Question 1

Match between columns
                        Premises:  Statement of cash flows
 Events
 Monetary unit principle
 Business entity principle
 Revenue recognition principle
 Accounting equation
 Income statement
 Expenses
 Liabilities

Accepted Answer

The Answer of The relation between a company's assets, liabilities, is...

Question 2

If the liabilities of a business increased $75,000 during a period of time and the owner's equity in the business decreased $30,000 during the same period, the assets of the business must have:

Accepted Answer

A)   Decreased $105,000.
B)   Decreased $45,000.
C)   Increased $105,000.
D)   Increased $45,000.
E)   Increased $30,000.F) All of the above
G) A) and B)

Question 3

Match between columns
                        Premises:  Assets.
 Withdrawals.
 Revenues.
 Cash from investing activities.
 Expenses.
 Liabilities.
 Cash from operating activities.
 Cash from financing activities.

Accepted Answer

The Answer of Income statement and Statement of owner's equity is...

Question 4

Decreases in equity that represent costs of providing products or services to customers, used to earn revenues are called:

Accepted Answer

A)   Liabilities.
B)   Withdrawals.
C)   Equity.
D)   Owner's Investment.
E)   Expenses.F) All of the above
G) B) and D)

Question 5

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 6

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 7

Operating activities:

Accepted Answer

A)   Are also called strategic management.
B)   Are the means organizations use to pay for resources like land, buildings and equipment.
C)   Are also called asset management.
D)   Involve acquiring and disposing of resources that a business uses to acquire and sell its products or services.
E)   Involve using resources to research, develop, purchase, produce, distribute and market products and services.F) B) and D)
G) C) and E)

Question 8

The monetary unit assumption means that all companies doing business in the United States must express transactions and events in U.S. dollars.

Accepted Answer

A) True 
 B)False

Question 9

Net Income:

Accepted Answer

A)   Decreases equity.
B)   Represents owners' claims against assets.
C)   Equals assets minus liabilities.
D)   Is the excess of revenues over expenses.
E)   Represents the amount of assets owners put into a business.F) B) and E)
G) C) and E)

Question 10

Increases in equity from a company's sales of products or services are:

Accepted Answer

A)   Revenues.
B)   Owner's Equity.
C)   Assets.
D)   Expenses.
E)   Liabilities.F) A) and C)
G) A) and D)

Question 11

Investing activities are the means an organization uses to pay for resources like land, buildings, and equipment to carry out its plans.

Accepted Answer

A) True 
 B)False

Question 12

The time period assumption:

Accepted Answer

A)   Presumes that the life of a company can be divided into time periods, such as months and years, and that useful reports can be prepared for those periods.
B)   Means that accounting information reflects a presumption that the business will continue operating instead of being closed or sold.
C)   Means that we can express transactions and events in monetary, or money, units.
D)   Means that a business is accounted for separately from other business entities, including its owner.
E)   Prescribes that a company record the expenses it incurred to generate the revenue reported.F) A) and C)
G) D) and E)

Question 13

The difference between a company's assets and its liabilities, or net assets is:

Accepted Answer

A)   Expense.
B)   Net loss.
C)   Equity.
D)   Net income.
E)   Revenue.F) A) and B)
G) B) and D)

Question 14

Regulators often have legal authority over certain activities of organizations.

Accepted Answer

A) True 
 B)False

Question 15

Creditors' claims on assets that reflect company obligations to provide assets, products, or services to others are called ________.

Accepted Answer

The answer of Creditors' claims on assets that reflect company...

Question 16

Recordkeeping, or bookkeeping, is the recording of transactions and events, either manually or electronically. This is just one part of accounting.

Accepted Answer

A) True 
 B)False

Question 17

Billington Corp. borrows $80,000 cash from Second National Bank. How does this transaction affect the accounting equation for Billington?

Accepted Answer

A)   Assets would increase $80,000 and equity would decrease $80,000.
B)   Assets would decrease $80,000 and equity would increase $80,000.
C)   Assets would decrease $80,000 and liabilities would decrease $80,000.
D)   Liabilities would decrease $80,000 and equity would increase $80,000.
E)   Assets would increase $80,000 and liabilities would increase $80,000.F) A) and B)
G) A) and E)

Question 18

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 19

Specific accounting principles are basic assumptions, concepts, and guidelines for preparing financial statements and arise out of long-used accounting practice.

Accepted Answer

A) True 
 B)False

Question 20

A limited partnership:

Accepted Answer

A)   Is subject to double taxation.
B)   Includes a general partner with unlimited liability.
C)   May only have two partners.
D)   Is the same as a corporation.
E)   Has owners called stockholders.F) B) and D)
G) A) and B)

Exam 1: Accounting in Business

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
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Operating activities:

Correct Answer
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Regulators often have legal authority over certain activities of organizations.

Correct Answer
verified

Specific accounting principles are basic assumptions, concepts, and guidelines for preparing financial statements and arise out of long-used accounting practice.

Correct Answer
verified

Match each of the following items with the financial statement in which each item would most likely appear. An item may appear on more than one statement.

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

Correct Answer
verified

Creditors' claims on assets that reflect company obligations to provide assets, products, or services to others are called ________.

Correct Answer
verified

Decreases in equity that represent costs of providing products or services to customers, used to earn revenues are called:

Correct Answer
verified

Increases in equity from a company's sales of products or services are:

Correct Answer
verified

Net Income:

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

Investing activities are the means an organization uses to pay for resources like land, buildings, and equipment to carry out its plans.

Correct Answer
verified

Billington Corp. borrows $80,000 cash from Second National Bank. How does this transaction affect the accounting equation for Billington?

Correct Answer
verified

The monetary unit assumption means that all companies doing business in the United States must express transactions and events in U.S. dollars.

Correct Answer
verified

If the liabilities of a business increased $75,000 during a period of time and the owner's equity in the business decreased $30,000 during the same period, the assets of the business must have:

Correct Answer
verified

A limited partnership:

Correct Answer
verified

Match the following terms with the appropriate definition

The difference between a company's assets and its liabilities, or net assets is:

Correct Answer
verified

Recordkeeping, or bookkeeping, is the recording of transactions and events, either manually or electronically. This is just one part of accounting.

Correct Answer
verified

The time period assumption:

Correct Answer
verified

Exam 1: Accounting in Business

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

Operating activities:

Correct AnswerverifiedShow Answer

Regulators often have legal authority over certain activities of organizations.

Correct AnswerverifiedShow Answer

Specific accounting principles are basic assumptions, concepts, and guidelines for preparing financial statements and arise out of long-used accounting practice.

Correct AnswerverifiedShow Answer

Match each of the following items with the financial statement in which each item would most likely appear. An item may appear on more than one statement.

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

Correct AnswerverifiedShow Answer

Creditors' claims on assets that reflect company obligations to provide assets, products, or services to others are called ________.

Correct AnswerverifiedShow Answer

Decreases in equity that represent costs of providing products or services to customers, used to earn revenues are called:

Correct AnswerverifiedShow Answer

Increases in equity from a company's sales of products or services are:

Correct AnswerverifiedShow Answer

Net Income:

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

Investing activities are the means an organization uses to pay for resources like land, buildings, and equipment to carry out its plans.

Correct AnswerverifiedShow Answer

Billington Corp. borrows $80,000 cash from Second National Bank. How does this transaction affect the accounting equation for Billington?

Correct AnswerverifiedShow Answer

The monetary unit assumption means that all companies doing business in the United States must express transactions and events in U.S. dollars.

Correct AnswerverifiedShow Answer

If the liabilities of a business increased $75,000 during a period of time and the owner's equity in the business decreased $30,000 during the same period, the assets of the business must have:

Correct AnswerverifiedShow Answer

A limited partnership:

Correct AnswerverifiedShow Answer

Match the following terms with the appropriate definition

The difference between a company's assets and its liabilities, or net assets is:

Correct AnswerverifiedShow Answer

Recordkeeping, or bookkeeping, is the recording of transactions and events, either manually or electronically. This is just one part of accounting.

Correct AnswerverifiedShow Answer

The time period assumption:

Correct AnswerverifiedShow Answer

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