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Liabilities of a company are owed to

01/01/2021 Client: saad24vbs Deadline: 3 days

Question 1


Liabilities of a company are owed to




underwriters.


debtors.


creditors.


benefactors.




Question 2


Fat Possum's Service Shop started the year with total assets of $110,000 and total liabilities of $80,000. During the year, the business recorded $210,000 in revenues, $140,000 in expenses, and paid dividends of $20,000.




Stockholders' equity at the end of the year was




$120,000.


$100,000.


$80,000.


$30,000.




Question 3


All of the following are steps in analyzing ethics cases in financial reporting except




recognize an ethical situation and the ethical issues involved.


identify and analyze the principle elements in the situation.


identify the alternatives and weigh the impact of each alternative on various stakeholders.


contact law enforcement regarding any violations of corporate ethics codes.




Question 4


All of the following statements are correct except




A vital element in communicating economic events is the accountant's ability to analyze and interpret reported information.


The information that a user of financial information needs depends upon the kinds of decisions the user makes.


The origins of accounting are generally attributed to Socrates, a classical Greek philosopher, who promoted accounting as a social contract.


Good decision-making depends on good information.




Question 5


Retained earnings at the end of the period is equal to




assets plus liabilities.


retained earnings at the beginning of the period plus net income minus liabilities.


retainined earnings at the beginning of the period plus net income minus dividends.


net income.




Question 6


If total liabilities increased by $8,000, then




assets must have decreased by $8,000.


stockholders' equity must have increased by $8,000.


assets must have increased by $8,000, or stockholders' equity must have decreased by $8,000.


assets and stockholders' equity each increased by $4,000.




Question 7


Druganaut Company buys a $21,000 van on credit. The transaction will affect the




income statement and retained earnings statement only.


income statement, retained earnings statement, and balance sheet.


income statement only.


balance sheet only.




Question 8


IFRS, compared to GAAP, tends to be more




full of disclosure requirements.


principles-based.


detailed.


rules-based.




Question 9


Revenues would not result from




rental of property.


sale of merchandise.


performance of services.


issuance of common stock.




Question 10


Which of the following is an external user of accounting information?




Company officers.


Labor unions.


Managers.


Finance directors.




Question 11


The organization(s) primarily responsible for establishing generally accepted accounting principles is(are) the




 FASBSEC


          yes yes


           no no


          yes no


           no yes




Question 12


The concern about international companies adopting SOX-type standards centers on




ethics issues.


the governing authorities.


comparability.


cost-benefit analysis.




Question 13


A problem with the monetary unit assumption is that




the dollar is a common medium of exchange.


it is impossible to account for international transactions.


the dollar has not been stable over time.


the dollar has been stable over time.




Question 14


The first part of the accounting process is




processing.


recording.


identifying.


communicating.




Question 15


The primary purpose of the statement of cash flows is to report




a company's financing transactions.


a company's investing transactions.


the net increase or decrease in cash.


information about cash receipts and cash payments of a company.





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