MGMT 200 EXAM 1 (PURDUE
UNIVERSITY) NEWEST 2024 EXAM 1- 100
QUESTIONS AND CORRECT DETAILED
ANSWERS (VERIFIED ANSWERS)
|ALREADY GRADED A+
Which statement below best describes the accounting
equation?
A. The change in retained earnings equals net
income less dividends.
B. Equality of revenue and expense transactions
over time.
C. Financing activities equal investing and
operating activities.
D. Resources of the company equal creditors' and
owners' claims to those resources. - ANSWER >>> D. Resources of
the company equal creditors' and
owners' claims to those resources.
(assets = liabilities + stockholders' equity)
Owners' claims to the company's resources are
referred to as:
A. Liabilities.
B. Assets.
C. Stockholders' equity.
D. Net liabilities. - ANSWER >>> C. Stockholders' equity.
(assets = liabilities + stockholders' equity)
If total assets of a company equal $25,000 and
total stockholders' equity equals $10,000, then
total liabilities equal $15,000.
A. True
B. False - ANSWER >>> A. True
,(Assets = Liabilities + Equity
$25,000 = $15,000 + $10,000)
Amounts owed to suppliers for supplies
purchased on account are defined as a(n):
A. Revenue.
B. Asset.
C. Liability.
D. Expense. - ANSWER >>> C. Liability
(assets = liabilities + stockholders' equity)
If total liabilities of a company equal $29,000
and total stockholders' equity equals $15,000,
then total assets equal $14,000.
A. True
B. False - ANSWER >>> B. False
(Assets = Liabilities + Equity
$44,000 = $29,000 + $15,000)
Financial accounting does not deal with which of the following?
A. Measuring a company's economic activity.
B. Providing information to internal users.
C. Preparing financial reports.
D. Communicating financial results to
investors. - ANSWER >>> B. Providing information to internal users.
The accounting equation shows that a
company's resources equal creditors' and owners' claims to those
resources.
A. True
B. False - ANSWER >>> A. True
An alternative form of the accounting equation is:
A. Assets ‐ Liabilities = Stockholders' Equity.
B. Net Income = Revenues ‐ Expenses.
C. Stockholders' Equity = Assets + Liabilities.
,D. Assets = Liabilities ‐ Stockholders' Equity. - ANSWER >>> A.
Assets ‐ Liabilities = Stockholders' Equity.
Which of the following does not represent an asset of a company?
A. Supplies held by the company.
B. Amounts owed to suppliers.
C. Equipment owned and used for
operations.
D. Amounts receivable from customers. - ANSWER >>> B. Amounts
owed to suppliers.
(Liability)
The amounts recorded when the company sells
products or provides services to customers are
referred to as:
A. Liabilities
B. Revenues
C. Assets
D. Expenses - ANSWER >>> B. Revenues
(Revenues are recorded at the time
the company provides products or
services to customers)
If a company has stockholders' equity of $25,000 at the
end of the year, which of the following statements
must be true?
A. The company has issued $25,000 of common
stock.
B. Net income for the year equals $25,000.
C. The company's assets exceed liabilities by
$25,000.
D. Total revenues during the year equal $25,000. - ANSWER >>> C.
The company's assets exceed liabilities by
$25,000.
(assets = liabilities + stockholders' equity
assets ‐ liabilities = stockholders' equity
, assets ‐ liabilities = $25,000)
The costs of providing goods and services to
customers are referred to as:
A. Assets
B. Expenses
C. Liabilities
D. Revenues - ANSWER >>> B. Expenses
Using the information below from the accounting records of
Knomark Corporation, stockholders' claims to the company's
resources amount to:
-Assets $1,200,000
-Liabilities $800,000
-Net income $100,000
-Retained earnings $250,000
A. $1,200,000
B. $800,000.
C. $250,000
D. $400,000 - ANSWER >>> D. $400,000
(assets = liabilities + stockholders' equity
$1,200,000 = $800,000 + $400,000)
Which of the following best describes revenue?
A. Resources of a company.
B. Sales of goods and services to a customer.
C. Cash received from a customer.
D. Dividends paid to stockholders. - ANSWER >>> B. Sales of goods
and services to a customer.
The difference between revenues and expenses
is referred to as net income or net loss.
A. True
B. False - ANSWER >>> A. True
UNIVERSITY) NEWEST 2024 EXAM 1- 100
QUESTIONS AND CORRECT DETAILED
ANSWERS (VERIFIED ANSWERS)
|ALREADY GRADED A+
Which statement below best describes the accounting
equation?
A. The change in retained earnings equals net
income less dividends.
B. Equality of revenue and expense transactions
over time.
C. Financing activities equal investing and
operating activities.
D. Resources of the company equal creditors' and
owners' claims to those resources. - ANSWER >>> D. Resources of
the company equal creditors' and
owners' claims to those resources.
(assets = liabilities + stockholders' equity)
Owners' claims to the company's resources are
referred to as:
A. Liabilities.
B. Assets.
C. Stockholders' equity.
D. Net liabilities. - ANSWER >>> C. Stockholders' equity.
(assets = liabilities + stockholders' equity)
If total assets of a company equal $25,000 and
total stockholders' equity equals $10,000, then
total liabilities equal $15,000.
A. True
B. False - ANSWER >>> A. True
,(Assets = Liabilities + Equity
$25,000 = $15,000 + $10,000)
Amounts owed to suppliers for supplies
purchased on account are defined as a(n):
A. Revenue.
B. Asset.
C. Liability.
D. Expense. - ANSWER >>> C. Liability
(assets = liabilities + stockholders' equity)
If total liabilities of a company equal $29,000
and total stockholders' equity equals $15,000,
then total assets equal $14,000.
A. True
B. False - ANSWER >>> B. False
(Assets = Liabilities + Equity
$44,000 = $29,000 + $15,000)
Financial accounting does not deal with which of the following?
A. Measuring a company's economic activity.
B. Providing information to internal users.
C. Preparing financial reports.
D. Communicating financial results to
investors. - ANSWER >>> B. Providing information to internal users.
The accounting equation shows that a
company's resources equal creditors' and owners' claims to those
resources.
A. True
B. False - ANSWER >>> A. True
An alternative form of the accounting equation is:
A. Assets ‐ Liabilities = Stockholders' Equity.
B. Net Income = Revenues ‐ Expenses.
C. Stockholders' Equity = Assets + Liabilities.
,D. Assets = Liabilities ‐ Stockholders' Equity. - ANSWER >>> A.
Assets ‐ Liabilities = Stockholders' Equity.
Which of the following does not represent an asset of a company?
A. Supplies held by the company.
B. Amounts owed to suppliers.
C. Equipment owned and used for
operations.
D. Amounts receivable from customers. - ANSWER >>> B. Amounts
owed to suppliers.
(Liability)
The amounts recorded when the company sells
products or provides services to customers are
referred to as:
A. Liabilities
B. Revenues
C. Assets
D. Expenses - ANSWER >>> B. Revenues
(Revenues are recorded at the time
the company provides products or
services to customers)
If a company has stockholders' equity of $25,000 at the
end of the year, which of the following statements
must be true?
A. The company has issued $25,000 of common
stock.
B. Net income for the year equals $25,000.
C. The company's assets exceed liabilities by
$25,000.
D. Total revenues during the year equal $25,000. - ANSWER >>> C.
The company's assets exceed liabilities by
$25,000.
(assets = liabilities + stockholders' equity
assets ‐ liabilities = stockholders' equity
, assets ‐ liabilities = $25,000)
The costs of providing goods and services to
customers are referred to as:
A. Assets
B. Expenses
C. Liabilities
D. Revenues - ANSWER >>> B. Expenses
Using the information below from the accounting records of
Knomark Corporation, stockholders' claims to the company's
resources amount to:
-Assets $1,200,000
-Liabilities $800,000
-Net income $100,000
-Retained earnings $250,000
A. $1,200,000
B. $800,000.
C. $250,000
D. $400,000 - ANSWER >>> D. $400,000
(assets = liabilities + stockholders' equity
$1,200,000 = $800,000 + $400,000)
Which of the following best describes revenue?
A. Resources of a company.
B. Sales of goods and services to a customer.
C. Cash received from a customer.
D. Dividends paid to stockholders. - ANSWER >>> B. Sales of goods
and services to a customer.
The difference between revenues and expenses
is referred to as net income or net loss.
A. True
B. False - ANSWER >>> A. True
