1|Page
ETS MFT BUSINESS NEWEST EXAM WITH ACTUAL
QUESTIONS AND CORRECT VERIFIED
ANSWERS|ALREADY GRADED A+/100%
GUARANTEED TO PASS CONCEPTS
Four financial statements in order - ....ANSWER ....✔✔
1. Income Statement
2. Retained Earnings Statement
3. Balance Sheet
4. Statement of Cash Flows
Balance Sheet - ....ANSWER ....✔✔ Reports on the
assets, liabilities, and stockholders' equity of the business
as of a specific date.
Lists assets at the top, followed by liabilities and SE
Total assets must equal total liabilities and SE
Is a snapshot of the company's financial condition at a
specific moment in time (usually the month-end or year-
end)
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Income Statement - ....ANSWER ....✔✔ Reports the
profitability of the company's operations over a specific
period of time (month, quarter, year)
Lists revenues first, followed by expenses.
Shows net income (or net loss).
Income Statement
Does not include
investment and dividend
transactions between the
stockholders
The income statement is sometimes referred to as: -
....ANSWER ....✔✔ statement of operations, earnings
statement or profit and loss statement
net income is needed to determine the ending balance in
retained earnings - ....ANSWER ....✔✔ True
Characteristics of Plant Assets - ....ANSWER ....✔✔
Plant assets are long-term assets (i.e., plant assets are
expected to be of use to the company for a number of
years).
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Plant assets have three characteristics:
1. physical substance (a definite size and shape),
2. used in the operations of a business,
3. not intended for sale to customers (e.g., inventory
items are not plant
assets)
Plant assets are referred to as: - ....ANSWER ....✔✔
Property, plant, and equipment (PPE)
Plant and equipment
Fixed assets
Types of Plant Assets - ....ANSWER ....✔✔ Land: has
an unlimited useful life
is never depreciated
Buildings: facilities used in operations (e.g., factories,
offices, warehouses, stores)
are depreciated over the course of their estimated
useful life
Equipment: assets used in operations (e.g., office
furniture, planes, delivery trucks, store check-out
counters) are depreciated over the course of their
estimated useful life
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Determining the Cost of Plant Assets - ....ANSWER
....✔✔ Plant assets are recorded at historical cost
(i.e., the cost
of an asset is what you pay for it).
Depreciated over the course of their estimated useful
life
(with the exception of land).
The recorded value of a plant asset (its cost) includes all
costs business incurs to acquire and used the asset.
Determining the Cost of Plant Assets: Land - ....ANSWER
....✔✔ All necessary expenditures to acquire/make
the land ready for its intended use increase (debit) the
Land account.
Costs typically include:
1. cash purchase price (not the listing price- these are
different),
2. closing costs (e.g., title and attorney's fees),
3. real estate agent/brokers' commissions, and
4. any accrued property taxes and/or other liens on the
land
assumed by the purchaser.
ETS MFT BUSINESS NEWEST EXAM WITH ACTUAL
QUESTIONS AND CORRECT VERIFIED
ANSWERS|ALREADY GRADED A+/100%
GUARANTEED TO PASS CONCEPTS
Four financial statements in order - ....ANSWER ....✔✔
1. Income Statement
2. Retained Earnings Statement
3. Balance Sheet
4. Statement of Cash Flows
Balance Sheet - ....ANSWER ....✔✔ Reports on the
assets, liabilities, and stockholders' equity of the business
as of a specific date.
Lists assets at the top, followed by liabilities and SE
Total assets must equal total liabilities and SE
Is a snapshot of the company's financial condition at a
specific moment in time (usually the month-end or year-
end)
,2|Page
Income Statement - ....ANSWER ....✔✔ Reports the
profitability of the company's operations over a specific
period of time (month, quarter, year)
Lists revenues first, followed by expenses.
Shows net income (or net loss).
Income Statement
Does not include
investment and dividend
transactions between the
stockholders
The income statement is sometimes referred to as: -
....ANSWER ....✔✔ statement of operations, earnings
statement or profit and loss statement
net income is needed to determine the ending balance in
retained earnings - ....ANSWER ....✔✔ True
Characteristics of Plant Assets - ....ANSWER ....✔✔
Plant assets are long-term assets (i.e., plant assets are
expected to be of use to the company for a number of
years).
,3|Page
Plant assets have three characteristics:
1. physical substance (a definite size and shape),
2. used in the operations of a business,
3. not intended for sale to customers (e.g., inventory
items are not plant
assets)
Plant assets are referred to as: - ....ANSWER ....✔✔
Property, plant, and equipment (PPE)
Plant and equipment
Fixed assets
Types of Plant Assets - ....ANSWER ....✔✔ Land: has
an unlimited useful life
is never depreciated
Buildings: facilities used in operations (e.g., factories,
offices, warehouses, stores)
are depreciated over the course of their estimated
useful life
Equipment: assets used in operations (e.g., office
furniture, planes, delivery trucks, store check-out
counters) are depreciated over the course of their
estimated useful life
, 4|Page
Determining the Cost of Plant Assets - ....ANSWER
....✔✔ Plant assets are recorded at historical cost
(i.e., the cost
of an asset is what you pay for it).
Depreciated over the course of their estimated useful
life
(with the exception of land).
The recorded value of a plant asset (its cost) includes all
costs business incurs to acquire and used the asset.
Determining the Cost of Plant Assets: Land - ....ANSWER
....✔✔ All necessary expenditures to acquire/make
the land ready for its intended use increase (debit) the
Land account.
Costs typically include:
1. cash purchase price (not the listing price- these are
different),
2. closing costs (e.g., title and attorney's fees),
3. real estate agent/brokers' commissions, and
4. any accrued property taxes and/or other liens on the
land
assumed by the purchaser.
