Question 1

At the beginning of the year, a company had $120,000 worth of liabilities. During the year, assets increased by $160,000 and at year-end they equaled $360,000. Liabilities decreased $20,000 during the year. Calculate the beginning and ending values of equity.

Accepted Answer

Beginning equity = $...

Question 2

A payment to an owner is called a(n) :

Accepted Answer

A)   Liability.
B)   Withdrawal.
C)   Expense.
D)   Contribution.
E)   Investment.F) None of the above
G) B) and C)

Question 3

Della's Donuts owner made investments of $50,000 and withdrawals of $20,000. The company has revenues of $83,000 and expenses of $64,000. Calculate its net income.

Accepted Answer

A)   $30,000.
B)   $83,000.
C)   $64,000.
D)   $19,000.
E)   $49,000.F) A) and C)
G) A) and E)

Question 4

Bookkeeping is the recording of transactions and events and is only part of accounting.

Accepted Answer

A) True 
 B)False

Question 5

The primary objective of financial accounting is:

Accepted Answer

A)   To serve the decision-making needs of internal users.
B)   To provide financial statements to help external users analyze an organization's activities.
C)   To monitor and control company activities.
D)   To provide information on both the costs and benefits of looking after products and services.
E)   To know what, when, and how much to produce.F) B) and E)
G) C) and D)

Question 6

Accounting is an information and measurement system that does all of the following except:

Accepted Answer

A)   Identifies business activities.
B)   Records business activities.
C)   Communicates business activities.
D)   Does not use technology to improve accuracy in reporting.
E)   Helps people make better decisions.F) A) and D)
G) B) and E)

Question 7

A limited partnership:

Accepted Answer

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

Question 8

What is the balance sheet? What is its purpose?

Accepted Answer

The balance sheet is a listing of the ty...

Question 9

Revenue is properly recognized:

Accepted Answer

A)   When the customer's order is received.
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 and the business obtains the right to collect the sales price.
E)   When cash from a sale is received.F) B) and C)
G) C) and D)

Question 10

Increases in equity from a company's earnings activities are:

Accepted Answer

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

Question 11

The following schedule reflects shows the first month's transactions of the Bill Blue Real Estate Company:
Provide descriptions for each transaction.

Accepted Answer

1. Investment of cash in business by own...

Question 12

External users include lenders, shareholders, customers, and regulators.

Accepted Answer

A) True 
 B)False

Question 13

Investing activities are the acquiring and disposing of resources that an organization uses to acquire and sell its products or services.

Accepted Answer

A) True 
 B)False

Question 14

External auditors examine financial statements to verify that they are prepared according to generally accepted accounting principles.

Accepted Answer

A) True 
 B)False

Question 15

______________________ is the recording of financial transactions and events, either manually or electronically.

Accepted Answer

Recordkeep...

Question 16

The four basic financial statements include the income statement (statement of comprehensive income), statement of changes in equity, balance sheet (statement of financial position), and statement of cash flows.

Accepted Answer

A) True 
 B)False

Question 17

The three common forms of business ownership include sole proprietorship, partnership, and non-profit.

Accepted Answer

A) True 
 B)False

Question 18

Identify the risk and the return in each of the following examples.
a. Investing $500 in a CD at 4.5% interest.
b. Placing a $100 bet on an NBA game.
c. Investing $10,000 in Microsoft shares.
d. Borrowing $20,000 in student loans.

Accepted Answer

a. The risk involved is that the investo...

Question 19

From the information given below, prepare a November income statement, a November statement of changes in equity, and a November 30 balance sheet. On November 1 of the current year, Lois Bell began Lois Bell, Interior Design with an initial investment of $50,000 cash. On November 30 her records showed the following (alphabetically arranged) items and amounts.

Accepted Answer

<img  loading="lazy" src="/assets/images/blured-textbook.svg" class="d-inline m-1" alt="blured image" width="139" height="30"> LOIS BELL, INTERIOR...

Question 20

Owners of a corporation are called shareholders or stockholders.

Accepted Answer

A) True 
 B)False

Exam 1: Accounting in Business

The three common forms of business ownership include sole proprietorship, partnership, and non-profit.

Correct Answer
verified

Bookkeeping is the recording of transactions and events and is only part of accounting.

Correct Answer
verified

______________________ is the recording of financial transactions and events, either manually or electronically.

Correct Answer
verified
Recordkeep...
View Answer

Della's Donuts owner made investments of $50,000 and withdrawals of $20,000. The company has revenues of $83,000 and expenses of $64,000. Calculate its net income.

Correct Answer
verified

A payment to an owner is called a(n) :

Correct Answer
verified

The four basic financial statements include the income statement (statement of comprehensive income), statement of changes in equity, balance sheet (statement of financial position), and statement of cash flows.

Correct Answer
verified

Identify the risk and the return in each of the following examples. a. Investing $500 in a CD at 4.5% interest. b. Placing a $100 bet on an NBA game. c. Investing $10,000 in Microsoft shares. d. Borrowing $20,000 in student loans.

Correct Answer
verified
a. The risk involved is that the investo...
View Answer

Accounting is an information and measurement system that does all of the following except:

Correct Answer
verified

A limited partnership:

Correct Answer
verified

What is the balance sheet? What is its purpose?

Correct Answer
verified
The balance sheet is a listing of the ty...
View Answer

Investing activities are the acquiring and disposing of resources that an organization uses to acquire and sell its products or services.

Correct Answer
verified

Owners of a corporation are called shareholders or stockholders.

Correct Answer
verified

External users include lenders, shareholders, customers, and regulators.

Correct Answer
verified

The following schedule reflects shows the first month's transactions of the Bill Blue Real Estate Company: Provide descriptions for each transaction.

Correct Answer
verified
1. Investment of cash in business by own...
View Answer

Revenue is properly recognized:

Correct Answer
verified

External auditors examine financial statements to verify that they are prepared according to generally accepted accounting principles.

Correct Answer
verified

Increases in equity from a company's earnings activities are:

Correct Answer
verified

Correct Answer
verified
LOIS BELL, INTERIOR...
View Answer

At the beginning of the year, a company had $120,000 worth of liabilities. During the year, assets increased by $160,000 and at year-end they equaled $360,000. Liabilities decreased $20,000 during the year. Calculate the beginning and ending values of equity.

Correct Answer
verified
Beginning equity = $...
View Answer

The primary objective of financial accounting is:

Correct Answer
verified

Exam 1: Accounting in Business

The three common forms of business ownership include sole proprietorship, partnership, and non-profit.

Correct AnswerverifiedShow Answer

Bookkeeping is the recording of transactions and events and is only part of accounting.

Correct AnswerverifiedShow Answer

______________________ is the recording of financial transactions and events, either manually or electronically.

Correct AnswerverifiedRecordkeep...View AnswerShow Answer

Della's Donuts owner made investments of $50,000 and withdrawals of $20,000. The company has revenues of $83,000 and expenses of $64,000. Calculate its net income.

Correct AnswerverifiedShow Answer

A payment to an owner is called a(n) :

Correct AnswerverifiedShow Answer

The four basic financial statements include the income statement (statement of comprehensive income), statement of changes in equity, balance sheet (statement of financial position), and statement of cash flows.

Correct AnswerverifiedShow Answer

Identify the risk and the return in each of the following examples. a. Investing $500 in a CD at 4.5% interest. b. Placing a $100 bet on an NBA game. c. Investing $10,000 in Microsoft shares. d. Borrowing $20,000 in student loans.

Correct Answerverifieda. The risk involved is that the investo...View AnswerShow Answer

Accounting is an information and measurement system that does all of the following except:

Correct AnswerverifiedShow Answer

A limited partnership:

Correct AnswerverifiedShow Answer

What is the balance sheet? What is its purpose?

Correct AnswerverifiedThe balance sheet is a listing of the ty...View AnswerShow Answer

Investing activities are the acquiring and disposing of resources that an organization uses to acquire and sell its products or services.

Correct AnswerverifiedShow Answer

Owners of a corporation are called shareholders or stockholders.

Correct AnswerverifiedShow Answer

External users include lenders, shareholders, customers, and regulators.

Correct AnswerverifiedShow Answer

The following schedule reflects shows the first month's transactions of the Bill Blue Real Estate Company: Provide descriptions for each transaction.

Correct Answerverified1. Investment of cash in business by own...View AnswerShow Answer

Revenue is properly recognized:

Correct AnswerverifiedShow Answer

External auditors examine financial statements to verify that they are prepared according to generally accepted accounting principles.

Correct AnswerverifiedShow Answer

Increases in equity from a company's earnings activities are:

Correct AnswerverifiedShow Answer

Correct Answerverified LOIS BELL, INTERIOR...View AnswerShow Answer

At the beginning of the year, a company had $120,000 worth of liabilities. During the year, assets increased by $160,000 and at year-end they equaled $360,000. Liabilities decreased $20,000 during the year. Calculate the beginning and ending values of equity.

Correct AnswerverifiedBeginning equity = $...View AnswerShow Answer

The primary objective of financial accounting is:

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
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Correct Answer
verified
Recordkeep...
View Answer

Correct Answer
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Correct Answer
verified

Correct Answer
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Correct Answer
verified
a. The risk involved is that the investo...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The balance sheet is a listing of the ty...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
1. Investment of cash in business by own...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
LOIS BELL, INTERIOR...
View Answer

Correct Answer
verified
Beginning equity = $...
View Answer

Correct Answer
verified