Question 1

All of the following regarding a Certified Public Accountant are except:

Accepted Answer

A)   Must meet education and experience requirements.
B)   Must pass an examination.
C)   Must exhibit ethical character.
D)   May also be a Certified Management Accountant.
E)   Cannot hold any certificate other than a CPA.F) B) and E)
G) A) and D)

Question 2

An example of an investing activity is:

Accepted Answer

A)   Paying wages of employees.
B)   Withdrawals by the owner.
C)   Purchase of land.
D)   Selling inventory.
E)   Contribution from owner.F) C) and D)
G) B) and C)

Question 3

If a parcel of land that was originally purchased for $85,000 is offered for sale at $150,000, is assessed for tax purposes at $95,000, is recognized by its purchasers as easily being worth $140,000, and is sold for $137,000. What is the effect of the sale on the accounting equation for the seller?

Accepted Answer

A)   Assets increase $52,000; owner's equity increases $52,000.
B)   Assets increase $85,000; owner's equity increases $85,000.
C)   Assets increase $137,000; owner's equity increases $137,000.
D)   Assets increase $140,000; owner's equity increases $140,000.
E)   Assets decrease $85,000; owner's equity decreases $85,000.F) A) and C)
G) A) and D)

Question 4

On December 15 of the current year, Myers Legal Services signed a $50,000 contract with a client to provide legal services to the client in the following year. Which accounting principle would require Myers Legal Services to record the legal fees revenue in the following year and not the year the cash was received?

Accepted Answer

A)   Monetary unit assumption.
B)   Going-concern assumption.
C)   Cost principle.
D)   Business entity assumption.
E)   Revenue recognition principle.F) A) and B)
G) B) and D)

Question 5

____________ are the increases in equity from a company's earnings activities

Accepted Answer

The answer of ____________ are the increases in equity from...

Question 6

Good ethics are good business.

Accepted Answer

A) True 
 B)False

Question 7

Every business transaction leaves the accounting equation in balance.

Accepted Answer

A) True 
 B)False

Question 8

Quick Computer Service had revenues of $80,000 and expenses of $50,000 for the year. Its assets at the beginning of the year were $400,000. At the end of the year assets were worth $450,000. Calculate its return on assets.

Accepted Answer

A)   7.1%
B)   7.5%
C)   6.7%
D)   20.0%
E)   18.8%F) A) and B)
G) B) and C)

Question 9

If equity is $300,000 and liabilities are $192,000, then assets equal:

Accepted Answer

A)   $108,000.
B)   $192,000.
C)   $300,000.
D)   $492,000.
E)   $792,000.F) All of the above
G) B) and E)

Question 10

Identify several opportunities in accounting and its related fields.

Accepted Answer

The traditional areas of accounting incl...

Question 11

Return on assets is also known as return on investment.

Accepted Answer

A) True 
 B)False

Question 12

______________ is the area of accounting aimed at serving external users.

Accepted Answer

Financial ...

Question 13

Social responsibility:

Accepted Answer

A)   Is a concern for the impact of our actions on society.
B)   Is a code that helps in dealing with confidential information.
C)   Is required by the SEC.
D)   Requires that all businesses conduct social audits.
E)   Is limited to large companies.F) B) and E)
G) B) and D)

Question 14

The records of Skymaster Airplane Rentals show the following information as of December 31. Skymaster withdrew $52,000 during the year for personal expenses. Prepare a December income statement, a December statement of changes in equity, and a December 30 balance sheet.

Accepted Answer

SKYMASTER AIRPLANE...

Question 15

A partnership:

Accepted Answer

A)   Is also called a sole proprietorship.
B)   Has unlimited liability for its partners.
C)   Has to have a written agreement in order to be legal.
D)   Is a legal organization separate from its owners.
E)   Has owners called shareholders.F) B) and E)
G) A) and D)

Question 16

Determine the net income of a company for which the following information is available for the month of May.

Accepted Answer

A)   $190,000.
B)   $210,000.
C)   $230,000.
D)   $400,000.
E)   $610,000.F) A) and B)
G) All of the above

Question 17

Assets created by selling goods and services on credit are:

Accepted Answer

A)   Accounts payable.
B)   Accounts receivable.
C)   Liabilities.
D)   Expenses.
E)   Equity.F) B) and C)
G) A) and D)

Question 18

The income statement reports on operating activities at a point in time.

Accepted Answer

A) True 
 B)False

Question 19

Resources that are expected to yield future benefits are:

Accepted Answer

A)   Assets.
B)   Revenues.
C)   Liabilities.
D)   Owner's Equity.
E)   Expenses.F) D) and E)
G) A) and E)

Question 20

If a parcel of land that was originally purchased for $85,000 is offered for sale at $150,000, is assessed for tax purposes at $95,000, is recognized by its purchasers as easily being worth $140,000, and is sold for $137,000. At the time of the sale, assume that the seller still owed $30,000 to TrustOne Bank on the land that was purchased for $85,000. Immediately after the sale, the seller paid off the loan to TrustOne Bank. What is the effect of the sale and the payoff of the loan on the accounting equation?

Accepted Answer

A)   Assets increase $52,000; owner's equity increases $22,000; liabilities decrease $30,000
B)   Assets increase $52,000; owner's equity increases $30,000; liabilities decrease $30,000
C)   Assets increase $22,000; owner's equity increases $52,000; liabilities decrease $30,000
D)   Assets decrease $30,000; owner's equity decreases $30,000; liabilities decrease $30,000
E)   Assets decrease $55,000; owner's equity decreases $55,000; liabilities decrease $30,000F) B) and C)
G) A) and B)

Exam 1: Accounting in Business

Quick Computer Service had revenues of $80,000 and expenses of $50,000 for the year. Its assets at the beginning of the year were $400,000. At the end of the year assets were worth $450,000. Calculate its return on assets.

Correct Answer
verified

Good ethics are good business.

Correct Answer
verified

Correct Answer
verified

If a parcel of land that was originally purchased for $85,000 is offered for sale at $150,000, is assessed for tax purposes at $95,000, is recognized by its purchasers as easily being worth $140,000, and is sold for $137,000. What is the effect of the sale on the accounting equation for the seller?

Correct Answer
verified

______________ is the area of accounting aimed at serving external users.

Correct Answer
verified
Financial ...
View Answer

The records of Skymaster Airplane Rentals show the following information as of December 31. Skymaster withdrew $52,000 during the year for personal expenses. Prepare a December income statement, a December statement of changes in equity, and a December 30 balance sheet.

Correct Answer
verified
SKYMASTER AIRPLANE...
View Answer

Identify several opportunities in accounting and its related fields.

Correct Answer
verified
The traditional areas of accounting incl...
View Answer

If equity is $300,000 and liabilities are $192,000, then assets equal:

Correct Answer
verified

All of the following regarding a Certified Public Accountant are except:

Correct Answer
verified

The income statement reports on operating activities at a point in time.

Correct Answer
verified

Assets created by selling goods and services on credit are:

Correct Answer
verified

____________ are the increases in equity from a company's earnings activities

Correct Answer
verified

Determine the net income of a company for which the following information is available for the month of May.

Correct Answer
verified

Every business transaction leaves the accounting equation in balance.

Correct Answer
verified

Return on assets is also known as return on investment.

Correct Answer
verified

An example of an investing activity is:

Correct Answer
verified

A partnership:

Correct Answer
verified

Social responsibility:

Correct Answer
verified

Resources that are expected to yield future benefits are:

Correct Answer
verified

Correct Answer
verified

Exam 1: Accounting in Business

Quick Computer Service had revenues of $80,000 and expenses of $50,000 for the year. Its assets at the beginning of the year were $400,000. At the end of the year assets were worth $450,000. Calculate its return on assets.

Correct AnswerverifiedShow Answer

Good ethics are good business.

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

If a parcel of land that was originally purchased for $85,000 is offered for sale at $150,000, is assessed for tax purposes at $95,000, is recognized by its purchasers as easily being worth $140,000, and is sold for $137,000. What is the effect of the sale on the accounting equation for the seller?

Correct AnswerverifiedShow Answer

______________ is the area of accounting aimed at serving external users.

Correct AnswerverifiedFinancial ...View AnswerShow Answer

The records of Skymaster Airplane Rentals show the following information as of December 31. Skymaster withdrew $52,000 during the year for personal expenses. Prepare a December income statement, a December statement of changes in equity, and a December 30 balance sheet.

Correct Answerverified SKYMASTER AIRPLANE...View AnswerShow Answer

Identify several opportunities in accounting and its related fields.

Correct AnswerverifiedThe traditional areas of accounting incl...View AnswerShow Answer

If equity is $300,000 and liabilities are $192,000, then assets equal:

Correct AnswerverifiedShow Answer

All of the following regarding a Certified Public Accountant are except:

Correct AnswerverifiedShow Answer

The income statement reports on operating activities at a point in time.

Correct AnswerverifiedShow Answer

Assets created by selling goods and services on credit are:

Correct AnswerverifiedShow Answer

____________ are the increases in equity from a company's earnings activities

Correct AnswerverifiedShow Answer

Determine the net income of a company for which the following information is available for the month of May.

Correct AnswerverifiedShow Answer

Every business transaction leaves the accounting equation in balance.

Correct AnswerverifiedShow Answer

Return on assets is also known as return on investment.

Correct AnswerverifiedShow Answer

An example of an investing activity is:

Correct AnswerverifiedShow Answer

A partnership:

Correct AnswerverifiedShow Answer

Social responsibility:

Correct AnswerverifiedShow Answer

Resources that are expected to yield future benefits are:

Correct AnswerverifiedShow Answer

Correct AnswerverifiedShow Answer

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
verified
Financial ...
View Answer

Correct Answer
verified
SKYMASTER AIRPLANE...
View Answer

Correct Answer
verified
The traditional areas of accounting incl...
View Answer

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
verified

Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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Correct Answer
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