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Exam 1: Introducing Accounting in Business

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Question 111

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The difference between a company's assets and its liabilities or its net assets is:

A) Net income
B) Expense
C) Equity
D) Revenue
E) Net loss

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Question 112

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A company purchased $7,000 of supplies and testing equipment on credit.Enter the appropriate amounts that reflect this transaction into the accounting equation format shown below. $\begin{array} { | c | c | c | } \hline \text { Assets } = & \text { Liabilities } + & \text { Equity } \\\hline & & \\\hline\end{array}$

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\[\begin{array} { | c | c | c ...

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Question 113

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Explain why ethics are an integral part of accounting?

A parcel of land is: offered for sale at $150,000,assessed for tax purposes at $95,000,recognized by its purchasers as being worth $140,000 and purchased for $137,000.The land should be recorded in the purchaser's books at:

A net loss arises when revenues exceed expenses.

Identify the two main groups involved in establishing generally accepted accounting principles in the U.S.

Recording the items on the financial statements in dollars is:

Assets are the resources owned or controlled by a business.

Identify and describe the three major activities of a business organization.

______________________ are procedures set up to protect company property and equipment,ensure reliable accounting reports,promote efficiency and encourage adherence to company policies.

Match the following definitions with terms 1 through 8.Place the letter that identifies the best definition in the blank space next to the term.

Planning activities:

Beginning Assets were $700,000,Beginning Equity was $225,000,Revenue for the year was $523,000,Common Stock sold during the year totaled $320,000,Expenses for the year were $392,000,Ending Equity is $751,000,and Ending Assets are $963,000. What is Net Income for the year?

What distinguishes liabilities from equity?

The amounts reported in the accounts for assets used in operations are based on their costs.This practice is best justified by the:

__________________________ is the recording of transactions or events and is just one part of accounting.

If Madiera Company paid $42,000 of its accounts payable in cash,what would be the effect of this transaction on assets,liabilities and equity?

Quick Computer Service had net income for the year of $30,000.Its assets at the beginning of the year were $400,000.At the end of the year assets were worth $450,000.Calculate its return on assets.

Beginning Assets were $700,000,Beginning Equity was $225,000,Revenue for the year was $523,000,Common Stock sold during the year totaled $320,000,Expenses for the year were $392,000,Ending Equity is $751,000,and Ending Assets are $963,000. What were the total dividends declared?

Investing activities are the acquiring and selling of resources that an organization uses in its everyday operations.