ACCT Entrance Exam with All Correct & 100% Verified
Answers |Actual Complete Exam |Already Graded A+
Financial statements can be used by which of the following groups? ✔Correct Answer-A.
Regulatory bodies
B. Individuals
C. Investors and creditors
Nicholas is a software engineer and is starting a consulting practice. What form of business
organization limits his liability to the amount he has invested in the business? ✔Correct Answer-
Corporation
An organization's investors and creditors will primarily use information provided by: ✔Correct
Answer-the organization's financial accounting system.
The primary objective of financial reporting is to provide information ✔Correct Answer-useful for
making investment and credit decisions.
Which type of business organization provides the least amount of protection for bankers and other
creditors of the company? ✔Correct Answer-Corporation
Hoot Enterprises buys a warehouse for $520,000 to use for its East Coast distribution operations. On
the date of the purchase, a professional appraisal shows a value of $590,000 for the warehouse. The
seller had originally purchased the building for $495,000. Hoot has a similar warehouse on the West
Coast that has a book value of $531,000. Under the historical cost principle, Hoot should record the
building for ✔Correct Answer-PRICE IS ENTERPRISE BUYS THE WAREHOUSE FOR
To be useful, information must have which of the following fundamental qualitative characteristics?
✔Correct Answer-Relevance and faithful representation
Which of the following is a true statement about International Financial Reporting Standards?
✔Correct Answer-They are converging gradually with U.S. standards.
Assets are usually reported at their ✔Correct Answer-historical cost.
Assume that a business is headed for certain bankruptcy and it is evident that its liabilities greatly
exceed its assets. Which principle would be violated if its financial statements were prepared using
standard U.S. GAAP? ✔Correct Answer-Continuity assumption
The accounting equation can be expressed as ✔Correct Answer-Assets - Liabilities = Equity.
The costs of doing business are classified as: ✔Correct Answer-expenses.
How would the issuance of common stock for cash affect the accounting equation? ✔Correct
Answer-Increase assets and increase stockholders' equity
Revenues are ✔Correct Answer-increases in retained earnings resulting from selling products or
performing services.
, On which financial statement would the ending balance of the account "accounts receivable" be
found? ✔Correct Answer-Balance sheet
Which financial statement would show how well a company performed over the past year?
✔Correct Answer-Income statement
What item flows from the income statement to the statement of retained earnings? ✔Correct
Answer-Net income
What item flows from the statement of retained earnings to the balance sheet? ✔Correct Answer-
Retained earnings
The amount a company expects to collect from customers appears on the ✔Correct Answer-
balance sheet in the current assets section.
All of the following are current assets except ✔Correct Answer-accounts payable.
The financial statement that reports revenues and expenses is called the ✔Correct Answer-income
statement.
Another name for the balance sheet is the ✔Correct Answer-statement of financial position.
Net income appears on which financial statement(s)? ✔Correct Answer-Statement of retained
earnings
Income statement
Cash paid to purchase a building appears on the statement of cash flows among the ✔Correct
Answer-investing activities.
Which of the following is the most accurate statement regarding ethics as applied to decision making
in accounting? ✔Correct Answer-Ethics involves making difficult choices under pressure and should
be kept in mind in making every decision, including those involving accounting.
Which of the following factors should influence business and accounting decisions? ✔Correct
Answer-Legal
Economic
Ethical
Identify the asset from the following list of accounts: ✔Correct Answer-Inventory
Amounts owed to a company by its customers would be: ✔Correct Answer-Accounts Receivable.
Which of the following is an asset? ✔Correct Answer-A.Service Revenue
B.Salary Expense
C.Common Stock
D.None of the listed accounts is an asset.
Answers |Actual Complete Exam |Already Graded A+
Financial statements can be used by which of the following groups? ✔Correct Answer-A.
Regulatory bodies
B. Individuals
C. Investors and creditors
Nicholas is a software engineer and is starting a consulting practice. What form of business
organization limits his liability to the amount he has invested in the business? ✔Correct Answer-
Corporation
An organization's investors and creditors will primarily use information provided by: ✔Correct
Answer-the organization's financial accounting system.
The primary objective of financial reporting is to provide information ✔Correct Answer-useful for
making investment and credit decisions.
Which type of business organization provides the least amount of protection for bankers and other
creditors of the company? ✔Correct Answer-Corporation
Hoot Enterprises buys a warehouse for $520,000 to use for its East Coast distribution operations. On
the date of the purchase, a professional appraisal shows a value of $590,000 for the warehouse. The
seller had originally purchased the building for $495,000. Hoot has a similar warehouse on the West
Coast that has a book value of $531,000. Under the historical cost principle, Hoot should record the
building for ✔Correct Answer-PRICE IS ENTERPRISE BUYS THE WAREHOUSE FOR
To be useful, information must have which of the following fundamental qualitative characteristics?
✔Correct Answer-Relevance and faithful representation
Which of the following is a true statement about International Financial Reporting Standards?
✔Correct Answer-They are converging gradually with U.S. standards.
Assets are usually reported at their ✔Correct Answer-historical cost.
Assume that a business is headed for certain bankruptcy and it is evident that its liabilities greatly
exceed its assets. Which principle would be violated if its financial statements were prepared using
standard U.S. GAAP? ✔Correct Answer-Continuity assumption
The accounting equation can be expressed as ✔Correct Answer-Assets - Liabilities = Equity.
The costs of doing business are classified as: ✔Correct Answer-expenses.
How would the issuance of common stock for cash affect the accounting equation? ✔Correct
Answer-Increase assets and increase stockholders' equity
Revenues are ✔Correct Answer-increases in retained earnings resulting from selling products or
performing services.
, On which financial statement would the ending balance of the account "accounts receivable" be
found? ✔Correct Answer-Balance sheet
Which financial statement would show how well a company performed over the past year?
✔Correct Answer-Income statement
What item flows from the income statement to the statement of retained earnings? ✔Correct
Answer-Net income
What item flows from the statement of retained earnings to the balance sheet? ✔Correct Answer-
Retained earnings
The amount a company expects to collect from customers appears on the ✔Correct Answer-
balance sheet in the current assets section.
All of the following are current assets except ✔Correct Answer-accounts payable.
The financial statement that reports revenues and expenses is called the ✔Correct Answer-income
statement.
Another name for the balance sheet is the ✔Correct Answer-statement of financial position.
Net income appears on which financial statement(s)? ✔Correct Answer-Statement of retained
earnings
Income statement
Cash paid to purchase a building appears on the statement of cash flows among the ✔Correct
Answer-investing activities.
Which of the following is the most accurate statement regarding ethics as applied to decision making
in accounting? ✔Correct Answer-Ethics involves making difficult choices under pressure and should
be kept in mind in making every decision, including those involving accounting.
Which of the following factors should influence business and accounting decisions? ✔Correct
Answer-Legal
Economic
Ethical
Identify the asset from the following list of accounts: ✔Correct Answer-Inventory
Amounts owed to a company by its customers would be: ✔Correct Answer-Accounts Receivable.
Which of the following is an asset? ✔Correct Answer-A.Service Revenue
B.Salary Expense
C.Common Stock
D.None of the listed accounts is an asset.
