FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 1: Accounting in Business

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 101

Essay

Review LaterAdd Note

Review Later

Identify and describe the two main groups involved in establishing generally accepted accounting principles.

Correct Answer

verified

The Financial Accounting Standards Board...

View Answer

Show Answer

Question 102

True/False

Review LaterAdd Note

Review Later

External auditors examine financial statements to verify that they are prepared according to generally accepted accounting principles.

A) True
B) False

Correct Answer

verified

Show Answer

Question 103

Multiple Choice

Review LaterAdd Note

Atkins Company collected $1,750 as payment for the amount owed by a customer from services provided the prior month on credit. How does this transaction affect the accounting equation for Atkins?

The fraud triangle asserts that the three factors that must exist for a person to commit fraud are opportunity, pressure, and rationalization.

Regulators often have legal authority over certain activities of organizations.

If the assets of a company increase by $55,000 during the year and its liabilities increase by $25,000 during the same year, then the change in equity of the company during the year must have been:

Risk is the uncertainty about the return we will earn.

Unlimited liability and separate taxation of the business are advantages of a sole proprietorship.

How does the going-concern principle affect reporting asset values of a business?

The business entity assumption means that a business is accounted for separately from other business entities, including its owner or owners.

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

The rule that (1) requires revenue to be recognized at the time it is earned, (2) allows the inflow of assets associated with revenue to be in a form other than cash, and (3) measures the amount of revenue as the cash plus the cash equivalent value of any noncash assets received from customers in exchange for goods or services, is called the:

An external transaction is an exchange within an entity that may or may not affect the accounting equation.

There are three major types of business activities. ________________ activities are the means organizations use to pay for resources such as land, building, and equipment to carry out plans.

The four basic financial statements include the balance sheet, income statement, statement of retained earnings, and statement of cash flows.

If a company uses $1,300 of its cash to purchase supplies, the effect on the accounting equation would be:

An example of an investing activity is:

Explain why ethics are an integral part of accounting.

Ending retained earnings on the statement of retained earnings is calculated by adding stockholder investments and net losses and subtracting net income and dividends.

Determine the net income of a company for which of the following information is available for the month of September. $\begin{array} { | l | r |} \hline \text { Service revenue } & \$ 300,000 \\\hline \text { Rent expense } & 48,000 \\\hline \text { Utilities expense } & 3,200 \\\hline \text { Salaries expense } & 81,000 \\\hline\end{array}$