Question 1

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

Accepted Answer

A) True 
 B)False

Question 2

The statement of retained earnings:

Accepted Answer

A)   Reports how retained earnings changes at a point in time.
B)   Reports how retained earnings changes over a period of time.
C)   Reports on cash flows for operating, financing and investing activities over a period of time.
D)   Reports on cash flows for operating, financing and investing activities at a point in time
E)   Reports on amounts for assets, liabilities and equity at a point in time.F) All of the above
G) A) and E)

Question 3

Dividends are expenses of a business.

Accepted Answer

A) True 
 B)False

Question 4

Which accounting assumption assumes that all accounting information can be reported monthly or yearly?

Accepted Answer

A)   Business entity assumption
B)   Monetary unit assumption
C)   Value assumption
D)   Cost assumption
E)   Time period assumptionF) A) and B)
G) A) and D)

Question 5

Congress passed the Sarbanes-Oxley Act to

Accepted Answer

A)   Provide jobs to U.S. accountants and limit the number of jobs sent outside the country.
B)   Impose penalties on CEO's and CFO's who knowingly sign off on bogus accounting reports, although at this time the penalties are token amounts.
C)   Help curb financial abuses at companies that issue their stock to the public.
D)   Force auditors to attest to the absolute accuracy of the financial statements.
E)   Require that all companies publicly disclose their internal control plans.F) A) and C)
G) All of the above

Question 6

______________ is the area of accounting aimed at serving external users.

Accepted Answer

Financial ...

Question 7

Rent expense that is paid with cash appears on which of the following statements?

Accepted Answer

A)   Balance sheet
B)   Income statement
C)   Statement of retained earnings
D)   Schedule of accounts receivable
E)   Statement of cash receivedF) D) and E)
G) A) and B)

Question 8

The statement of cash flows reports information on:

Accepted Answer

A)   Revenue activities
B)   Expense activities
C)   Financing activities
D)   Equity activities
E)   Asset activitiesF) None of the above
G) A) and C)

Question 9

Social responsibility:

Accepted Answer

A)   Is a concern for the impact of one's actions on society as a whole.
B)   Is a code that helps in dealing with confidential information.
C)   Is required by the SEC.
D)   Requires that all businesses conduct social audits.
E)   Is mandated by the federal government.F) A) and B)
G) B) and D)

Question 10

Ownership of a corporation is divided into units called shares or stock.

Accepted Answer

A) True 
 B)False

Question 11

The income statement reports all of the following except:

Accepted Answer

A)   Revenues earned by a business.
B)   Expenses incurred by a business.
C)   Assets owned by a business.
D)   Net income or loss earned by a business.
E)   The time period over which the earnings occurred.F) A) and D)
G) None of the above

Question 12

Compute return on assets given net income of $13,764, beginning assets of $120,000, and ending assets of $176,000.

Accepted Answer

A)   4.65%
B)   7.82%
C)   9.3%
D)   11.47%
E)   21.51%F) None of the above
G) All of the above

Question 13

From the information given, prepare a November 30 balance sheet.
On November 1 of the current year, Lois Bell began Lois Bell, Interior Design as a corporation with an initial investment of $50,000 cash. On November 30 her records showed the following (alphabetically arranged) selected accounts and amounts:

Accepted Answer

The answer of From the information given, prepare a November...

Question 14

Lorton's Web Services has assets of $265,000 and liabilities of $130,000. Calculate the amount of equity.

Accepted Answer

Equity = $...

Question 15

An exchange of value between two entities is called:

Accepted Answer

A)   The accounting equation.
B)   Recordkeeping or bookkeeping.
C)   A business transaction.
D)   An asset.
E)   Net Income.F) All of the above
G) A) and D)

Question 16

How would the accounting equation of Boston Company be affected by the billing of a client for $10,000 of consulting work completed?

Accepted Answer

A)   +$10,000 accounts receivable, -$10,000 accounts payable.
B)   +$10,000 accounts receivable, +$10,000 accounts payable.
C)   +$10,000 accounts receivable, +$10,000 cash.
D)   +$10,000 accounts receivable, +$10,000 consulting revenue.
E)   +$10,000 accounts receivable, -$10,000 consulting revenue.F) A) and C)
G) B) and C)

Question 17

What is the opportunity component of the fraud triangle?

Accepted Answer

A)   A person thinks that there is a way to commit fraud without much chance of getting caught.
B)   A person has a really good reason to commit fraud.
C)   A person does not think of the fraudulent activity as bad.
D)   A person persuades two or more other people to assist with the fraud.
E)   A person is concerned about the impact of their actions on society.F) A) and D)
G) A) and B)

Question 18

A net loss arises when revenues exceed expenses.

Accepted Answer

A) True 
 B)False

Question 19

The income statement shows the financial position of a business on a specific date.

Accepted Answer

A) True 
 B)False

Exam 1: Introducing Financial Accounting

What is the opportunity component of the fraud triangle?

Correct Answer
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A net loss arises when revenues exceed expenses.

Correct Answer
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Compute return on assets given net income of $13,764, beginning assets of $120,000, and ending assets of $176,000.

Correct Answer
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Social responsibility:

Correct Answer
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The statement of cash flows reports information on:

Correct Answer
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Lorton's Web Services has assets of $265,000 and liabilities of $130,000. Calculate the amount of equity.

Correct Answer
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Equity = $...
View Answer

Rent expense that is paid with cash appears on which of the following statements?

Correct Answer
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The statement of retained earnings:

Correct Answer
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The income statement shows the financial position of a business on a specific date.

Correct Answer
verified

How would the accounting equation of Boston Company be affected by the billing of a client for $10,000 of consulting work completed?

Correct Answer
verified

______________ is the area of accounting aimed at serving external users.

Correct Answer
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Financial ...
View Answer

An exchange of value between two entities is called:

Correct Answer
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Correct Answer
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The income statement reports all of the following except:

Correct Answer
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Congress passed the Sarbanes-Oxley Act to

Correct Answer
verified

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

Correct Answer
verified

Which accounting assumption assumes that all accounting information can be reported monthly or yearly?

Correct Answer
verified

Dividends are expenses of a business.

Correct Answer
verified

Ownership of a corporation is divided into units called shares or stock.

Correct Answer
verified

Exam 1: Introducing Financial Accounting

What is the opportunity component of the fraud triangle?

Correct AnswerverifiedShow Answer

A net loss arises when revenues exceed expenses.

Correct AnswerverifiedShow Answer

Compute return on assets given net income of $13,764, beginning assets of $120,000, and ending assets of $176,000.

Correct AnswerverifiedShow Answer

Social responsibility:

Correct AnswerverifiedShow Answer

The statement of cash flows reports information on:

Correct AnswerverifiedShow Answer

Lorton's Web Services has assets of $265,000 and liabilities of $130,000. Calculate the amount of equity.

Correct AnswerverifiedEquity = $...View AnswerShow Answer

Rent expense that is paid with cash appears on which of the following statements?

Correct AnswerverifiedShow Answer

The statement of retained earnings:

Correct AnswerverifiedShow Answer

The income statement shows the financial position of a business on a specific date.

Correct AnswerverifiedShow Answer

How would the accounting equation of Boston Company be affected by the billing of a client for $10,000 of consulting work completed?

Correct AnswerverifiedShow Answer

______________ is the area of accounting aimed at serving external users.

Correct AnswerverifiedFinancial ...View AnswerShow Answer

An exchange of value between two entities is called:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

The income statement reports all of the following except:

Correct AnswerverifiedShow Answer

Congress passed the Sarbanes-Oxley Act to

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Which accounting assumption assumes that all accounting information can be reported monthly or yearly?

Correct AnswerverifiedShow Answer

Dividends are expenses of a business.

Correct AnswerverifiedShow Answer

Ownership of a corporation is divided into units called shares or stock.

Correct AnswerverifiedShow Answer

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Equity = $...
View Answer

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Financial ...
View Answer

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