FA Chapter 1

meli ssa
Quiz by meli ssa, updated more than 1 year ago
meli ssa
Created by meli ssa over 2 years ago
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Description

Quiz on FA Chapter 1, created by meli ssa on 01/31/2019.

Resource summary

Question 1

Question
The primary objective of financial reporting is to provide information
Answer
  • Useful for making investment and credit decisions
  • About the profitability of the enterprise
  • To the federal government
  • On the cash flows of the company

Question 2

Question
Which type of business organization provides the least amount of protection for bankers and other creditors of the company?
Answer
  • Partnership
  • Proprietorship
  • Corporation
  • Both a and be

Question 3

Question
Assets are usually reported at their:
Answer
  • Historical cost
  • Current market value
  • Appraised value
  • None of the above

Question 4

Question
During March, assets increased by $19.000 and liabilities increased by $6000. Shareholders' equity must have:
Answer
  • Increased by $13 000
  • Decreased by $13 000
  • Increased by $25 000
  • Decreased by $25 000

Question 5

Question
The amount a company expects to collect from customers appears on the
Answer
  • Statement of cash flows
  • Balance sheet in the current assets section
  • Income statement in the expenses section
  • Balance sheet in the shareholders' equity section

Question 6

Question
All of the following are current assets except
Answer
  • Inventory
  • Sales revenue
  • Cash
  • Accounts receivable

Question 7

Question
Revenues are
Answer
  • Decreases in liabilities resulting from paying off loans
  • Increases in paid-in capital resulting from the owners investing in the business
  • Increases in retained earnings resulting from selling products or perfoming services
  • All of the above

Question 8

Question
The financial statement that reports revenues and expenses is called the
Answer
  • Statement of cash flows
  • Income statement
  • Balance sheet
  • Statement of changes in equity

Question 9

Question
Another name for the balance sheet is the
Answer
  • Statement of financial position
  • Statement of operations
  • Statements of profit and loss
  • Statement of earnings

Question 10

Question
Rainbow Corporation began the year with cash of $32,000 and other assets that totalled $22,000. During the year Rainbow earned sales revenue of $133,000 and had the following expenses: salaries: $56,000; rent: $10,000; and utilities: $5,000. At year-end Rainbow’s cash balance
Answer
  • $62 000
  • $ 12 000
  • $20 000
  • $43 200

Question 11

Question
Advanced Instruments had retained earnings of $150,000 at December 31, 20X5. Net income for 20X6 totaled $120,000, and dividends for 20X6 were $20,000. How much retained earnings should Advanced Instruments report at December 31, 20X6?
Answer
  • $150 000
  • $ 250 000
  • $130 000
  • $290 000

Question 12

Question
Which of the following is not an enhancing qualitative characteristic?
Answer
  • Materiality
  • Understandiblity
  • Verifability
  • Comparability

Question 13

Question
. Cash paid to purchase a building appears on the statement of cash flows among the
Answer
  • Financing activities
  • Investing activities
  • Shareholders equity
  • Operating activities

Question 14

Question
The shareholders’ equity of Diakovsky Company at the beginning and end of 20X6 totaled $16,000 and $21,000, respectively. Assets at the beginning of 20X6 were $25,000. If Diakovsky Company’s liabilities increased by $8,000 in 20X6, how much were total assets at the end of 20X6? Use the accounting equation.
Answer
  • $ 41 000
  • $ 46 000
  • $ 35 000
  • $ 38 000

Question 15

Question
Answer
Answer
  • a
  • b
  • c
  • d
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