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Match the business activity to the appropriate category. -The purchase of advertising time by the company


A) Financing activity
B) Operating activity
C) Investing activity

D) None of the above
E) All of the above

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A company's balance sheet contained the following information:  Common Stock $24,000 Total Assets $352,000 Accounts Payable 128,000 Retained Earnings 56,000\begin{array}{lrrr}\text { Common Stock } & \$ 24,000 & \text { Total Assets } & \$ 352,000 \\\text { Accounts Payable } & 128,000 & \text { Retained Earnings } & 56,000\end{array} Notes Payable is the only other item on the balance sheet.Notes Payable must equal:


A) $400,000.
B) $16,000.
C) $144,000.
D) $688,000.

E) A) and C)
F) C) and D)

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As of September 30,Year 3,who provided more financing for Anonymous,Inc.? A) Owners B) Creditors C) Both provided equal financing D) Neither provided any financing As of September 30,Year 3,who provided more financing for Anonymous,Inc.?


A) Owners
B) Creditors
C) Both provided equal financing
D) Neither provided any financing

E) A) and B)
F) A) and D)

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Faithful representation is a characteristic of external financial reporting that means:


A) the financial reports of a business are assumed to include the results of only that business's activities.
B) financial information can be compared across businesses because similar accounting methods are applied.
C) the results of business activities are reported using an appropriate monetary unit.
D) financial information depicts the economic substance of business activities.

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

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Which of the following statements about the use of financial statements is not correct?


A) When choosing between a company that pays steady dividends and one that retains its earnings to support future growth,investors will always choose the company that pays steady dividends.
B) Companies can develop reputations for honest financial reporting even when conveying bad news.
C) Trends in a company's net income from year to year can provide clues about its future earnings,which can help investors to decide whether to buy stock in the company.
D) Information in the notes to the financial statements can influence a user's interpretation of balance sheet and income statement information.

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

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If Blair Industries had $24 million in revenue and net income of $6 million,then its:


A) expenses must have been $30 million.
B) expenses must have been $18 million.
C) assets must have been $24 million.
D) assets must have been $6 million.

E) A) and D)
F) A) and C)

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A company's financial records at the end of the year included the following amounts:  Cash $70,000 Accounts Receivable 28,000 Supplies 4,000 Accounts Payable 10,000 Notes Payable 5,000 Retained Earnings, beginning of year 17,000 Common Stock 40,000 Service Revenue 53,000 Wages Expense 8,000 Advertising Expense 5,000 Rent Expense 10,000\begin{array}{lr}\text { Cash } & \$ 70,000 \\\text { Accounts Receivable } & 28,000 \\\text { Supplies } & 4,000 \\\text { Accounts Payable } & 10,000 \\\text { Notes Payable } & 5,000 \\\text { Retained Earnings, beginning of year } & 17,000 \\\text { Common Stock } & 40,000 \\\text { Service Revenue } & 53,000 \\\text { Wages Expense } & 8,000 \\\text { Advertising Expense } & 5,000 \\\text { Rent Expense } & 10,000\end{array} What is the amount of total assets to be reported on the balance sheet at the end of the year?


A) $112,000
B) $102,000
C) $119,000
D) $155,000

E) B) and D)
F) A) and B)

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Puffin Co.began the year with assets of $120,000 and liabilities of $90,000.During the year assets increased by $14,400 and liabilities decreased by $10,800. What is the amount of the change in Puffin's stockholders' equity during the year?


A) $3,600 increase
B) $25,200 increase
C) $25,200 decrease
D) $3,600 decrease

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

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Which transaction would be reported on the income statement for the current year?


A) The revenue earned from selling sold goods in the current year to customers who have not yet paid for those goods (that is,they have promised to pay for those goods next year) .
B) The amount of cash received from customers this year as payment for goods that were sold to those customers last year.
C) The proceeds from a borrowing from the bank that was to be used to finance business activities during the current year.
D) The proceeds from the issuance of common stock to owners that was to be used to finance business activities during the current year.

E) A) and D)
F) A) and C)

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Net income appears on which of the following financial statements?


A) Balance sheet and income statement
B) Balance sheet and statement of retained earnings
C) Balance sheet and statement of cash flows
D) Income statement and statement of retained earnings

E) A) and D)
F) B) and D)

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Which of the following statements about the format of financial statements is correct?


A) A double underline is drawn below the subtotal for Total Liabilities on the balance sheet.
B) Dollar signs are omitted if the heading states that amounts are reported in U.S.dollars.
C) Dividends are shown in parentheses on the statement of retained earnings.
D) The order of the items included in the heading of each financial statement is as follows: the name of the business,the time period covered by the financial statement,and the title of the report.

E) B) and C)
F) B) and D)

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The Statement of Cash Flows for the current year contained the following: The Statement of Cash Flows for the current year contained the following: The change in cash for the current year was an increase of $14,000. What is the amount of cash flows from (used in) financing activities? A) ($40,000) B) $5,000 C) $49,000 D) $10,000 The change in cash for the current year was an increase of $14,000. What is the amount of cash flows from (used in) financing activities?


A) ($40,000)
B) $5,000
C) $49,000
D) $10,000

E) B) and D)
F) B) and C)

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A company began the year with assets of $200,000,liabilities of $40,000,and stockholders' equity of $160,000.During the year assets increased $110,000 and stockholders' equity increased $40,000.What was the change in liabilities for the year?


A) Increase of $150,000
B) Increase of $70,000
C) Decrease of $150,000
D) Decrease of $70,000

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

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Match the term to the appropriate definition.(There are more definitions than terms. ) -Investors


A) A procedure by which independent evaluators assess the accounting procedures and financial reports of a company.
B) An example of external users of financial statements.
C) Activities directly related to running the business to earn a profit.
D) When a company acquires money from investors.
E) A financial statement that summarizes a company's past and current cash situation.
F) Transactions with lenders (borrowing and repaying cash) and stockholders (selling company stock and paying dividends) .
G) The total amount of profits that are kept by the company.
H) The idea that the financial statements of a company include the results of only that company's business activities.
I) The idea that a company should report its financial data in the relevant currency.
J) Borrowing money from lenders.
K) A financial statement showing a company's assets,liabilities and stockholders' equity.
L) A financial statement that shows a company's revenues and expenses.
M) An example of an internal user of financial statements.

N) G) and H)
O) F) and L)

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The following partially completed balance sheet is missing numerical data. The following partially completed balance sheet is missing numerical data. Required: Fill in the missing items in the balance sheet. Required: Fill in the missing items in the balance sheet.

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In the U.S. ,public companies have to be audited by independent auditors using rules approved by the:


A) International Accounting Standards Board (IASB) .
B) Public Company Accounting Oversight Board (PCAOB) .
C) Financial Accounting Standards Board (FASB) .
D) American Institute of Certified Public Accountants (AICPA) .

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

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Crystal Lodging recorded $330,000 in revenues,$247,500 in expenses,and $45,000 of dividends for the year.The company began the year with total assets of $285,000 and stockholder's equity of $130,500. Suppose that liabilities increased by $90,000 and stockholders' equity increased by $37,500.What would be the change in Crystal Lodging's assets?


A) $168,000 increase
B) $127,500 increase
C) $154,500 increase
D) $52,500 increase

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

Correct Answer

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Cash activity with stockholders and creditors,such as banks,are reported as cash flows from ________ activities on the statement of cash flows.


A) financing
B) investing
C) operating
D) managing

E) None of the above
F) All of the above

Correct Answer

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A cost of doing business is referred to as a(n) ________ and is considered necessary to earn ________.


A) revenue;assets
B) expense;revenue
C) liability;expenses
D) dividend;revenue

E) C) and D)
F) A) and C)

Correct Answer

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In a sense,________ is to accountants and auditors what the criminal code is to lawyers and the public.


A) the SEC
B) faithful representation
C) U.S.GAAP
D) the basic accounting equation

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

Correct Answer

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Showing 41 - 60 of 228

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