ACC 556 Week 5 Midterm Exam – Strayer NEW

ACC 556 Week 5 Midterm Exam – Strayer NEW - ACC 556 Week...

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ACC 556 Week 5 Midterm Exam – Strayer NEW Click On The Link Below To Purchase A+ Graded Material Instant Download http://budapp.net/ACC-556-Midterm-Exam-Week-5-Strayer-NEW-ACC556W5E.htm Chapters 1 Through 8 CHAPTER 1 INTRODUCTION TO FINANCIAL STATEMENTS TRUE-FALSE STATEMENTS 1. A business organized as a separate legal entity owned by stockholders is a partnership. 2. Corporate stockholders generally pay higher taxes but have no personal liability. 3. The liability of corporate stockholders is limited to the amount of their investment. 4. The majority of U.S. business is transacted by proprietorships. 5. Proprietorships in the United States generate more revenue than the other two forms of business enterprise. 6. Owners of business firms are the only people who need accounting information. 7. Management of a business enterprise is the major external user of information. 8. External users of accounting information are managers who plan, organize, and run a business. 9. The information needs and questions of external users vary considerably. 10. Accounting communicates financial information about a business to both internal and external users. FOR INSTRUCTOR USE ONLY
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A Further Look at Financial Statements 11. Two primary external users of accounting information are investors and creditors. 12. Financing activities for corporations include borrowing money and selling shares of their own stock. 13. Investing activities involve collecting the necessary funds to support the business. FOR INSTRUCTOR USE ONLY 2-2
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A Further Look at Financial Statements 14. The purchase of equipment is an example of a financing activity. 15. Assets are resources owned by a business and provide future services or benefits to the business. 16. Payments to owners are operating activities. 17. The economic resources that are owned by a business are called stockholders’ equity. 18. Operating activities involve putting the resources of the business into action to generate a profit. 19. A business is usually involved in two types of activity—financing and investing. 20. Net income for the period is determined by subtracting total expenses and dividends from revenues. 21. A different set of financial statements usually is prepared for each user. 22. The heading for the income statement might include the line “As of December 31, 20xx.” 23. Net income is another term for revenue. 24. Cash is another term for stockholders’ equity. 25. The primary purpose of the statement of cash flows is to provide information about the cash receipts and cash payments of a company for a specific period of time. 26. The balance sheet reports assets and claims to those assets at a specific point in time. FOR INSTRUCTOR USE ONLY 2-3
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A Further Look at Financial Statements 27. The basic accounting equation states that Assets = Liabilities.
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