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Exam 1: An Introduction to Accounting

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Question 61

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If a corporation issued common stock for $20,000 cash,in which section of the statement of cash flows would this transaction be reported?

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Question 62

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As of December 31,2009,Bueno Company had $1,000 in liabilities,$8,000 in common stock,and $2,500 in retained earnings.The total amount of assets on that date is

A) $10,000.
B) $12,500.
C) $11,500.
D) $7,500.

E) B) and D)
F) None of the above

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Question 63

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The following transactions apply to Springfield Consulting Services in 2012: 1.issued stock to investors,$40,000 2.borrowed cash from bank,$10,000 3.purchased land for cash,$12,000 4.provided services to customers for cash,$60,000 5.paid $8,000 for rent 6.paid $35,000 for salaries 7.paid $2,000 for supplies used during the year 8.paid $5,000 dividends to owners 9.repaid $4,000 of loan described in item 2 Required: Prepare a statement of cash flows for 2012.The company started operations on January 1,2012.

If a company's expenses are greater than its revenues for the year,

Liu Corporation received $105,000 cash from earning revenue.

Ruiz Company sold land for $25,000 cash.The original cost of the land was $25,000.Select the answer that indicates how this event would affect the company's financial statements.

The term "articulation"

Ling Corporation paid a $4,000 cash dividend to its owners.

Wade Corporation paid its monthly utility bill of $850.

What is meant by "reporting entity?" How does the identification of the reporting entity affect accounting practice?

Porter Company experienced the following events during the year: 1.Acquired $40,000 cash by issuing common stock 2.Borrowed $10,000 cash from a creditor 3.Provided services to customers for $25,000 cash 4.Paid $18,000 cash for operating expenses 5.Paid a cash dividend of $1,000 to stockholders 6.Purchased equipment with cash,$6,000 Required: a)Show how each of these events affects the accounting equation.Show amounts and increases or decreases,using + for increases and - for decreases and NA for no effect.The first event is done as an example. b)Calculate the total amount of assets,liabilities,common stock,and retained earnings at the end of the period.

The accounting term "reliability" means that information is consistent from one accounting period to the next.

During the year,WXY Company issued common stock to stockholders for $6,000,purchased land for $1,600 cash,and paid cash dividends of $500 to the company's owners.Enter each of these three events into the horizontal financial statements model,below.Indicate dollar amounts of increases and decreases.For cash flows,show whether they are operating activities (OA),investing activities (IA),or financing activities (FA).

Retained Earnings is

Garza Corporation acquired land by issuing a note payable (a liability).

A creditor

If a company receives cash for providing services to customers,that transaction is

ABC Company acquired $23,000 by issuing common stock to investors.Which of the following choices accurately reflects how this event would affect the company's financial statement?

Hill Corporation earned cash revenues of $12,000.

Which financial statement matches asset increases from operating a business with asset decreases from operating the business?