REVIEWEXAM1 - 1 Multiple Choice Questions-CHAPTER 1 REVIEW...

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Multiple Choice Questions—CHAPTER 1 REVIEW 42. On January 1, 2006, two individuals invested $500,000 each to form Jordan Corporation. Jordan had total revenues of $200,000 during 2006 and $250,000 during 2007. Total expenses for the same periods were $120,000 and $140,000 respectively. Cash dividends paid out to stockholders totaled $20,000 in 2006 and $25,000 in 2007. What was Jordan’s total stockholders' equity at the end of 2006 and 2007? A) $1,000,000 and $1,065,000 respectively. B) $1,060,000 and $1,145,000 respectively. C) $1,100,000 and $1,170,000 respectively. D) $1,210,000 and $1,410,000 respectively. Answer: B Difficulty: Hard L.O.: 1 44. Atlantic Corporation reported the following amounts at the end of the first year of operations, December 31, 2006: contributed capital $100,000; sales revenue $400,000; total assets $300,000; $20,000 dividends; and total liabilities $160,000. Retained earnings and total expenses would be 45. The financial statement that reports the financial position of a business is the 46. Barker Corporation reported the following for 2007; total assets, $270,000; total liabilities, $105,000; contributed capital, $120,000. Therefore, retained earnings was 1
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47. Which of the following reports the cash inflows, cash outflows, and change in cash for period? A) Income statement. B) Balance sheet. C) Statement of cash flows. D) Auditor's report. E) None of the above is correct. Answer: C Difficulty: Easy L.O.: 1 55. Which of Chao’s financial statements would you look at to determine whether Chao will be able to pay for the goods when payment is due in 30 days? 56. Which financial statement shows the financial position of a business as of a given date? 57. Which of the following is not considered to be a liability? 2
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