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Exam 1: Accounting in Business

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Question 71

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For each of the following transactions,identify the effects as reflected in the accounting equation.Use "+" to indicate an increase and "-" to indicate a decrease.Use "A","L",and "E" to indicate assets,liabilities,and equity,respectively.Part A has been completed as an example.

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a.+A +E
b.+A +L
c.+A...

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Question 72

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

A) True
B) False

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Question 73

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If the liabilities of a company increased $92,000 during a period of time and equity in the business decreased $30,000 during the same period,did the assets of the company increase or decrease? By what amount?

On June 30 of the current year,the assets and liabilities of Phoenix,Inc.are as follows: Cash $20,500; Accounts Receivable,$7,250; Supplies,$650; Equipment,$12,000; Accounts Payable,$9,300.What is the amount of owner's equity as of June 30 of the current year?

Describe the three types of activities reported on the statement of cash flows.

________________________________ reports changes in the owner's claim on the business's assets over a period of time.

If assets are $99,000 and liabilities are $32,000,then equity equals:

Match the following definitions with the terms Place the letter that identifies the best definition to the term.

Owner's equity is increased when cash is received from customers in payment of previously recorded accounts receivable.

The accounts of Garfield Company with the increases or decreases that occurred during the past year are as follows: Account Increase Decrease Cash $25,000 Accounts receivable $(5,000) Accounts payable (11,000) Notes payable 16,000 Except for net income,an investment of $3,000 by the owner,and a withdrawal of $11,000 by the owner,no other items affected the owner's capital account.Using the balance sheet equation,compute net income for the past year.

The records of Skymaster Airplane Rentals show the following information as of December 31.Skymaster withdrew $52,000 during the year for personal expenses.Prepare a December income statement,a December statement of owner's equity,and a December 30 balance sheet.

The rule that requires financial statements to reflect the assumption that the business will continue operating instead of being closed or sold,unless evidence shows that it will not continue,is the:

A limited partnership:

The group that attempts to create more harmony among the accounting practices of different countries is the:

The basic financial statements include all of the following except:

An exchange of value between two entities is called:

U.S.Government Treasury bonds provide high return and low risk to investors.

Accounting is an information and measurement system that identifies,records,and communicates relevant,reliable,and comparable information about an organization's business activities.

Liabilities are the owner's claim on assets.

Operating activities include long-term borrowing and repaying cash from lenders,and cash investments or withdrawals by the owner.