Test Bank - Survey of Accounting 7th Edition by Christopher T. Edmonds, All Chapters.pdf

Test Bank for Survey of Accounting 10e 10th Edition by Carl Warren, Amanda Farmer
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Chapg 01g 10eg Warren
All Chapters
g

Indicateg whetherg theg statementg isg trueg org false.
g 1.gThegpopularitygofgthegsolegproprietorshipgisgduegtogthegeasegandglowgcostgofgorganizing.
a. True
b. False

ANSWER:g True

g 2.gAgcorporationgisgagbusinessgthatgisglegallygseparategandgdistinctgfromgitsgowners.
a. True
b. False

ANSWER:g True

g 3.gMerchandisinggbusinessesgproducegproductsgrathergthangprovidegservicesgtogcustomers.
a. True
b. False

ANSWER:g False

g 4.gAgpartnershipgisgownedgbygtwogorgmoregindividuals.
a. True
b. False

ANSWER:g True

g 5.gAglimitedgliabilitygcompanygcombinesgattributesgofgagpartnershipgandgagcorporation.
a. True
b. False

ANSWER:g True

g 6.gThegownershipgofgagproprietorshipgisgdividedgintogsharesgofgstockgownedgbygitsgstockholders.
a. True
b. False

ANSWER:g False

g 7.gAccountinggisgoftengcalledgtheg"languagegofgbusiness"gbecausegbusinessginformationgisgcommunicatedgtog
stakeholders.
a. True
b. False

ANSWER:g True




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,Name: Class: Date:

Chapg 01g 10eg Warren

g 8.gJohngDeeregisgagleadinggmanufacturergofgagriculturalgmachinerygingthegworld,gproducinggproductsgthatgserveguni
quegmarketgneeds.gTherefore,gJohngDeeregisgangexamplegofgagcompanygthatgusesgagpremium-
pricegapproachgtogattractgcustomers.
a. True
b. False

ANSWER:g True

g 9.gCreditorsghavegpreferencegtogassetsgbehindgstockholdersgifgagbusinessgfails.
a. True
b. False

ANSWER:g False

g 10.gAgliabilitygisgaglegalgobligationgtogrepaygthegamountgborrowedgaccordinggtogthegtermsgofgthegborrowinggagreement.
a. True
b. False

ANSWER:g True

g 11.gThegbalancegsheetgrepresentsgthegaccountinggequation.
a. True
b. False

ANSWER:g True

g 12.gAgprimarygdisadvantagegofgcorporationsgisgthatgthegfinancialgresourcesgavailablegtogthemgareglimited.
a. True
b. False

ANSWER:g False

g 13.gAssetsgaregacquiredgthroughginvestinggactivitiesgwhengresourcesgaregpurchased.
a. True
b. False

ANSWER:g True

g 14.gThegobjectivegofgmostgbusinessesgisgtogmaximizegprofits.
a. True
b. False

ANSWER:g True




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,Name: Class: Date:

Chapg 01g 10eg Warren

g 15.gThegstockholders'gequitygofgagcompanygshouldgequalgthegsumgofgitsgtotalgassetsgandgtotalgliabilities.
a. True
b. False

ANSWER:g False

g 16.gThegbranchgofgaccountinggrelatedgtogthegmanagement'sgfinancialgdecisionsgisgknowngasgfinancialgaccounting.
a. True
b. False

ANSWER:g False

g 17.gAllgmerchandisinggbusinessesgaregorganizedgasgcorporations.
a. True
b. False

ANSWER:g False

g 18.gStockholdersgofgagcorporationgaregitsginternalgstakeholders.
a. True
b. False

ANSWER:g False

g 19.gThegbasicgtypegofgstockgissuedgtogownersgisgcalledgcommongstock.
a. True
b. False

ANSWER:g True

g 20.gAgbusinessgstakeholderghasganginterestgingthegeconomicgperformancegofgagcompany.
a. True
b. False

ANSWER:g True

g 21.gManufacturinggbusinessesgchangegbasicginputsgintogproductsgthatgaregsoldgtogindividualgcustomers.
a. True
b. False

ANSWER:g True

g 22.gCompaniesgusinggaglow-costgemphasisgprovidegproductsgandgservicesgthatgcompetegongfeaturesgothergthangprice.
a. True
b. False

ANSWER:g False


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, Name: Class: Date:

Chapg 01g 10eg Warren

Indicateg theg answerg choiceg thatg bestg completesg theg statementg org answersg theg question.
g 23.gWhengagbusinessgborrowsgmoney,gwhichgofgthegfollowinggisgincurred?
a. Angaccumulatedgdepletion
b. Agliability
c. Agloss
d. Angaccruedgexpenditure

ANSWER:g b

g 24.gWhatgisgthegprimarygobjectivegofgmostgbusinesses?
a. Togmaximizegprofits
b. Togpaygdividendsgtogstockholders
c. Togprovidegagbenefitgtogsociety
d. Togmanufacturegagqualitygproduct

ANSWER:g a

g 25.gAgnotegpayablegrequiresgpaymentgofgthegamountgborrowedgplusg .
a. interest
b. tax
c. overhead
d. dividend

ANSWER:g a

g 26.gIfgtheregaregnogbeginninggretainedgearnings,gnetgincomegofg$31,200,gandgendinggretainedgearningsgofg$9,000,ghowg
muchgaregdividends?
a. $40,200
b. $9,000
c. $22,200
d. $4,500

ANSWER:g c

g 27.gWhichgofgthegfollowinggisgnotgangexamplegofgagcapitalgmarketgstakeholder?
a. Banks
b. Owners
c. Suppliers
d. Stockholders

ANSWER:g c




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