Preview

MULTIPLE CHOICE

Satisfactory Essays
Open Document
Open Document
1199 Words
Grammar
Grammar
Plagiarism
Plagiarism
Writing
Writing
Score
Score
MULTIPLE CHOICE
MULTIPLE CHOICE

1. The owner's equity in a business amounted to $56,000 at the beginning of the year and $100,000 at the end of the year. The owner had made no additional investments and had withdrawn $19,000 during the year. The net income for the year amounted to
a.
$76,000.
b.
$67,000.
c.
$63,000.
d.
$188,000.

ANS: C DIF: Medium OBJ: LO 6-1 MSC: AACSB Analytic

4. Changes in owner's equity that result from investments or withdrawals of assets by the owner are included in the
a.
statement of owner's equity.
b.
income statement.
c.
balance sheet.
d.
chart of accounts.

ANS: A DIF: Easy OBJ: LO 6-1 MSC: AACSB Communication

5. Owner's equity can be increased through
a.
withdrawals by the owner.
b.
investments by the owner.
c.
expenses exceeding revenues.
d.
purchases of assets for cash.

ANS: B DIF: Easy OBJ: LO 6-1 MSC: AACSB Communication

6. The balance in an expense account is closed to a(n)
a.
capital account.
b.
revenue account.
c.
drawing account.
d.
income summary account.

ANS: D DIF: Easy OBJ: LO 6-2 MSC: AACSB Communication

7. The order in which financial statements should be prepared is
a.
balance sheet, income statement, statement of owner's equity.
b.
income statement, balance sheet, statement of owner's equity.
c.
statement of owner's equity, balance sheet, income statement.
d.
income statement, statement of owner's equity, balance sheet.

ANS: D DIF: Easy OBJ: LO 6-1 MSC: AACSB Communication

8. After the closing entries are journalized and posted, which of the following accounts would NOT have a balance?
a.
Cash
b.
Office Equipment
c.
Notes Payable
d.
Delivery Fees

ANS: D DIF: Easy OBJ: LO 6-2 MSC: AACSB Communication

9. A form of balance sheet that lists the liabilities and the owner's equity sections below the assets section is called the
a.
account form.
b.
journal form.
c.
report form.
d.
current form.

ANS: C DIF: Easy OBJ: LO 6-1 MSC: AACSB Communication

10. After the closing entries have been posted, which of the

You May Also Find These Documents Helpful

  • Satisfactory Essays

    Conclusions: Alice transferred in building and land with a mortgage liability and received 400 shares of common stock. Alice however will recognize a gain of $10,000 the basis of the building and land is 0 (100,000 minus the mortgage of 60,000 plus the gain of 10,000).…

    • 592 Words
    • 3 Pages
    Satisfactory Essays
  • Satisfactory Essays

    | If total liabilities increased by $14,000 during a period of time and stockholders’ equity decreased by $6,000 during the same period, then the amount and direction (increase or decrease) of the period’s change in total assets is a(n)…

    • 1819 Words
    • 8 Pages
    Satisfactory Essays
  • Better Essays

    Week 4 the Lemonade Stand

    • 2664 Words
    • 11 Pages

    The Balance Sheet is another type of financial statement used by a company to see a snapshot of the company's financial position at a particular point in time. It lists the value of the company's assets followed by its liabilities. A balance sheet can be summed up by a simple equation:…

    • 2664 Words
    • 11 Pages
    Better Essays
  • Satisfactory Essays

    An account used with a related account to bring about a decrease in the net amount of the two account balances is called a(n)…

    • 964 Words
    • 8 Pages
    Satisfactory Essays
  • Satisfactory Essays

    A balance sheet is used to report the company’s assets, asset claims, and liabilities at a specific point in time. The basic accounting equation is what makes up the balance sheet. Assets are added together to come up with a total cost. Liabilities and stockholder’s equity is also added together. The two sums are then added together to figure out if the business relies on the owners and operators, or if it relies more on the investors. Shown below is an example of a company whose assets outweigh their liabilities.…

    • 366 Words
    • 2 Pages
    Satisfactory Essays
  • Good Essays

    The balance sheet is a snapshot which examines the business. This statement records assets, liabilities and the equity of a company at a particular point in time. The equation used for the balance sheet is assets = liabilities + shareholders\equity. Assets are those things that the company actually owns or controls. The liabilities are represented by the debt or financing that was taken out to acquire those assets. Equity is that money that has been provided by people or stockholders to keep the business afloat.…

    • 688 Words
    • 3 Pages
    Good Essays
  • Satisfactory Essays

    B120 Tma03

    • 1294 Words
    • 6 Pages

    A balance sheet is a summary of the value of all assets, liabilities and Ownership equity for an organisation on a specific date.…

    • 1294 Words
    • 6 Pages
    Satisfactory Essays
  • Good Essays

    14). The Balance sheet gives the exact money value worth of the assets over the liabilities of the company as of the specified time mentioned. The Balance sheet formula is “Assets = Liabilities + Stockholders’ Equity” (Kimmel et al., 2009, p. 14). The various resources possessed by a business such as property, cash, and equipment are Assets. Liabilities include the company’s payables to creditors and owners; the owner capital is also-called as Owner’s equity. A public company publicizes its Balance sheet to the general public. The creditors and investors use this statement to decide if they will invest in or lend to this company. The investors will see the likelihood of their money being repaid by the…

    • 749 Words
    • 3 Pages
    Good Essays
  • Satisfactory Essays

    21.Red Onion Restaurant classifies a six-month prepaid insurance policy as a current asset. Its rationale is based on:…

    • 758 Words
    • 4 Pages
    Satisfactory Essays
  • Satisfactory Essays

    4. __C___ On June 1, 2014, Portugal Inc. reported a cash balance of $12,000. During June, Portugal made deposits of $5,000 and made disbursements totalling $14,000. What is the cash balance at the end of June?…

    • 633 Words
    • 8 Pages
    Satisfactory Essays
  • Good Essays

    individual business enterprises, rather than to industries or an economy as a whole or to members of society as consumers.…

    • 2749 Words
    • 11 Pages
    Good Essays
  • Satisfactory Essays

    Acc 290

    • 1661 Words
    • 7 Pages

    5. ABC Corporation issues 100 shares of $1 par common stock at $5 per share, which of the following is the correct journal entry?…

    • 1661 Words
    • 7 Pages
    Satisfactory Essays
  • Better Essays

    Second is the statement of stockholders equity. The statement of stockholders equity details changes in the investments made by the organizations owners, including stock issuances, stock repurchases, stock conversions, dividends paid, net income or net loss (McGladrey, Pullen, 2006). The third statement is the balance sheet. The balance sheet is a broad look at the organizations standing. The balance sheet shows the assets, liabilities, and stockholder 's equity for a specific period of time. The assets are listed at the top of the balance sheet, followed by the liabilities and stockholders ' equity. Assets and liabilities are divided into short-term and long-term. The bottom line of the balance sheet must be equal, which means assets must equal the liabilities and stockholders equity.…

    • 991 Words
    • 4 Pages
    Better Essays
  • Good Essays

    Multiple Choice

    • 2103 Words
    • 9 Pages

    1. Which of the following statements about heat is false? A) If heat flows into a system, the extra energy of the system appears in the form of internal energy. B) A hot object possesses more heat than a cold object. C) If the system and surroundings are in thermal equilibrium, there is no heat flow between them. D) A process in which heat flows out of a system is said to be exothermic. E) Heat is a form of energy flow.…

    • 2103 Words
    • 9 Pages
    Good Essays
  • Good Essays

    Decorative Interiors

    • 1050 Words
    • 5 Pages

    Rocco Rapini, owner of Decorative Interiors Inc (DI), aged 47 years has suffered an unexpected heart attack on 8th July, 2006 and is advised by doctors to reduce stress significantly in daily routine. This has forced him to take an appropriate decision about his business. He is in a dilemma and not able to decide which course of action will be beneficial both for his business as well as his health. Keeping this in mind, he has hired the services of a management consultant to help him take a decision on how to proceed.…

    • 1050 Words
    • 5 Pages
    Good Essays