ACG 2021 Exam 1
Balance Sheet Correct Answer: a financial statement that reports the assets and claims to those assets
at a specific point in time
Basic accounting equation Correct Answer: Assets= Liabilities + Equity
Common Stock Correct Answer: the total amount paid in by stockholders for the shares they purchase
Corporation Correct Answer: a business organized as a separate legal entity having ownership divided
into transferable shares of stock
Dividends Correct Answer: payments of cash from a corporation to its stockholders
Expenses Correct Answer: the cost of assets consumed or services used in the process of generating
revenues
income statement Correct Answer: a financial statement that presents the revenues and expenses and
resulting net income or net loss of a company for a specific period of time
liabilities Correct Answer: the debts and obligations of a business.
Liabilities represent the amounts owed to creditors
net income Correct Answer: the amount by which revenues exceed expenses
net loss Correct Answer: the amount by which expenses exceed revenues
partnership Correct Answer: a business owned by two or more persons associated as partners
retained earnings Correct Answer: the amount of net income retained in the corporation
retained earnings statement Correct Answer: a financial statement that summarizes the amounts and
causes of changes in retained earnings for a specific period of time
revenue Correct Answer: the increase in assets that result from the sale of a product or service in the
normal course of business
sole proprietorship Correct Answer: a business owned by one person
statement of cash flows Correct Answer: a financial statement that provides financial information about
the cash receipts and cash payments of a business for a specific period of time
stockholder's equity Correct Answer: the owners' claim on total assets
Balance Sheet Correct Answer: a financial statement that reports the assets and claims to those assets
at a specific point in time
Basic accounting equation Correct Answer: Assets= Liabilities + Equity
Common Stock Correct Answer: the total amount paid in by stockholders for the shares they purchase
Corporation Correct Answer: a business organized as a separate legal entity having ownership divided
into transferable shares of stock
Dividends Correct Answer: payments of cash from a corporation to its stockholders
Expenses Correct Answer: the cost of assets consumed or services used in the process of generating
revenues
income statement Correct Answer: a financial statement that presents the revenues and expenses and
resulting net income or net loss of a company for a specific period of time
liabilities Correct Answer: the debts and obligations of a business.
Liabilities represent the amounts owed to creditors
net income Correct Answer: the amount by which revenues exceed expenses
net loss Correct Answer: the amount by which expenses exceed revenues
partnership Correct Answer: a business owned by two or more persons associated as partners
retained earnings Correct Answer: the amount of net income retained in the corporation
retained earnings statement Correct Answer: a financial statement that summarizes the amounts and
causes of changes in retained earnings for a specific period of time
revenue Correct Answer: the increase in assets that result from the sale of a product or service in the
normal course of business
sole proprietorship Correct Answer: a business owned by one person
statement of cash flows Correct Answer: a financial statement that provides financial information about
the cash receipts and cash payments of a business for a specific period of time
stockholder's equity Correct Answer: the owners' claim on total assets
