Question 1 of 20

5.0/ 5.0 Points

When a business borrows money, it incurs a(n):

A. tax.

B. liability.

C. receivable.

D. additional equity.

Question 2 of 20

5.0/ 5.0 Points

Paying expenses affects which financial statement elements?

A. Assets only

B. Stockholders’ equity only

C. Assets and stockholders’ equity

D. Assets and liabilities

Question 3 of 20

0.0/ 5.0 Points

Anthony, Inc. buys land for $50,000 cash. The net effect on assets is:

A.$50,000 increase.

B.$0.

C.$50,000 decrease.

D.$25,000 increase.

Question 4 of 20

5.0/ 5.0 Points

The basic financial statements do not include the:

A. income statement.

B. tax return.

C. balance sheet.

D. statement of cash flows.

Question 5 of 20

5.0/ 5.0 Points

The branch of accounting related to the management’s financial decisions is known as financial accounting.

A. True

B. False

Question 6 of 20

5.0/ 5.0 Points

The role of accounting in business is best defined as:

A. an information system that provides reports to stakeholders about the economic activities and condition of a business.

B.a method of forecasting the future profitability of a company.

C.the policies, procedures, and strategies used in a business.

D.transaction analysis.

Question 7 of 20

5.0/ 5.0 Points

The basic type of stock issued to owners is called common stock.

A. True

B. False

Question 8 of 20

0.0/ 5.0 Points

Any given transaction must affect at least two different parts of the accounting equation.

A. True

B. False

Question 9 of 20

5.0/ 5.0 Points

A to Z Corporation issued a $30,000 note payable to borrow cash from the bank. On the Statement of Cash Flows, the transaction would be classified as:

A. Cash Flows from Operating Activities.

B. Cash Flows from Investing Activities.

C. Cash Flows from Financing Activities.

D. Noncash transaction.

Question 10 of 20

5.0/ 5.0 Points

Reporting the financial condition of a business at a point in time and the changes in the financial condition of a business over a period of time are the two major objectives of:

A. tax accounting.

B. union contracts.

C. managerial accounting.

D. financial accounting.

Question 11 of 20

5.0/ 5.0 Points

Assets are acquired through investing activities when resources are purchased.

A. True

B. False

Question 12 of 20

5.0/ 5.0 Points

Including all relevant data a reader needs to understand the financial condition and performance of a business refers to which concept?

A. Adequate disclosure concept

B. Going concern concept

C. Objectivity concept

D. Business entity concept

Question 13 of 20

5.0/ 5.0 Points

The effect of every transaction is an increase or a decrease in one or more of the accounting equation elements.

A. True

B. False

Question 14 of 20

0.0/ 5.0 Points

When an account receivable is collected in cash, the total assets of the business increase.

A. True

B. False

Question 15 of 20

5.0/ 5.0 Points

The balance sheet represents the accounting equation.

A. True

B. False

Question 16 of 20

5.0/ 5.0 Points

Buying equipment for cash affects which account/accounts?

A. Cash only

B. Retained earnings only

C. Equipment and retained earnings

D. Cash and equipment

Question 17 of 20

5.0/ 5.0 Points

Which of the following is an appropriate representation of the accounting equation?

A. Assets + Liabilities = Stockholders’ equity

B. Assets = Liabilities + Stockholders’ equity

C. Assets = Liabilities

D. Assets = Liabilities + Retained earnings

Question 18 of 20

5.0/ 5.0 Points

Which of the following is not considered to be a liability?

A. Note payable

B. Accounts receivable

C. Unearned revenues

D. Accounts payable

Question 19 of 20

0.0/ 5.0 Points

The first month of operation showed the net cash from operating activities to be $3,760, the net cash from investing activities to be ($5,415), and the ending cash balance to be $3,425. The net cash from financing activities must be:

A.$1,770.

B.$5,080.

C.$5,750.

D.$12,600.

Question 20 of 20

0.0/ 5.0 Points

Which principle determines the amount initially entered into the records for purchases?

A. Cost principle

B. Going concern concept

C. Business entity concept

D. Objectivity concept