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Exam 1: Introduction to Accounting and Business

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Question 1

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Explain the interrelationship between the Balance Sheet and the Statement of Cash Flows.

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The cash reported on the balan...

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Question 2

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Which of the following are guidelines for behaving ethically?

A) I and II.
B) II and III.
C) I and III.
D) I, II, and III.

E) C) and D)
F) None of the above

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Question 3

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The accountant for Franklin Company prepared the following list of account balances from the company's records for the year ended December 31, 2011: Determine the total assets at the end of 2011 for Franklin Company.

Only large companies such as Wal-Mart, JCP, General Motors, and the Bank of America can be organized as corporations.

Explain the meaning of: (a) the objectivity concept and (b) the unit of measure concept

How does paying a liability in cash affect the accounting equation?

Four financial statements are usually prepared for a business. The statement of cash flows is usually prepared last. The statement of owner's equity (OE) , the balance sheet (B) , and the income statement (I) are prepared in a certain order to obtain information needed for the next statement. In what order are these three statements prepared?

A statement of owner's equity reports the changes in the owner's equity for a period of time.

The assets and liabilities of Amos Moving Services at March 31, 2014, the end of the current year, and its revenue and expenses for the year are listed below. The capital of the owner was $180,000 at April 1, 2013, the beginning of the current year. Mr. Amos invested an additional $25,000 in the business during the year. Prepare a balance sheet for the current year ended March 31, 2014.

The assets and liabilities of S&P Day Spa at December 31, 2014 and its revenue and expenses for the year are listed below. The capital of the owner was $68,000 at January 1, 2014. The owner invested an additional $10,000 during the year. Prepare a balance sheet for the year ended December 31, 2014.

The statement of cash flows consists of three sections: cash flows from operating activities, cash flows from income activities, and cash flows from equity activities.

Gomez Service Company paid their first installment on their Notes Payable in the amount of $2,000. How will this transaction affect the accounting equation?

List the five steps in the process by which accounting provides information to users.

Indicate how the following transactions affect the accounting equation: (a) The purchase of supplies on account. (b) The purchase of supplies for cash. (c) A withdraw by the owner to pay personal expenses. (d) Revenues received in cash. (e) Revenues received on account.

If net income for a proprietorship was $50,000, the owner withdrew $20,000 in cash and the owner invested $10,000 in cash, the capital of the owner increased by $40,000.

Earning revenue

What is the major difference between the objective of financial accounting and the objective of managerial accounting?

Collins Landscape Company purchased various landscaping supplies on account to be used for landscape designs for their customers. How will this business transaction affect the accounting equation?

Two factors that typically lead to ethical violations are relevance and timeliness of accounting information.

Land, originally purchased for $30,000, is sold for $62,000 in cash. What is the effect of the sale on the accounting equation?