ACCT 2000 Lowe-Ardoin Latest 2025 Exam
with Q’s & Answers)
What are the four types of financial statements? - ✔✔income statement, retained
earnings statement, and balance sheet
What is the purpose of an income statement? - ✔✔to report revenue and expenses over
a period of time
What are the components of an income statement? - ✔✔revenues - expenses = net income
What is the retained earnings statement? - ✔✔reports the net income retained in
the business and any changes in the net income
What is the purpose of a balance sheet? - ✔✔reports assets and claims to assets at a
specific point in time
What is the equation used for the balance sheet? (accounting equation) - ✔✔Asset
= Liabilities + Stockholder's Equity
What are assets? - ✔✔resources owned by a business
What are liabilities? - ✔✔amounts owed to creditors/suppliers
What is stockholder's equity? - ✔✔Owner's claims to assets
, What is common stock? - ✔✔amounts received from issuing (selling) shares of stock
What are retained earnings? - ✔✔the net income retained in the business
What are dividends? - ✔✔cash payments to stockholders
What are revenues? - ✔✔amounts earned from sale of products or services
What are expenses? - ✔✔cost of assets consumed or services used
What is net income? - ✔✔when revenues are greater than expenses
What is net loss? - ✔✔when expenses are greater than revenue
What are the four components of an annual report? - ✔✔financial statements,
management discussion and analysis, notes to financial statements, auditor's reports
Financial scandals led Congress to the pass the _______________________________ (aka SOX)
in 2002. - ✔✔Sarbanes-Oxley Act
What are the two types of financing? - ✔✔debt and equity
What is the management discussion and analysis (MD&A)? - ✔✔management's discussion
of trends, ability to pay debts, and results of operations
What are the notes to financial statements for? - ✔✔to clarify financial statements and give
additional info and details
with Q’s & Answers)
What are the four types of financial statements? - ✔✔income statement, retained
earnings statement, and balance sheet
What is the purpose of an income statement? - ✔✔to report revenue and expenses over
a period of time
What are the components of an income statement? - ✔✔revenues - expenses = net income
What is the retained earnings statement? - ✔✔reports the net income retained in
the business and any changes in the net income
What is the purpose of a balance sheet? - ✔✔reports assets and claims to assets at a
specific point in time
What is the equation used for the balance sheet? (accounting equation) - ✔✔Asset
= Liabilities + Stockholder's Equity
What are assets? - ✔✔resources owned by a business
What are liabilities? - ✔✔amounts owed to creditors/suppliers
What is stockholder's equity? - ✔✔Owner's claims to assets
, What is common stock? - ✔✔amounts received from issuing (selling) shares of stock
What are retained earnings? - ✔✔the net income retained in the business
What are dividends? - ✔✔cash payments to stockholders
What are revenues? - ✔✔amounts earned from sale of products or services
What are expenses? - ✔✔cost of assets consumed or services used
What is net income? - ✔✔when revenues are greater than expenses
What is net loss? - ✔✔when expenses are greater than revenue
What are the four components of an annual report? - ✔✔financial statements,
management discussion and analysis, notes to financial statements, auditor's reports
Financial scandals led Congress to the pass the _______________________________ (aka SOX)
in 2002. - ✔✔Sarbanes-Oxley Act
What are the two types of financing? - ✔✔debt and equity
What is the management discussion and analysis (MD&A)? - ✔✔management's discussion
of trends, ability to pay debts, and results of operations
What are the notes to financial statements for? - ✔✔to clarify financial statements and give
additional info and details
