Term
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Definition
Accounting is the information system that
A) measures business activities
B) communicates the results to decision makers
C) processes information into reports
D) all of the above |
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Term
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Definition
Which of the following is not an external user of a business's financial information?
A) taxing authorities
B) customers
C) employees
D) investors |
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Term
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Definition
Generally accepted accounting principles are currently formulated by the
A) FASB
B) SEC
C) IMA
D) AICPA |
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Term
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Definition
Which type of business is owned by only one owner?
A) Corporation
B) partnership
C) sole proprietorship
D) All of the above |
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Term
| Stockholders are not personally liable for entities debts |
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Definition
Which of the following is true of a corporation
A) single owner
B) is not taxed
C) Stockholders are not personally liable for entities debts
D) not a separate taxable entity |
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Term
| Faithful representation concept |
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Definition
Which of the following requires accounting information to be complete neutral and free from material error?
A) faithful representation concept
B) cost principle
C) economic entity assumption
D) going concern assumption |
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Term
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Definition
At the end of a recent year, global cleaning service, a full service house cleaning service, had total assets of $3,630 and equity of $2,280. How much were liabilities?
A) $5,910
B) $3,630
C) $1,350
D) $2,280 |
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Term
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Definition
Consider the overall effects on global cleaning service from selling and performing services on account for $6,400 and paying expenses totaling $2,500. What is global cleaning services net income or net loss?
A) Net income of $3,900
B) Net loss of $3,900
C) Net income of $6,400
D) Net income of $8,900 |
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Term
| Increase both assets and equity by $180 |
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Definition
Assume that GCS performed cleaning services for a department store on account for $180. How would this affect GCS's accounting equation?
A) Increase both assets and liabilities by $180
B) Increase both assets and equity by $180
C) Increase both liabilities and equity by $180
D) Decrease liabilities by $180 and increase equity by $180 |
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Term
| financial position on a specific date |
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Definition
The balance sheet reports the
A) financial position on a specific date
B) results of operations on a specific date
C) financial position for a specific period
D) results of operations for a specific period |
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Term
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Definition
Assume GCS had net income of $570 for the year. GCS beginning and ending total assets were $4,520 and $4,180. Calculate return on assets.
A) 12.6%
B) 13.6%
C) 13.1%
D) 7.63% |
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