Acct300 Business Accounting: Week 1 Quiz (Winter 2015)

Acct300 Business Accounting Week 1 Quiz (Winter 2015) Question 1 of 20 When a business borrows money, it incurs a(n): A. tax. B. liability. C. receivable. D. additional equity. Question 2 of 20 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 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 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 The branch of accounting related to the management's financial decisions is known as financial accounting. A. True B. False Question 6 of 20 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 The basic type of stock issued to owners is called common stock. A. True B. False Question 8 of 20 Any given transaction must affect at least two different parts of the accounting equation. A. True B. False Question 9 of 20 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 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 Assets are acquired through investing activities when resources are purchased. A. True B. False Question 12 of 20 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 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 When an account receivable is collected in cash, the total assets of the business increase. A. True B. False Question 15 of 20 The balance sheet represents the accounting equation. A. True B. False Question 16 of 20 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 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 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 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 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
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