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Exam 1: Introducing Accounting in Business

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Question 41

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Beginning Assets were $700,000, Beginning Equity was $225,000, Revenue for the year was $523,000, Common Stock sold during the year totaled $320,000, Expenses for the year were $392,000, Ending Equity is $751,000, and Ending Assets are $963,000. What were the Beginning Liabilities for the year?

A) $738,000
B) $998,000
C) $131,000
D) $203,000
E) $475,000

F) A) and B)
G) A) and C)

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Question 42

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Identify the three basic forms of business organizations.

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The three basic forms of busin...

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Question 43

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Below is accounting information for Cascade Company for 2010: $\begin{array} { | l | r | } \hline \text { Revenue } & \$ 416,000 \\\hline \text { Cash } & \$ 120,000 \\\hline \text { Common Stock } & \$ 200,000 \\\hline \text { Expenses } & \$ 300,000 \\\hline \text { Equipment } & \$ 240,000 \\\hline \text { Accounts Receivable } & \$ 35,000 \\\hline \text { Notes Payable } & \$ 50,000 \\\hline \text { Notes Receivable } & \$ 62,000 \\\hline\end{array}$ What was Net Income for the year?

Identify and describe the three major activities of a business organization.

The amounts reported in the accounts for assets used in operations are based on their costs. This practice is best justified by the:

Accounts payable appear on which of the following statements?

A corporation:

Describe the three important guidelines for revenue recognition.

The Securities and Exchange Commission (SEC) is an agency of the federal government that establishes reporting requirements for companies that issue stock to the public.

Beginning Assets were $700,000, Beginning Equity was $225,000, Revenue for the year was $523,000, Common Stock sold during the year totaled $320,000, Expenses for the year were $392,000, Ending Equity is $751,000, and Ending Assets are $963,000. What is Net Income for the year?

If assets are $365,000 and equity is $120,000, then liabilities are:

Creditors' claims on the assets of a company are called:

The characteristics below apply to at least one of the forms of business organization. a. Is a separate legal entity? b. Is allowed to be owned by one person only? c. Owner or owners are personally liable for debts of the business d. Is a taxable entity? e. Is a business entity? f. May have a contract specifying the division of profits among the owners? g. Has an unlimited life. Use the following format to indicate (with a "yes" or "no") whether or not a characteristic applies to each type of business organization. $\begin{array} { | l | l | l | l | } \hline & \text { Proprietorship } & \text { Partnership } & \text { Corporation } \\\hline \text { a } & & & \\\hline \text { b } & & & \\\hline \text { c } & & & \\\hline \text { d } & & & \\\hline \text { e } & & & \\\hline \text { f } & & & \\\hline \text { g } & & & \\\hline\end{array}$

A balance sheet lists:

Bert and John Jacobs are the owners of the Life is good T-shirt company. If they also own a personal collection of vintage bobble heads valued at $25,000, how would the bobble heads be reflected on the company books? State the accounting concept or principle which supports your answer.

The accounting equation can be restated as: Assets - Equity = Liabilities.

Halley Burton began a Web Consulting practice as a corporation and completed these transactions during September of the current year. Show the effects of the above transactions on the accounting equation of Web Consulting. Use the following format for your answers. The first item is shown as an example. Increase = I Decrease = D No effect = N

The records of Skymaster Airplane Rentals show the following information as of December 31, 2011 Dividends of $52,000 were paid during 2011. Using the above information, prepare an income statement for 2011.

Explain the role of accounting in the information age.

The three major activities of a business are operating, investing and financing.