FiltersDone

Question type

Essay

Multiple Choice

Short Answer

True False

Matching

Exam 1: An Introduction to Accounting

Show Answer

Share

---

All types

Filters

Study FlashcardsPractice ExamLearn

Question 1

Multiple Choice

Review LaterAdd Note

Review Later

During Year 2,Millstone Company provided $6,500 of services for cash,paid cash dividends of $1,000 to owners,and paid $4,000 cash for expenses.Liabilities were unchanged.Which of the following statements accurately describes the effect of these events on the elements of the company's financial statements?

A) Assets increased by $6,500.
B) Assets increased by $1,500.
C) Equity increased by $2,500.
D) Assets increased by $5,500.

E) C) and D)
F) A) and B)

Correct Answer

verified

Show Answer

Question 2

Multiple Choice

Review LaterAdd Note

Review Later

A company's total assets increased during the period while its liabilities and common stock were unchanged.No dividends were declared or paid during the period.Which of the following would explain this situation?

A) Revenues were greater than expenses during the period.
B) Retained earnings were less than net income during the period.
C) No dividends were paid during the period.
D) The company must have purchased assets with cash during the period.

E) A) and B)
F) A) and C)

Correct Answer

verified

Show Answer

Question 3

Multiple Choice

Review LaterAdd Note

Ballard Company reported assets of $500 and liabilities of $200.What amount will Ballard's report for stockholders' equity?

The following information applies to the questions displayed below Packard Company engaged in the following transactions during Year 1, its first year of operations: (Assume all transactions are cash transactions.) 1) Acquired $950 cash from the issue of common stock. 2) Borrowed $420 from a bank. 3) Earned $650 of revenues. 4) Paid expenses of $250. 5) Paid a $50 dividend. During Year 2, Packard engaged in the following transactions: (Assume all transactions are cash transactions.) 1) Issued an additional $325 of common stock. 2) Repaid $220 of its debt to the bank. 3) Earned revenues of $750. 4) Incurred expenses of $360. 5) Paid dividends of $100. -What is the amount of assets that will be reported on Packard's balance sheet at the end of Year 2?

Zimmerman Company sold land for $25,000 cash.The original cost of the land was $25,000.Which of the following accurately reflects how this event affects the company's financial statements?

As of December 31,Year 2,Bristol Company had $100,000 of assets,$40,000 of liabilities and $25,000 of retained earnings.What percentage of Bristol's assets were obtained through investors?

In a market,creditors are resource providers.

An asset use transaction does not affect the total amount of claims to a company's assets.

Which of the following is not an example of an asset use transaction?

Which of the following could describe the effects of an asset exchange transaction on the elements of a company's financial statements?

Robertson Company paid $1,850 cash for rent expense.What happened as a result of this business event?

Which of the following statements is false regarding managerial accounting information?

The historical cost concept requires that most assets be recorded at the amount paid for them,regardless of increases in market value.

Borrowing money from the bank is an example of an asset source transaction.

Which of the following does not describe the effects of an asset use transaction on the elements of a company's financial statements?

Which of the following could represent the effects of an asset source transaction on a company's financial statements?

The following information applies to the questions displayed below Packard Company engaged in the following transactions during Year 1, its first year of operations: (Assume all transactions are cash transactions.) 1) Acquired $950 cash from the issue of common stock. 2) Borrowed $420 from a bank. 3) Earned $650 of revenues. 4) Paid expenses of $250. 5) Paid a $50 dividend. During Year 2, Packard engaged in the following transactions: (Assume all transactions are cash transactions.) 1) Issued an additional $325 of common stock. 2) Repaid $220 of its debt to the bank. 3) Earned revenues of $750. 4) Incurred expenses of $360. 5) Paid dividends of $100. -What was the balance of Packard's Retained Earnings account before closing in Year 1?

Retained earnings reduces a company's commitment to use its assets for the benefit of its stockholders.

Tandem Company borrowed $32,000 of cash from a local bank.Which of the following accurately reflects how this event affects the company's financial statements?

Which of the following would not describe the effects of an asset source transaction on the elements of a company's financial statements?