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Exam 1: An Introduction to Accounting

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Question 21

Multiple Choice

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An asset decrease resulting from consumption of resources to earn revenue is

A) a net loss.
B) a liability.
C) an expense.
D) an asset source transaction.

E) A) and B)
F) A) and C)

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Question 22

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Accounting information focused on the needs of external users is

A) financial accounting.
B) managerial accounting.
C) claims accounting.
D) not-for-profit accounting.

E) All of the above
F) B) and D)

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Question 23

Multiple Choice

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Radium Company earned $15,000 of cash revenue.Which of the following choices accurately reflects how this event would affect the company's financial statements?

Each of the following requirements is independent of the others. a)Bruno Corporation has liabilities of $80,000 and equity of $110,000.What is the amount of Bruno's assets? ________________________________________________ b)Wilder Company has assets of $320,000 and liabilities of $100,000.What is the amount of equity? ______________________________________________________ c)Limon Company has assets of $90,000 and liabilities of $40,000.What is the amount of claims? _____________________________________________________________

The claims side of the accounting equation

An asset source transaction increases a business's assets and the claims to assets.

A business's equity comes from

The sources of a business's assets are liabilities and distributions to owners.

Howard Corporation paid a $3,000 cash dividend to its stockholders.

Most assets must be reported on the balance sheet at

The balance sheet for Raymond Company shows total assets of $4,000,liabilities of $1,500,and retained earnings of $1,200.Based on this information,the amount of common stock must be

Pardee Company earned $25,000 of cash revenue.What kind of transaction is this?

What was the cash flow from financing activities?

Fill in the missing information by identifying dollar amounts a,b,c,and d.All transactions were for cash.

An investor provides resources to a business in exchange for

Accounts are subclassifications of the various elements of the financial statements.

Use the following information to prepare an income statement for Burleson Company for the year ended December 31,2012. 1.revenue from services,$28,000 2.paid $10,000 cash for land 3.paid operating expenses,$21,000 4.paid dividends to stockholders,$4,000 5.issued $6,000 of common stock for cash

Accounting information is said to be reliable if

Bridges Company earned $4,000 in cash revenues,paid cash expenses of $3,450,and paid a cash dividend of $300 to its owners.It engaged in no other transactions during the period.Which of the following statements is true?

A company's retained earnings at the beginning and ending of the accounting period were $48,000 and $55,000,respectively.If the company had revenues of $61,000 and expenses of $50,000,the amount of cash dividends paid must have been