Principles of Financial Accounting, 2002e
Part 1: Uses of Accounting Information plus the Financial Assertions
1 . A company's capacity to attract and hold investment capital ultimately is determined by its
C. new product creation
2 . A primary user of accounting details, with a direct financial desire for the business, is a
A. Regulatory agency
W. Tax authority
D. Labor union
a few. The separate entity concept requires that
A. Taxes records has to be kept individual from financial reporting information.
B. the personal assets and liabilities of the owner certainly not be demonstrated on the organisation’s financial statements
C. Orders that entail an exchange of value always be kept individual from those that do not.
Deb. a separate set of books be established for every segment of your business.
four. Which in the following is known as a characteristic of a corporation?
A. Not a independent economic product
B. Infinite liability of owners
C. Individual legal enterprise
D. Blended when possession changes
5. Liabilities are influenced by the
A. Purchase of equipment for money.
B. Billing of a customer for solutions performed.
C. Payment into a supplier to get office supplies purchased about credit.
Deb. Withdrawal of cash by the owner.
6. At the start of the year, Risko Company had assets of $85, 500 and owner's equity of $40, 000. If assets increased by simply $30, 000 and liabilities increased simply by $35, 500, what was the owner's equity at the end in the year?
A. $45, 500
B. $5, 000
C. $80, 1000
D. $35, 000
several. The collection of fees in cash the moment services will be performed
A. Increases possessions and raises owner's fairness.
B. Lessens assets and reduces liability.
C. Decreases assets and decreases customer's equity.
D. Decreases resources and improves liabilities.
8. Which of the following monetary statements is involved with the enterprise at a certain point in time?
A. Statement of money flows
N. Income assertion
C. Affirmation of user's equity
Deb. Balance sheet
on the lookout for. Which from the following organizations has primary responsibility intended for developing and issuing rules on accounting practice?
15. Which from the following is not one of the broad principles root the accountant's code of professional carry out?
11. The purchase of machines are an example of a financing activity.
12. Increasing the value of a bale of hay from $4. 00 per bale to $5. 00 per bale is among the a business deal.
13. A partnership may differ from a sole proprietorship in that the partners have limited responsibility and a sole manager has infinite liability.
14. At the beginning of the year, Chock Business had 50 dollars, 000 in assets and $20, 1000 in financial obligations. At the end with the year, the business had $80, 000 in assets and $40, 1000 in debts. If, in the past year, no purchases were made in the commercial and the owner withdrew $2, 000, net gain for the year must have been $8, 1000.
15. One way of stating the accounting formula is Resources + Financial obligations = Owner's Equity.
of sixteen. Decreases in both the Money and Accounts Payable accounts represent the payment of a liability
seventeen. Equipment is an asset that is deemed nonmonetary in nature.
18. If the Funds balance reported on the Balance Sheet as of 12 , 31, 20x2 is $45, 600, then Cash at End of Month, reported on the Assertion of Cash Runs for the month finished December thirty-one, 20x2, will also be $45, six hundred.
A. The case
19. The statement of cash flows...