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________ is an information and measurement system that identifies,records and communicates relevant,reliable and comparable information about an organization's economic activities.

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A balance sheet covers activities over a period of time such as a month or year.

A) True
B) False

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A common characteristic of ________ is their ability to yield expected future benefits to a business.

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Identify several opportunities in accounting and distinguish between private accounting and public accounting.

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The four broad areas of accounting are f...

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Prepare a December 31 balance sheet in proper form for Cane Property Management using the following accounts and amounts: Prepare a December 31 balance sheet in proper form for Cane Property Management using the following accounts and amounts:

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A sole proprietorship is a business with multiple owners.

A) True
B) False

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Owner financing refers to resources contributed by creditors or lenders.

A) True
B) False

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Verity Siding Company,owned by S.Verity,its sole stockholder,began operations in May and completed the following transactions during that first month of operations.Show the effects of the transactions on the accounts of the accounting equation by recording increases and decreases in the appropriate columns in the table below.Do not determine new account balances after each transaction.Determine the final total for each account and verify that the equation is in balance. Verity Siding Company,owned by S.Verity,its sole stockholder,began operations in May and completed the following transactions during that first month of operations.Show the effects of the transactions on the accounts of the accounting equation by recording increases and decreases in the appropriate columns in the table below.Do not determine new account balances after each transaction.Determine the final total for each account and verify that the equation is in balance. Verity Siding Company,owned by S.Verity,its sole stockholder,began operations in May and completed the following transactions during that first month of operations.Show the effects of the transactions on the accounts of the accounting equation by recording increases and decreases in the appropriate columns in the table below.Do not determine new account balances after each transaction.Determine the final total for each account and verify that the equation is in balance.

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Which of the following accounts is not included in the calculation of net income?


A) Services revenue.
B) Wages expense.
C) Rent expense.
D) Cash.
E) Rent revenue.

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

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Alpha Company has assets of $600,000,liabilities of $250,000,and equity of $350,000.It buys office equipment on credit for $75,000.What would be the effects of this transaction on the accounting equation?


A) Assets increase by $75,000 and expenses increase by $75,000.
B) Assets increase by $75,000 and expenses decrease by $75,000.
C) Liabilities increase by $75,000 and expenses decrease by $75,000.
D) Assets decrease by $75,000 and expenses decrease by $75,000.
E) Assets increase by $75,000 and liabilities increase by $75,000.

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

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If the assets of a business increased $89,000 during a period of time and its liabilities increased $67,000 during the same period,equity in the business must have:


A) Increased $22,000.
B) Decreased $22,000.
C) Increased $89,000.
D) Decreased $156,000.
E) Increased $156,000.

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

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The statement of cash flows identifies cash flows separated into operating,investing,and financing activities over a period of time.

A) True
B) False

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Risk is:


A) Net income divided by average total assets.
B) The reward for investment.
C) The uncertainty about the return we will earn.
D) Unrelated to return expected.
E) Derived from the idea of getting something back from an investment.

F) C) and D)
G) A) and C)

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

A) True
B) False

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Arrow's net income of $120 million and average total assets of $1,500 million results in a return on assets of 8%.

A) True
B) False

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Determine the net income of a company for which the following information is available for the month of September. Determine the net income of a company for which the following information is available for the month of September. A) $263,800. B) $432,200. C) $171,000. D) $167,800. E) $252,000.


A) $263,800.
B) $432,200.
C) $171,000.
D) $167,800.
E) $252,000.

F) A) and E)
G) A) and D)

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The going concern assumption:


A) Means that accounting information reflects a presumption that the business will continue operating instead of being closed or sold.
B) Means that we can express transactions and events in monetary,or money,units.
C) Presumes that the life of a company can be divided into time periods,such as months and years,and that useful reports can be prepared for those periods.
D) Means that a business is accounted for separately from other business entities,including its owner.
E) Prescribes that a company record the expenses it incurred to generate the revenue reported.

F) B) and E)
G) A) and B)

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________ explains changes in the stockholders' claim on the business's assets from net income or loss and dividends over a period of time.

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The statem...

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Match the following terms with the appropriate definition.

Premises
Persons using accounting information who are directly involved in managing and operating the organization.
An information and measurement system that identifies,records and communicates relevant reliable and comparable information about an organization's business activities.
The part of accounting that involves recording transactions and events,either electronically or manually.
Persons using accounting information who are not directly involved in running the organization.
A model that asserts the factors that must exist for a person to commit fraud.
Beliefs that distinguish right from wrong,considered accepted standards of good and bad behavior.
Accounting specialists that have met educational and experience requirements,passed an examination and exhibit ethical characteristics to achieve a professional certification.
The area of accounting aimed at serving external users by providing them with general-purpose financial statements.
The area of accounting that serves the decision-making needs of internal users.
Responses
Certified Public Accountant (CPA)
Recordkeeping
Managerial accounting
External users
Fraud triangle
Ethics
Accounting
Internal users
Financial accounting

Correct Answer

Persons using accounting information who are directly involved in managing and operating the organization.
An information and measurement system that identifies,records and communicates relevant reliable and comparable information about an organization's business activities.
The part of accounting that involves recording transactions and events,either electronically or manually.
Persons using accounting information who are not directly involved in running the organization.
A model that asserts the factors that must exist for a person to commit fraud.
Beliefs that distinguish right from wrong,considered accepted standards of good and bad behavior.
Accounting specialists that have met educational and experience requirements,passed an examination and exhibit ethical characteristics to achieve a professional certification.
The area of accounting aimed at serving external users by providing them with general-purpose financial statements.
The area of accounting that serves the decision-making needs of internal users.

Objectives,qualitative characteristics,elements,and recognition and measurement are components of the FASB conceptual framework.

A) True
B) False

Correct Answer

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