Test Bank For Advanced Financial Accounting, 13th
Edition By Theodore Christensen, Complete Chapters 1 -
20, Verified Newest Version
Financial statements can be prepared: (3 things) - ANSWER:Monthly, quarterly,
annually
True or false: The business entity, and not the owners, are viewed as owning the
resources and as owing the debts of the business. - ANSWER:True
The heading of a balance sheet for a company that has been in business for years
and has a June 30, 2011 year end would have: (3 things) - ANSWER:The name of the
business
The title "Balance Sheet"
At June 30, 2011
X Company purchased $5000 of supplies on credit. What does this affect and in what
way on the balance sheet? - ANSWER:Result in an increase in Accounts Payable on
the balance sheet.
The sum of what two elements equals stockholders' equity? - ANSWER:Retained
earnings and common stock
The three activities used to categorize cash inflows and outflows on the statement of
cash flows includes: - ANSWER:Operating, investing, and financing
Match each user of financial information with the type of decision:
Creditors -
Regulators -
Customers -
Managers - - ANSWER:Creditors - Decide whether to lend money
Regulators - Decide on social welfare issues
Customers - Decide whether to purchase products
Managers - Decide production and expansion
Retained Earnings definition - ANSWER:Profits earned by a company that have not
been paid to stockholders
Net Income = - ANSWER:Revenues - Expenses
Assets are initially recorded at: - ANSWER:Historical cost
What information appears on the statement of stockholders' equity? -
ANSWER:Dividends, ending balance of retained earnings, net income, beginning
balance of retained earnings.
, At December 31, Equate, Inc.'s assets equal $50,000 and liabilities equal $30,000.
Stockholders' equity must equal: - ANSWER:$20,000
The two sources of stockholders' equity are amounts: - ANSWER:Earned by the
corporation and paid in from shareholders
Equipment, land, and cash are examples of: - ANSWER:Assets
Transaction analysis is based on which two principles? - ANSWER:1. The accounting
equation remains in balance with each transaction
2. Every transaction affects at least two accounts
What accounting cycle steps describes the summarizing in ledger accounts? -
ANSWER:Dollars amounts from journal entries are copied (posted) to the
appropriate accounts in the ledger, so that account balances can be totaled.
Assets appear on the ____ side of the accounting equation - ANSWER:Left
What order do the three steps for entering a transaction in a journal go in? -
ANSWER:1. Enter name of account(s) debited and their amount(s)
2. Enter name of account(s) credited and their amounts(s)
3. Enter explanation
On the balance sheet, contributed capital appears under..? - ANSWER:Stockholders'
equity
M Company purchased a $30,000 pizza delivery truck in exchange for a 4-year note.
The company recorded this as a $30,000 debit to the Truck account and a $30,000
credit to Cash. As a result this entry's: (2 things) - ANSWER:Total liabilities are too
low & total assets are too low
The contributed capital account is increased with an entry on the ____ side of the T-
account. - ANSWER:Right
Accounting transactions are classified as which of the following? - ANSWER:External
transactions and internal transactions
Account payable is increased with an entry on the ____ side of the account. -
ANSWER:Right
Land, equipment, and buildings would be under which activity on the balance sheet -
ANSWER:Investing
A company made a $1,000 payment on its $100,000, 20-year mortgage. The
decrease in liabilities would be recorded with a ____ to Notes payable. -
ANSWER:Debit
Edition By Theodore Christensen, Complete Chapters 1 -
20, Verified Newest Version
Financial statements can be prepared: (3 things) - ANSWER:Monthly, quarterly,
annually
True or false: The business entity, and not the owners, are viewed as owning the
resources and as owing the debts of the business. - ANSWER:True
The heading of a balance sheet for a company that has been in business for years
and has a June 30, 2011 year end would have: (3 things) - ANSWER:The name of the
business
The title "Balance Sheet"
At June 30, 2011
X Company purchased $5000 of supplies on credit. What does this affect and in what
way on the balance sheet? - ANSWER:Result in an increase in Accounts Payable on
the balance sheet.
The sum of what two elements equals stockholders' equity? - ANSWER:Retained
earnings and common stock
The three activities used to categorize cash inflows and outflows on the statement of
cash flows includes: - ANSWER:Operating, investing, and financing
Match each user of financial information with the type of decision:
Creditors -
Regulators -
Customers -
Managers - - ANSWER:Creditors - Decide whether to lend money
Regulators - Decide on social welfare issues
Customers - Decide whether to purchase products
Managers - Decide production and expansion
Retained Earnings definition - ANSWER:Profits earned by a company that have not
been paid to stockholders
Net Income = - ANSWER:Revenues - Expenses
Assets are initially recorded at: - ANSWER:Historical cost
What information appears on the statement of stockholders' equity? -
ANSWER:Dividends, ending balance of retained earnings, net income, beginning
balance of retained earnings.
, At December 31, Equate, Inc.'s assets equal $50,000 and liabilities equal $30,000.
Stockholders' equity must equal: - ANSWER:$20,000
The two sources of stockholders' equity are amounts: - ANSWER:Earned by the
corporation and paid in from shareholders
Equipment, land, and cash are examples of: - ANSWER:Assets
Transaction analysis is based on which two principles? - ANSWER:1. The accounting
equation remains in balance with each transaction
2. Every transaction affects at least two accounts
What accounting cycle steps describes the summarizing in ledger accounts? -
ANSWER:Dollars amounts from journal entries are copied (posted) to the
appropriate accounts in the ledger, so that account balances can be totaled.
Assets appear on the ____ side of the accounting equation - ANSWER:Left
What order do the three steps for entering a transaction in a journal go in? -
ANSWER:1. Enter name of account(s) debited and their amount(s)
2. Enter name of account(s) credited and their amounts(s)
3. Enter explanation
On the balance sheet, contributed capital appears under..? - ANSWER:Stockholders'
equity
M Company purchased a $30,000 pizza delivery truck in exchange for a 4-year note.
The company recorded this as a $30,000 debit to the Truck account and a $30,000
credit to Cash. As a result this entry's: (2 things) - ANSWER:Total liabilities are too
low & total assets are too low
The contributed capital account is increased with an entry on the ____ side of the T-
account. - ANSWER:Right
Accounting transactions are classified as which of the following? - ANSWER:External
transactions and internal transactions
Account payable is increased with an entry on the ____ side of the account. -
ANSWER:Right
Land, equipment, and buildings would be under which activity on the balance sheet -
ANSWER:Investing
A company made a $1,000 payment on its $100,000, 20-year mortgage. The
decrease in liabilities would be recorded with a ____ to Notes payable. -
ANSWER:Debit
