Question 1

Stockholders in a corporation are internal stakeholders.

Accepted Answer

A) True 
 B)False

Question 2

A limited liability corporation combines attributes of a partnership and a corporation.

Accepted Answer

A) True 
 B)False

Question 3

A low-cost emphasis strives to provide

Accepted Answer

A)  no-frills,standardized products and services.
B)  products and services that provide unique market needs.
C)  products and services that provide prestige and image for customers.
D)  products and services that compete on features other than price.E) B) and D)
F) A) and B)

Question 4

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

Accepted Answer

A)  tax accounting.
B)  union contracts.
C)  managerial accounting.
D)  financial accounting.E) None of the above
F) All of the above

Question 5

Merchandising businesses must be corporations.

Accepted Answer

A) True 
 B)False

Question 6

The resources a business owns are called

Accepted Answer

A)  assets.
B)  liabilities.
C)  earnings.
D)  stockholders' equity.E) A) and B)
F) A) and D)

Question 7

Due to various fraudulent business practices and accounting coverups in the early 2000s,Congress enacted the Sarbanes-Oxley Act of 2002.The act was responsible for establishing a new oversight board for public accountants called the

Accepted Answer

A)  Generally Accepted Accounting Practices for Public Accountants Board.
B)  Public Company Accounting Oversight Board.
C)  Congressional Accounting Oversight Board.
D)  None are correct.E) A) and B)
F) A) and C)

Question 8

An entity that is organized according to state or federal statutes and in which ownership is divided into shares of stock is a

Accepted Answer

A)  proprietorship.
B)  corporation.
C)  partnership.
D)  governmental unit.E) All of the above
F) A) and B)

Question 9

Financing activities involve obtaining __________ to operate a business.

Accepted Answer

A)  products
B)  customers
C)  business incentives
D)  fundsE) A) and C)
F) C) and D) D

Question 10

Which of the following is NOT a characteristic of a cdorporation?

Accepted Answer

A)  Corporations are organized as a separate legal taxable entity.
B)  Ownership is divided into shares of stock.
C)  Corporations experience an ease in obtaining large amounts of resources by issuing stock.
D)  A corporation's resources are limited to its individual owners' resources.
E)  Corporations make up 20% of all businesses.F) A) and B)
G) C) and E)

Question 11

What is the primary objective of most businesses?

Accepted Answer

A)  To maximize profits
B)  To pay dividends to stockholders
C)  To provide a benefit to society
D)  To manufacture a quality productE) B) and D)
F) None of the above

Question 12

Match the following items with the appropriate financial statement:
a.Income statement
b.Balance sheet
c.Retained earnings statement
d.Statement of cash flows

Accepted Answer

The answer of Match the following items with the appropriate...

Question 13

Indicate whether each of the following activities would be reported on the Statement of Cash Flows as an Operating Activity,an Investing Activity,a Financing Activity,or does not appear on the Cash Flow Statement.

Accepted Answer

The answer of Indicate whether each of the following activities...

Question 14

Classify the following as:
a.Asset
b.Liability
c.Revenue
d.Expense

Accepted Answer

The answer of Classify the following as:
a.Asset
b.Liability
c.Revenue
d.Expense
 ...

Question 15

If there was no beginning retained earnings,net income of $20,000,and ending retained earnings of $6,000,how much were dividends?

Accepted Answer

A)  $10,000
B)  $4,000
C)  $6,000
D)  $14,000E) None of the above
F) A) and C)

Question 16

Who has first preference to assets in case a business fails?

Accepted Answer

A)  Stockholders
B)  Long-term creditors
C)  Customers
D)  EmployeesE) All of the above
F) None of the above

Question 17

How do businesses make money? What strategies can they use to gain competitive advantage?

Accepted Answer

Businesses have the objective of making ...

Question 18

Describe business stakeholders and the four categories in which they can be classified.

Accepted Answer

Business stakeholders are pers...

Question 19

The Balance Sheet represents the accounting equation.

Accepted Answer

A) True 
 B)False  True

Question 20

Fill in the missing amounts of the following balance sheet:

Accepted Answer

a)$2,000
b...

Exam 1: The Role of Accounting in Business

Stockholders in a corporation are internal stakeholders.

Correct AnswerverifiedShow Answer

A limited liability corporation combines attributes of a partnership and a corporation.

Correct AnswerverifiedShow Answer

A low-cost emphasis strives to provide

Correct AnswerverifiedShow Answer

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

Correct AnswerverifiedShow Answer

Merchandising businesses must be corporations.

Correct AnswerverifiedShow Answer

The resources a business owns are called

Correct AnswerverifiedShow Answer

Due to various fraudulent business practices and accounting coverups in the early 2000s,Congress enacted the Sarbanes-Oxley Act of 2002.The act was responsible for establishing a new oversight board for public accountants called the

Correct AnswerverifiedShow Answer

An entity that is organized according to state or federal statutes and in which ownership is divided into shares of stock is a

Correct AnswerverifiedShow Answer

Financing activities involve obtaining __________ to operate a business.

Correct AnswerverifiedD

Which of the following is NOT a characteristic of a cdorporation?

Correct AnswerverifiedShow Answer

What is the primary objective of most businesses?

Correct AnswerverifiedShow Answer

Match the following items with the appropriate financial statement: a.Income statement b.Balance sheet c.Retained earnings statement d.Statement of cash flows

Correct Answerverified11ea8a6e_31ea_f9e0_96ef_832606b53904_TB6232_00

Indicate whether each of the following activities would be reported on the Statement of Cash Flows as an Operating Activity,an Investing Activity,a Financing Activity,or does not appear on the Cash Flow Statement.

Correct AnswerverifiedShow Answer

Classify the following as: a.Asset b.Liability c.Revenue d.Expense

Correct AnswerverifiedShow Answer

If there was no beginning retained earnings,net income of $20,000,and ending retained earnings of $6,000,how much were dividends?

Correct AnswerverifiedShow Answer

Who has first preference to assets in case a business fails?

Correct AnswerverifiedShow Answer

How do businesses make money? What strategies can they use to gain competitive advantage?

Correct AnswerverifiedBusinesses have the objective of making ...View AnswerShow Answer

Describe business stakeholders and the four categories in which they can be classified.

Correct AnswerverifiedBusiness stakeholders are pers...View AnswerShow Answer

The Balance Sheet represents the accounting equation.

Correct AnswerverifiedTrue

Fill in the missing amounts of the following balance sheet:

Correct Answerverifieda)$2,000b...View AnswerShow Answer

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D

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11ea8a6e_31ea_f9e0_96ef_832606b53904_TB6232_00

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Businesses have the objective of making ...
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Business stakeholders are pers...
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True

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a)$2,000
b...
View Answer