Question 1

What is the major difference between the objective of financial accounting and the objective of managerial accounting?

Accepted Answer

The objective of financial acc...

Question 2

If total assets increased by $190,000 during a specific period and liabilities decreased by $10,000 during the same period,the period's change in total stockholders' equity was a $200,000 increase.

Accepted Answer

A) True 
 B)False

Question 3

Which of the following is not an asset?

Accepted Answer

A)  investments
B)  cash
C)  inventory
D)  stockholders' equityE) None of the above
F) B) and C)

Question 4

The accountant for Scott Industries prepared the following list of account balances from the company’s records for the year ended December 31:

-Determine the total liabilities at the end of the current year for Scott Industries.

Accepted Answer

$37,000
$12,000 Acc...

Question 5

Company G has a ratio of liabilities to stockholders' equity of 0.12 and 0.28 for Year 1 and Year 2,respectively.In contrast,Company M has a ratio of liabilities to stockholders' equity of 1.13 and 1.29 for the same period.
REQUIRED:
Based on this information,which company's creditors are more at risk and why? Should the creditors of either company fear the risk of nonpayment?

Accepted Answer

Company M's creditors are more at risk t...

Question 6

Select the type of business that is most likely to obtain large amounts of resources by issuing stock.

Accepted Answer

A)  partnership
B)  corporation
C)  proprietorship
D)  government entityE) B) and C)
F) A) and B)

Question 7

The unit of measure concept

Accepted Answer

A)  is only used in the financial statements of manufacturing companies
B)  is not important when applying the cost concept
C)  requires that different units be used for assets and liabilities
D)  requires that economic data be reported in yen in Japan or dollars in the United StatesE) A) and B)
F) A) and C)

Question 8

The assets section of the balance sheet normally presents assets in

Accepted Answer

A)  alphabetical order
B)  the order of largest to smallest dollar amounts
C)  the order in which they will be converted into cash or used in operations
D)  the order of smallest to largest dollar amountsE) B) and C)
F) B) and D)

Question 9

Explain the interrelationship between the balance sheet and the statement of cash flows.

Accepted Answer

The cash reported on the balan...

Question 10

Goods purchased on account for future use in the business,such as supplies,are called

Accepted Answer

A)  prepaid liabilities
B)  revenues
C)  prepaid expenses
D)  liabilitiesE) A) and C)
F) A) and D)

Question 11

Transactions affecting stockholders' equity include

Accepted Answer

A)  capital contributions and payment of liabilities
B)  capital contributions,stockholder dividends,earning of revenues,and incurrence of expenses
C)  capital contributions,earning of revenues,incurrence of expenses,and collection of accounts receivable
D)  stockholder dividends,earning of revenues,incurrence of expenses,and purchase of supplies on accountE) A) and D)
F) All of the above

Question 12

The stockholders' rights to the assets rank ahead of the creditors' rights to the assets.

Accepted Answer

A) True 
 B)False

Question 13

Discuss the characteristics of a limited liability company LLC.

Accepted Answer

A limited liability company LLC combines...

Question 14

Proper ethical conduct implies that you only consider what's in your best interest.

Accepted Answer

A) True 
 B)False

Question 15

A corporation is a business that is legally separate and distinct from its owners.

Accepted Answer

A) True 
 B)False

Question 16

Which of the following best describes accounting?

Accepted Answer

A)  records economic data but does not communicate the data to users according to any specific rules
B)  is an information system that provides reports to users regarding economic activities and condition of a business
C)  is of no use by individuals outside of the business
D)  is used only for filling out tax returns and for financial statements for various type of governmental reporting requirementsE) C) and D)
F) B) and D)

Question 17

Which of the following concepts relates to separating the reporting of business and personal economic transactions?

Accepted Answer

A)  cost concept
B)  unit of measure concept
C)  business entity concept
D)  objectivity conceptE) All of the above
F) A) and D)

Question 18

Receiving a bill or otherwise being notified that an amount is owed is not recorded until the amount is paid.

Accepted Answer

A) True 
 B)False

Question 19

The cost concept is the basis for entering the purchase price into the accounting records.

Accepted Answer

A) True 
 B)False

Question 20

Companies like Enron,WorldCom,and Tyco International,Ltd.have been caught in the midst of ethical lapses that led to fines,firings,and criminal and/or civil prosecution.List and briefly describe three factors that are responsible for what went wrong in these companies.

Accepted Answer

The three factors are: 1 individual char...

Exam 1: Introduction to Accounting and Business

If total assets increased by $190,000 during a specific period and liabilities decreased by $10,000 during the same period,the period's change in total stockholders' equity was a $200,000 increase.

Correct Answer
verified

Correct Answer
verified
Company M's creditors are more at risk t...
View Answer

Receiving a bill or otherwise being notified that an amount is owed is not recorded until the amount is paid.

Correct Answer
verified

What is the major difference between the objective of financial accounting and the objective of managerial accounting?

Correct Answer
verified
The objective of financial acc...
View Answer

Which of the following concepts relates to separating the reporting of business and personal economic transactions?

Correct Answer
verified

The cost concept is the basis for entering the purchase price into the accounting records.

Correct Answer
verified

Select the type of business that is most likely to obtain large amounts of resources by issuing stock.

Correct Answer
verified

Transactions affecting stockholders' equity include

Correct Answer
verified

Goods purchased on account for future use in the business,such as supplies,are called

Correct Answer
verified

The accountant for Scott Industries prepared the following list of account balances from the company’s records for the year ended December 31: -Determine the total liabilities at the end of the current year for Scott Industries.

Correct Answer
verified
$37,000
$12,000 Acc...
View Answer

Proper ethical conduct implies that you only consider what's in your best interest.

Correct Answer
verified

Which of the following best describes accounting?

Correct Answer
verified

Companies like Enron,WorldCom,and Tyco International,Ltd.have been caught in the midst of ethical lapses that led to fines,firings,and criminal and/or civil prosecution.List and briefly describe three factors that are responsible for what went wrong in these companies.

Correct Answer
verified
The three factors are: 1 individual char...
View Answer

The stockholders' rights to the assets rank ahead of the creditors' rights to the assets.

Correct Answer
verified

A corporation is a business that is legally separate and distinct from its owners.

Correct Answer
verified

Explain the interrelationship between the balance sheet and the statement of cash flows.

Correct Answer
verified
The cash reported on the balan...
View Answer

Discuss the characteristics of a limited liability company LLC.

Correct Answer
verified
A limited liability company LLC combines...
View Answer

Which of the following is not an asset?

Correct Answer
verified

The unit of measure concept

Correct Answer
verified

The assets section of the balance sheet normally presents assets in

Correct Answer
verified

Exam 1: Introduction to Accounting and Business

If total assets increased by $190,000 during a specific period and liabilities decreased by $10,000 during the same period,the period's change in total stockholders' equity was a $200,000 increase.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedCompany M's creditors are more at risk t...View AnswerShow Answer

Receiving a bill or otherwise being notified that an amount is owed is not recorded until the amount is paid.

Correct AnswerverifiedShow Answer

What is the major difference between the objective of financial accounting and the objective of managerial accounting?

Correct AnswerverifiedThe objective of financial acc...View AnswerShow Answer

Which of the following concepts relates to separating the reporting of business and personal economic transactions?

Correct AnswerverifiedShow Answer

The cost concept is the basis for entering the purchase price into the accounting records.

Correct AnswerverifiedShow Answer

Select the type of business that is most likely to obtain large amounts of resources by issuing stock.

Correct AnswerverifiedShow Answer

Transactions affecting stockholders' equity include

Correct AnswerverifiedShow Answer

Goods purchased on account for future use in the business,such as supplies,are called

Correct AnswerverifiedShow Answer

The accountant for Scott Industries prepared the following list of account balances from the company’s records for the year ended December 31: -Determine the total liabilities at the end of the current year for Scott Industries.

Correct Answerverified$37,000 $12,000 Acc...View AnswerShow Answer

Proper ethical conduct implies that you only consider what's in your best interest.

Correct AnswerverifiedShow Answer

Which of the following best describes accounting?

Correct AnswerverifiedShow Answer

Companies like Enron,WorldCom,and Tyco International,Ltd.have been caught in the midst of ethical lapses that led to fines,firings,and criminal and/or civil prosecution.List and briefly describe three factors that are responsible for what went wrong in these companies.

Correct AnswerverifiedThe three factors are: 1 individual char...View AnswerShow Answer

The stockholders' rights to the assets rank ahead of the creditors' rights to the assets.

Correct AnswerverifiedShow Answer

A corporation is a business that is legally separate and distinct from its owners.

Correct AnswerverifiedShow Answer

Explain the interrelationship between the balance sheet and the statement of cash flows.

Correct AnswerverifiedThe cash reported on the balan...View AnswerShow Answer

Discuss the characteristics of a limited liability company LLC.

Correct AnswerverifiedA limited liability company LLC combines...View AnswerShow Answer

Which of the following is not an asset?

Correct AnswerverifiedShow Answer

The unit of measure concept

Correct AnswerverifiedShow Answer

The assets section of the balance sheet normally presents assets in

Correct AnswerverifiedShow Answer

Correct Answer
verified

Correct Answer
verified
Company M's creditors are more at risk t...
View Answer

Correct Answer
verified

Correct Answer
verified
The objective of financial acc...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
$37,000
$12,000 Acc...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The three factors are: 1 individual char...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified
The cash reported on the balan...
View Answer

Correct Answer
verified
A limited liability company LLC combines...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified