Total Assets: cash, equipment, building, land, accounts receivable
Total Liabilities: notes payable, accounts payable
Total Owner’s Equity: capital stock, retained earnings
Exam Week 1
1. Internal users of financial
...
Total Assets: cash, equipment, building, land, accounts receivable
Total Liabilities: notes payable, accounts payable
Total Owner’s Equity: capital stock, retained earnings
Exam Week 1
1. Internal users of financial accounting information include all of the following except:
Investors
2. The work of accountants practicing in public accounting may best be described as:
Providing various types of accounting services to a wide variety of clients
3. Financial statements may be prepared for which time period?
Any time period
4. The accounting standards and concepts used in the preparation of financial statements
are called:
Generally accepted accounting principles (GAAP)
5. Overseeing a company's affairs to ensure that the company is managed with the best
interest of shareholders in mind is called:
Corporate Governance
6. During the month of May, Henderson Company had the following transactions:
(1) Revenues of $60,000 were earned and received in cash.
(2) Bank loans of $9,000 were paid off.
(3) Equipment of $20,000 was purchased.
(4) Expenses of $36,800 were paid.
(5) Stockholders purchased additional shares for $22,000 cash.
A statement of cash flows for May would report net cash flows from operating activities of:
$23,200 (Net Cash Flow=Revenues- Expenses: 60,000-36,800)
Henderson Company
Income Statement
For the month of May
Revenues $60,000
Expenses $36,800
Net Cash Flow (Net income) $23,200
7. Each year, the accountant for Southern Real Estate Company adjusts the recorded value
of each asset to its market value. Using these market value figures on the balance sheet
violates:
The cost principle
8. If $9,600 cash and a $31,000 note payable are given in exchange for some office
machines to be used in a business:
Total assets are increased
9. Which of the following activities is not a category into which cash flows are classified?
Marketing Activities
10. From an accounting viewpoint, when is a business considered as an entity separate from
its owner(s)?
A business is always considered as an accounting entity separate from the
activities of the owner(s)
11. Which of the following describes the proper form of a balance sheet?
Liabilities are listed before owners’ equity
12. Thirty percent of the total assets of Shanahan Corporation have been financed through
borrowing. The total liabilities of the company are $600,000. What is the amount of
owners' equity?
$1,400,000 (30% of Assets = $600,000 Therefore, Assets = $2,000,000; Owners’
Equity = Total Assets − Total Liabilities: 2,000,000-600,000)
13. If during the
[Show More]
.png)
.png)
.png)
