MGMT 200 EXAM 1 (PURDUE UNIVERSITY) NEWEST
2024 EXAM 1 AND PRACTICE EXAM 250 QUESTIONS
AND CORRECT DETAILED ANSWERS (VERIFIED
ANSWERS) |ALREADY GRADED A+
What is the process of identifying, measuring,
and communicating economic information to
various users?
A. Accounting
B. Management
C. Business
D. Analysis - ANSWER: A. Accounting
What makes accounting a valuable discipline?
A. Produces financial reports
B. It stores financial information in accounts
C. Provides information to make decisions
D. Records events and transactions - ANSWER: C. Provides information to make
decisions
The branch of accounting concerned with providing
management with information to facilitate planning
and control.
A. financial accounting
B. tax accounting
C. managerial accounting
D. control accounting - ANSWER: C. managerial accounting
The main objective of financial reporting is to provide
information
A. on a company's assets, liabilities, and
stockholders' equity.
B. for decision making.
C. about a company's financial performance during
a period.
D. provide stockholders information to assess an
entity's performance. - ANSWER: B. for decision making.
The area of accounting that emphasizes developing
accounting information for use within a company is
A. financial accounting.
B. managerial accounting.
C. manufacturing accounting.
,D. operations accounting - ANSWER: B. managerial accounting.
A transaction is any event, external or internal, that is
recognized in a set of financial statements.
A. True
B. False - ANSWER: a. True
Transactions must affect the financial position of
the business to be recorded in a financial
accounting system.
A. true
B. false - ANSWER: A. true
For example, the receipt of a sales order from
a customer is not recorded until the product
or service is provided to the customer.
Which of the following is a business event that is not
considered a recordable transaction?
A. A company receives a product previously
ordered.
B. A company pays an employee for work
performed
C. A customer purchases a service.
D. A customer places an order for product. - ANSWER: D. A customer places an order
for product.
Which of the following business events is not a
recordable transaction in accounting?
A. Paying wages
B. Receiving goods
C. Signing a contract
D. Purchasing a service - ANSWER: C. Signing a contract
Although signing a contract could be an important
business event it is not recorded in an accounting
system.
San Pedro Corporation recently purchased a truck for
$60,000, which will be paid within 45 days after
delivery. At what point would the event be recorded in
San Pedro's accounting system?
A. When San Pedro signs the agreement with the
seller.
B. When San Pedro receives delivery of the truck.
C. When San Pedro receives the invoice (a bill)
from the seller.
D. When San Pedro pays the $60,000 to the seller.
delivered - ANSWER: B. When San Pedro receives delivery of the truck.
, Agreement Signed - Truck Delivered - Invoice Received - Cash Payment
Assets can be best described as
A. resources owned by the company having future
benefit to the company.
B. collection of resources belonging to the
company and the claims on these resources.
C. cash owned by the company.
D. owners' investment in the business - ANSWER: A. resources owned by the
company having future
benefit to the company.
Those who lend money or deliver goods and services
before being paid are called
A. creditors.
B. investors.
C. debtors.
D. stockholders - ANSWER: A. creditors. (suppliers, bank, employees)
Which of the following accounts is not an asset?
A. Inventory
B. Cash
C. Common stock
D. Equipment - ANSWER: C. Common stock
Assets benefit future operations.
Examples are cash, inventory,
supplies, accounts receivable,
buildings and equipment.
At December 31, Burlingame, Inc., an air quality service
business, had total assets of $100,000 and equity of
$10,000. How much were Burlingame's liabilities?
A. $50,000
B. $80,000
C. $90,000
D. $110,000 - ANSWER: C. $90,000
assets ‐ equity = liabilities
$100,000 ‐ $10,000 = $90,000
Woodcrest, Inc.'s total assets increased $20,000 during a period
and total liabilities increased $10,000 during the same period,
the amount and direction (increase or decrease) of the change
in stockholders' equity for that period is:
A. a $45,000 decrease.
B. a $45,000 increase.
2024 EXAM 1 AND PRACTICE EXAM 250 QUESTIONS
AND CORRECT DETAILED ANSWERS (VERIFIED
ANSWERS) |ALREADY GRADED A+
What is the process of identifying, measuring,
and communicating economic information to
various users?
A. Accounting
B. Management
C. Business
D. Analysis - ANSWER: A. Accounting
What makes accounting a valuable discipline?
A. Produces financial reports
B. It stores financial information in accounts
C. Provides information to make decisions
D. Records events and transactions - ANSWER: C. Provides information to make
decisions
The branch of accounting concerned with providing
management with information to facilitate planning
and control.
A. financial accounting
B. tax accounting
C. managerial accounting
D. control accounting - ANSWER: C. managerial accounting
The main objective of financial reporting is to provide
information
A. on a company's assets, liabilities, and
stockholders' equity.
B. for decision making.
C. about a company's financial performance during
a period.
D. provide stockholders information to assess an
entity's performance. - ANSWER: B. for decision making.
The area of accounting that emphasizes developing
accounting information for use within a company is
A. financial accounting.
B. managerial accounting.
C. manufacturing accounting.
,D. operations accounting - ANSWER: B. managerial accounting.
A transaction is any event, external or internal, that is
recognized in a set of financial statements.
A. True
B. False - ANSWER: a. True
Transactions must affect the financial position of
the business to be recorded in a financial
accounting system.
A. true
B. false - ANSWER: A. true
For example, the receipt of a sales order from
a customer is not recorded until the product
or service is provided to the customer.
Which of the following is a business event that is not
considered a recordable transaction?
A. A company receives a product previously
ordered.
B. A company pays an employee for work
performed
C. A customer purchases a service.
D. A customer places an order for product. - ANSWER: D. A customer places an order
for product.
Which of the following business events is not a
recordable transaction in accounting?
A. Paying wages
B. Receiving goods
C. Signing a contract
D. Purchasing a service - ANSWER: C. Signing a contract
Although signing a contract could be an important
business event it is not recorded in an accounting
system.
San Pedro Corporation recently purchased a truck for
$60,000, which will be paid within 45 days after
delivery. At what point would the event be recorded in
San Pedro's accounting system?
A. When San Pedro signs the agreement with the
seller.
B. When San Pedro receives delivery of the truck.
C. When San Pedro receives the invoice (a bill)
from the seller.
D. When San Pedro pays the $60,000 to the seller.
delivered - ANSWER: B. When San Pedro receives delivery of the truck.
, Agreement Signed - Truck Delivered - Invoice Received - Cash Payment
Assets can be best described as
A. resources owned by the company having future
benefit to the company.
B. collection of resources belonging to the
company and the claims on these resources.
C. cash owned by the company.
D. owners' investment in the business - ANSWER: A. resources owned by the
company having future
benefit to the company.
Those who lend money or deliver goods and services
before being paid are called
A. creditors.
B. investors.
C. debtors.
D. stockholders - ANSWER: A. creditors. (suppliers, bank, employees)
Which of the following accounts is not an asset?
A. Inventory
B. Cash
C. Common stock
D. Equipment - ANSWER: C. Common stock
Assets benefit future operations.
Examples are cash, inventory,
supplies, accounts receivable,
buildings and equipment.
At December 31, Burlingame, Inc., an air quality service
business, had total assets of $100,000 and equity of
$10,000. How much were Burlingame's liabilities?
A. $50,000
B. $80,000
C. $90,000
D. $110,000 - ANSWER: C. $90,000
assets ‐ equity = liabilities
$100,000 ‐ $10,000 = $90,000
Woodcrest, Inc.'s total assets increased $20,000 during a period
and total liabilities increased $10,000 during the same period,
the amount and direction (increase or decrease) of the change
in stockholders' equity for that period is:
A. a $45,000 decrease.
B. a $45,000 increase.
