worth of equity.Assume the only change during the period was a $30,000 purchase of equipment by issuing a note payable.Show the accounting equation with the appropriate amounts at the end of the period.

Accepted Answer

$380,000 =...

Question 8

The income statement describes revenues earned and expenses incurred along with the resulting net income or loss over a specified period of time,due to earnings activities.

Accepted Answer

A) True 
 B)False

Question 9

The ________ describes a company's revenues and expenses along with the resulting net income or net loss over a period of time due to earnings activities.

Accepted Answer

The answer of The ________ describes a company's revenues and...

Question 10

The full disclosure principle:

Accepted Answer

A)   Prescribes that accounting information is based on actual cost.
B)   Provides guidance on when a company must recognize revenue.
C)   Prescribes that a company report the details behind financial statements that would impact users' decisions.
D)   Prescribes that a company record the expenses it incurred to generate the revenue reported.
E)   Means that accounting information reflects a presumption that the business will continue operating instead of being closed or sold.F) A) and D)
G) B) and C)

Question 11

U.S.Government Treasury bonds provide low return and low risk to investors.

Accepted Answer

A) True 
 B)False

Question 12

Objectivity means that financial information is supported by independent,unbiased evidence; it demands more than a person's opinion.

Accepted Answer

A) True 
 B)False

Question 13

Resources such as cash distributed to the owners of a corporation are called ________.

Accepted Answer

The answer of Resources such as cash distributed to the...

Question 14

The rule that (1) requires revenue to be recognized at the time it is earned, (2) allows the inflow of assets associated with revenue to be in a form other than cash,and (3) measures the amount of revenue as the cash plus the cash equivalent value of any noncash assets received from customers in exchange for goods or services,is called the:

Accepted Answer

A)   Going-concern assumption.
B)   Measurement (Cost)  principle.
C)   Revenue recognition principle.
D)   Objectivity principle.
E)   Business entity assumption.F) A) and D)
G) A) and C)

Question 15

Risk is:

Accepted Answer

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

Question 16

A common characteristic of ________ is their ability to yield expected future benefits to a business.

Accepted Answer

The answer of A common characteristic of ________ is their...

Question 17

Match the following terms with the appropriate definition.
-Revenue recognition principle

Accepted Answer

A)  The principle that assumes transactions and events can be expressed in money units.
B)  The cost of assets or services used to earn revenue.
C)  The principle that requires a business to be accounted for separately from its owners.
D)  Describes a company's revenues and expenses along with the resulting net income or loss over a period of time.
E)  Creditor's claims on assets.F) The relation between a company's assets, liabilities, and equity.G) The principle that revenue is recorded when earned through providing goods or services.H) A financial statement that lists cash inflows (receipts)  and cash outflows (payments) ; the cash flows are arranged by operating, investing, and financing activities.I) Happenings, such as changes in market value, that effect the accounting equation and are reliably measured.J) None of the above
K) A) and E)

Question 18

Owner financing refers to resources contributed by creditors or lenders.

Accepted Answer

A) True 
 B)False

Question 19

Doc's Ribhouse had beginning equity of $52,000; net income of $35,000,and dividends of $12,000.There were no stockholder investments during the year.Calculate the ending equity.

Accepted Answer

A)   $(5,000) .
B)   $29,000.
C)   $5,000.
D)   $99,000.
E)   $75,000.F) A) and B)
G) B) and D)

Question 20

The ________ principle requires that financial information is supported by independent,unbiased evidence.

Accepted Answer

The answer of The ________ principle requires that financial information...

Exam 1: Accounting in Business

Correct Answer
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Correct Answer
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$380,000 =...
View Answer

Match the following terms with the appropriate definition. -Revenue recognition principle

Correct Answer
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A common characteristic of ________ is their ability to yield expected future benefits to a business.

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The full disclosure principle:

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Determine the net income of a company for which the following information is available for the month of July. $\begin{array}{llr} \text { Employee salaries expense} &\$180,000\\ \text {Interest expense } &10,000\\ \text { Rent expense } &20,000\\ \text { Consulting revenue } &400,000\\\end{array}$

Correct Answer
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If a company paid $38,000 of its accounts payable in cash,what was the effect on the accounting equation?

Correct Answer
verified

Resources such as cash distributed to the owners of a corporation are called ________.

Correct Answer
verified

The ________ describes a company's revenues and expenses along with the resulting net income or net loss over a period of time due to earnings activities.

Correct Answer
verified

The ________ principle requires that financial information is supported by independent,unbiased evidence.

Correct Answer
verified

Objectivity means that financial information is supported by independent,unbiased evidence; it demands more than a person's opinion.

Correct Answer
verified

The income statement describes revenues earned and expenses incurred along with the resulting net income or loss over a specified period of time,due to earnings activities.

Correct Answer
verified

The accounting concept that requires financial statement information to be supported by independent,unbiased evidence is:

Correct Answer
verified

Correct Answer
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U.S.Government Treasury bonds provide low return and low risk to investors.

Correct Answer
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Risk is:

Correct Answer
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Owner financing refers to resources contributed by creditors or lenders.

Correct Answer
verified

Doc's Ribhouse had beginning equity of $52,000; net income of $35,000,and dividends of $12,000.There were no stockholder investments during the year.Calculate the ending equity.

Correct Answer
verified

The Sarbanes-Oxley Act (SOX)does not require public companies to apply both accounting oversight and stringent internal controls.

Correct Answer
verified

If the liabilities of a company increased $74,000 during a period of time and equity in the company decreased $19,000 during the same period,what was the effect on the assets?

Correct Answer
verified

Exam 1: Accounting in Business

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Correct Answerverified$380,000 =...View AnswerShow Answer

Match the following terms with the appropriate definition. -Revenue recognition principle

Correct AnswerverifiedShow Answer

A common characteristic of ________ is their ability to yield expected future benefits to a business.

Correct AnswerverifiedShow Answer

The full disclosure principle:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If a company paid $38,000 of its accounts payable in cash,what was the effect on the accounting equation?

Correct AnswerverifiedShow Answer

Resources such as cash distributed to the owners of a corporation are called ________.

Correct AnswerverifiedShow Answer

The ________ describes a company's revenues and expenses along with the resulting net income or net loss over a period of time due to earnings activities.

Correct AnswerverifiedShow Answer

The ________ principle requires that financial information is supported by independent,unbiased evidence.

Correct AnswerverifiedShow Answer

Objectivity means that financial information is supported by independent,unbiased evidence; it demands more than a person's opinion.

Correct AnswerverifiedShow Answer

The income statement describes revenues earned and expenses incurred along with the resulting net income or loss over a specified period of time,due to earnings activities.

Correct AnswerverifiedShow Answer

The accounting concept that requires financial statement information to be supported by independent,unbiased evidence is:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

U.S.Government Treasury bonds provide low return and low risk to investors.

Correct AnswerverifiedShow Answer

Risk is:

Correct AnswerverifiedShow Answer

Owner financing refers to resources contributed by creditors or lenders.

Correct AnswerverifiedShow Answer

Doc's Ribhouse had beginning equity of $52,000; net income of $35,000,and dividends of $12,000.There were no stockholder investments during the year.Calculate the ending equity.

Correct AnswerverifiedShow Answer

The Sarbanes-Oxley Act (SOX)does not require public companies to apply both accounting oversight and stringent internal controls.

Correct AnswerverifiedShow Answer

If the liabilities of a company increased $74,000 during a period of time and equity in the company decreased $19,000 during the same period,what was the effect on the assets?

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
verified
$380,000 =...
View Answer

Correct Answer
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Correct Answer
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