FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 1: Introduction to Accounting and Business

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 71

Essay

Review LaterAdd Note

Review Later

The Austin Land Company sold land for $85,000 in cash. The land was originally purchased for $65,000. At the time of the sale, $40,000 was still owed to Regions Bank. After the sale, The Austin Land Company paid off the loan. Explain the effect of the sale and the payoff of the loan on the accounting equation.

Correct Answer

verified

Total assets decrease $20,000 (Cash incr...

View Answer

Show Answer

Question 72

Essay

Review LaterAdd Note

Review Later

Simpson Auto Body Repair purchased $20,000 of machinery. The company paid $8,000 in cash at the time of the purchase and signed a promissory note for the remainder to be paid in four monthly installments. (a) How will the purchase affect the accounting equation? (b) How will the payment of the first monthly installment affect the accounting equation?

Correct Answer

verified

(a) Increase Total Assets by a net amoun...

View Answer

Show Answer

Question 73

Multiple Choice

Review LaterAdd Note

Which of the following is not a business transaction?

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

Revenues are reported when

Which of the following is not a role of accounting in business?

Krammer Company has liabilities equal to one fourth of the total assets. Krammer's stockholders' equity is $45,000. Using the accounting equation, what is the amount of liabilities for Krammer?

Managerial accountants would be responsible for providing which of the following?

The asset created by a business when it makes a sale on account is termed

An example of a general-purpose financial statement would be a report about projected price increases related to transportation costs.

Given the following data: $\begin{array}{lcl}&\text { Dec. } 31,2014&\text { Dec. } 31,2013\\\text { Total liabilities } & \$ 128,250 & \$ 120,000 \\\text { Total stockholders' equity } & 95,000 & 80,000\end{array}$ a. Compute the ratio of liabilities to stockholders' equity for each year. b. Has the creditors' risk increased or decreased from December 31, 2013, to December 31, 2014?

Amos Moving Services' account balances at March 31, 2014, the end of the current year, are listed below. The Retained Earnings balance was $180,000 at April 1, 2013, the beginning of the current year.

Which of the following is not a business transaction?

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

Clifford Moore purchased $15,000 of Star Tech stock for cash. Star Tech would

Which of the following is not a certification for accountants?

Donner Company is selling a piece of land adjacent to their business. An appraisal reported the market value of the land to be $220,000. The Focus Company initially offered to buy the land for $177,000. The companies settled on a purchase price of $212,000. On the same day, another piece of land on the same block sold for $232,000. Under the cost concept, what is the amount that will be used to record this transaction in the accounting records?

Given below are the accounts and amounts for Bright Futures Company as of August 31, 2011. All of the revenue and expense amounts are for the month of August. $\begin{array}{ll}\text { Telephone Expense } & \$ 1,150 \\\text { Cash } & 3,000 \\\text { AccountsPayable } & 1,540 \\\text { Dividends } & 800 \\\text { FeesEarned } & 15,700 \\\text { Rent Expense } & 1,400 \\\text { Supplies } & 140 \\\text { Accounts Receivable } & 1,500 \\\text { Computer Equipment } & 20,000 \\\text { Capital Stock } & 10,000 \\\text { WagesExpense } & 4,800 \\\text { Utilities Expense } & 750 \\\text { Notes Payable } & 2,400 \\\text { Retained Earnings } & 4,320 \\\text { Office Expense } & 420\end{array}$ Based on the data provided for Bright Futures Company, prepare in good format an income statement for the month ended August 31, 2011.

The accountant for Franklin Company prepared the following list of account balances from the company's records for the year ended December 31, 2011: Based on this information, is Franklin Company profitable? Explain your answer by including net income or loss.

Senior executives cannot be criminally prosecuted for the wrong doings they commit on behalf of the companies where they work.