ACG Exam 1 Chapters 1-3 with all Correct & 100%
Verified Answers |Guaranteed to Pass
Fundamental quality characteristics of financial information ✔Correct Answer-relevance,
faithful presentation
Entity Assumption ✔Correct Answer-Organization stands apart from other organizations and
individuals as a separate economic unit
Continuity Assumption ✔Correct Answer-States that businesses are assumed to continue to
operate into the foreseeable future.
Historical Cost Principle ✔Correct Answer-An accounting principle that states that companies
should record assets at their actual cost on the date of purchase
Stable-Monetary unit assumption ✔Correct Answer-Assume the dollar's purchasing power is
stable over time
Balance sheet ✔Correct Answer-Reflects Assets, Liabilities, Equity at a specific date in time
Accounting Equation ✔Correct Answer-Assets = Liabilities + Owner's Equity
Assets ✔Correct Answer-Cash, Accounts Receivables, Inventories, Property, plant, equipment,
anything prepaid (prepaid insurance)
Liabilities ✔Correct Answer-Accounts payable, Income taxes payable, long term debt, accrued
salaries or anything accrued
Equity ✔Correct Answer-paid-in capital, retained earnings, common stock
paid-in capital ✔Correct Answer-the amount stockholders have invested in the company
Dividends ✔Correct Answer-assets distributed to stockholders, not an expense. decrease
retained earnings.
retained earnings ✔Correct Answer-the amount of earned income kept for use in the
business. composed of revenues expenses and dividends.
Revenues ✔Correct Answer-Inflow of resources from delivering goods/services. Increase
retained earnings. Considered sales, rent revenue
Verified Answers |Guaranteed to Pass
Fundamental quality characteristics of financial information ✔Correct Answer-relevance,
faithful presentation
Entity Assumption ✔Correct Answer-Organization stands apart from other organizations and
individuals as a separate economic unit
Continuity Assumption ✔Correct Answer-States that businesses are assumed to continue to
operate into the foreseeable future.
Historical Cost Principle ✔Correct Answer-An accounting principle that states that companies
should record assets at their actual cost on the date of purchase
Stable-Monetary unit assumption ✔Correct Answer-Assume the dollar's purchasing power is
stable over time
Balance sheet ✔Correct Answer-Reflects Assets, Liabilities, Equity at a specific date in time
Accounting Equation ✔Correct Answer-Assets = Liabilities + Owner's Equity
Assets ✔Correct Answer-Cash, Accounts Receivables, Inventories, Property, plant, equipment,
anything prepaid (prepaid insurance)
Liabilities ✔Correct Answer-Accounts payable, Income taxes payable, long term debt, accrued
salaries or anything accrued
Equity ✔Correct Answer-paid-in capital, retained earnings, common stock
paid-in capital ✔Correct Answer-the amount stockholders have invested in the company
Dividends ✔Correct Answer-assets distributed to stockholders, not an expense. decrease
retained earnings.
retained earnings ✔Correct Answer-the amount of earned income kept for use in the
business. composed of revenues expenses and dividends.
Revenues ✔Correct Answer-Inflow of resources from delivering goods/services. Increase
retained earnings. Considered sales, rent revenue
