Question 1

A limited liability company offers the limited liability of a partnership or proprietorship and the tax treatment of a corporation.

Accepted Answer

A) True 
 B)False

Question 2

Cornelia's Closet has the following account balances for the dates given:
October 1 October 31
Cash $40,000 60,000
Accounts Receivable 40,000 38,000
Accounts payable 6,000 ?
Also,its net income,for October 1 through October 31 was $20,000 and there were no dividends or stock issuances.Determine the equity at both October 1 and October 31.

Accepted Answer

October 1^st Equity = $...

Question 3

Resources a company owns or controls that are expected to yield future benefits are:

Accepted Answer

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

Question 4

The full disclosure principle:

Accepted Answer

A)  Prescribes that accounting information is based on actual cost.
B)  Provides guidance on when a company must recognize revenue.
C)  Prescribes that a company report the details behind financial statements that would impact users' decisions.
D)  Prescribes that a company record the expenses it incurred to generate the revenue reported.
E)  Means that accounting information reflects a presumption that the business will continue operating instead of being closed or sold.F) A) and C)
G) A) and D)

Question 5

The accounting equation is ________.

Accepted Answer

Assets = L...

Question 6

________ is net income divided by average total assets.

Accepted Answer

The answer of ________ is net income divided by average...

Question 7

Jet Styling has the following beginning cash balance and cash transactions for the month of January.Using this information prepare a statement of cash flows.

Accepted Answer

The answer of Jet Styling has the following beginning cash...

Question 8

Marsha Bogswell is the sole stockholder of Bogswell Legal Services.Which accounting principle requires Marsha to keep her personal financial information separate from the financial information of Bogswell Legal Services?

Accepted Answer

A)  Monetary unit assumption.
B)  Going-concern assumption.
C)  Measurement (Cost) principle.
D)  Business entity assumption.
E)  Expense recognition (Matching) principle.F) C) and D)
G) B) and D)

Question 9

Revenue is properly recognized:

Accepted Answer

A)  When the customer makes an order.
B)  Only if the transaction creates an account receivable.
C)  At the end of the accounting period.
D)  Upon completion of the sale or when services have been performed.
E)  When cash from a sale is received.F) A) and B)
G) C) and D)

Question 10

Return on assets (ROA)is useful in evaluating management,analyzing and forecasting profits,and planning activities.

Accepted Answer

A) True 
 B)False

Question 11

The accounting concept that requires financial statement information to be supported by independent,unbiased evidence is:

Accepted Answer

A)  Business entity assumption.
B)  Revenue recognition principle.
C)  Going-concern assumption.
D)  Time-period assumption.
E)  Objectivity principleF) A) and E)
G) C) and E)

Question 12

Determine the net income of a company for which the following information is available for the month of July.

Accepted Answer

A)  $190,000.
B)  $210,000.
C)  $230,000.
D)  $400,000.
E)  $610,000.F) None of the above
G) A) and E)

Question 13

Generally,the lower the risk,the higher the return that can be expected.

Accepted Answer

A) True 
 B)False

Question 14

U.S.Government Treasury bonds provide low return and low risk to investors.

Accepted Answer

A) True 
 B)False

Question 15

In accounting,the rule that requires that assets,services,and liabilities be recorded initially at the cash or cash-equivalent value of what was given up or of the item received is called the ________.

Accepted Answer

Measuremen...

Question 16

Risk is the uncertainty about the return we will earn.

Accepted Answer

A) True 
 B)False

Question 17

The balance sheet is based on the accounting equation.

Accepted Answer

A) True 
 B)False

Question 18

A partnership:

Accepted Answer

A)  Is also called a sole proprietorship.
B)  Has unlimited liability for its partners.
C)  Is legally required to have a written agreement.
D)  Is a legal organization separate from its owners.
E)  Has owners called shareholders.F) A) and E)
G) C) and E)

Question 19

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

Accepted Answer

A)  Net losses.
B)  Expenses.
C)  Revenues.
D)  Equity.
E)  Liabilities.F) B) and C)
G) C) and E)

Question 20

An exchange of value between two entities that yields a change in the accounting equation is called:

Accepted Answer

A)  The accounting equation.
B)  Recordkeeping or bookkeeping.
C)  An external transaction.
D)  An asset.
E)  Net Income.F) A) and E)
G) A) and C)

Exam 1: Introducing Financial Statements

Risk is the uncertainty about the return we will earn.

Correct Answer
verified

Revenue is properly recognized:

Correct Answer
verified

________ is net income divided by average total assets.

Correct Answer
verified

A limited liability company offers the limited liability of a partnership or proprietorship and the tax treatment of a corporation.

Correct Answer
verified

Return on assets (ROA)is useful in evaluating management,analyzing and forecasting profits,and planning activities.

Correct Answer
verified

Resources a company owns or controls that are expected to yield future benefits are:

Correct Answer
verified

A partnership:

Correct Answer
verified

The accounting concept that requires financial statement information to be supported by independent,unbiased evidence is:

Correct Answer
verified

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

Correct Answer
verified

Jet Styling has the following beginning cash balance and cash transactions for the month of January.Using this information prepare a statement of cash flows.

Correct Answer
verified

U.S.Government Treasury bonds provide low return and low risk to investors.

Correct Answer
verified

The balance sheet is based on the accounting equation.

Correct Answer
verified

The full disclosure principle:

Correct Answer
verified

An exchange of value between two entities that yields a change in the accounting equation is called:

Correct Answer
verified

Generally,the lower the risk,the higher the return that can be expected.

Correct Answer
verified

Determine the net income of a company for which the following information is available for the month of July.

Correct Answer
verified

Correct Answer
verified
October 1^st Equity = $...
View Answer

The accounting equation is ________.

Correct Answer
verified
Assets = L...
View Answer

In accounting,the rule that requires that assets,services,and liabilities be recorded initially at the cash or cash-equivalent value of what was given up or of the item received is called the ________.

Correct Answer
verified
Measuremen...
View Answer

Marsha Bogswell is the sole stockholder of Bogswell Legal Services.Which accounting principle requires Marsha to keep her personal financial information separate from the financial information of Bogswell Legal Services?

Correct Answer
verified

Exam 1: Introducing Financial Statements

Risk is the uncertainty about the return we will earn.

Correct AnswerverifiedShow Answer

Revenue is properly recognized:

Correct AnswerverifiedShow Answer

________ is net income divided by average total assets.

Correct AnswerverifiedShow Answer

A limited liability company offers the limited liability of a partnership or proprietorship and the tax treatment of a corporation.

Correct AnswerverifiedShow Answer

Return on assets (ROA)is useful in evaluating management,analyzing and forecasting profits,and planning activities.

Correct AnswerverifiedShow Answer

Resources a company owns or controls that are expected to yield future benefits are:

Correct AnswerverifiedShow Answer

A partnership:

Correct AnswerverifiedShow Answer

The accounting concept that requires financial statement information to be supported by independent,unbiased evidence is:

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Jet Styling has the following beginning cash balance and cash transactions for the month of January.Using this information prepare a statement of cash flows.

Correct AnswerverifiedShow Answer

U.S.Government Treasury bonds provide low return and low risk to investors.

Correct AnswerverifiedShow Answer

The balance sheet is based on the accounting equation.

Correct AnswerverifiedShow Answer

The full disclosure principle:

Correct AnswerverifiedShow Answer

An exchange of value between two entities that yields a change in the accounting equation is called:

Correct AnswerverifiedShow Answer

Generally,the lower the risk,the higher the return that can be expected.

Correct AnswerverifiedShow Answer

Determine the net income of a company for which the following information is available for the month of July.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedOctober 1st Equity = $...View AnswerShow Answer

The accounting equation is ________.

Correct AnswerverifiedAssets = L...View AnswerShow Answer

In accounting,the rule that requires that assets,services,and liabilities be recorded initially at the cash or cash-equivalent value of what was given up or of the item received is called the ________.

Correct AnswerverifiedMeasuremen...View AnswerShow Answer

Marsha Bogswell is the sole stockholder of Bogswell Legal Services.Which accounting principle requires Marsha to keep her personal financial information separate from the financial information of Bogswell Legal Services?

Correct AnswerverifiedShow Answer

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October 1^st Equity = $...
View Answer

Correct Answer
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Assets = L...
View Answer

Correct Answer
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Measuremen...
View Answer

Correct Answer
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